Help with unfiled tax returns in New York City
Maybe it started with one year. Life got hard, you couldn't pay, so you didn't file. Then the next year felt even harder to face. Now it's been several years, and every envelope from the IRS makes your stomach drop.
You're not the first person to end up here, and it can be fixed. I'm Solomon Grosinger, an Enrolled Agent in Brooklyn. I help people across New York City get caught up on missing returns and then deal with whatever they owe.
Why filing comes first
Almost nothing gets resolved while returns are missing. The IRS generally won't agree to a payment plan or other resolution until the required returns are in. Filing is the step that opens every other door.
Not filing also costs you:
Bigger penalties. The failure-to-file penalty is generally 5% of the unpaid tax for each month or part of a month the return is late, up to 25%. It's usually much larger than the late-payment penalty.
Lost refunds. If you're owed a refund, you generally have to file within 3 years of the due date to claim it. After that, the money can be gone.
Held refunds. The IRS can hold a current-year refund when its records show an older return is missing.
Social Security credits. If you're self-employed and don't file, that income isn't reported to Social Security.
Loans. Lenders usually want copies of filed returns.
What a substitute for return (SFR) means
If you don't file, the IRS may file a return for you, called a substitute for return. It's built from the income reported to the IRS, like W-2s and 1099s. It may not give you credit for deductions and exemptions you're entitled to. That's why SFR balances are often much higher than what you'd really owe.
The IRS then sends a notice of deficiency, often a CP3219N, also called a 90-day letter. You have 90 days to file your own return or petition the Tax Court. That deadline can't be extended. If you do neither, the IRS assesses its number and collection follows: levies on wages or bank accounts, or a federal tax lien.
Even after an SFR is assessed, it's still generally in your interest to file your own correct return. The IRS will generally adjust your account to reflect the right figures.
How far back do you need to go?
Under IRS policy, enforcement of unfiled returns is normally limited to six years, though it depends on the facts of each case. Some people need fewer years, some need more. I pull your IRS wage and income transcripts to see what the IRS already has, and then we decide which years actually need to be filed and in what order.
Don't forget New York
If you lived in New York City, you likely need New York State returns too, and NYC resident tax is figured on the state return. New York can assess and collect on its own, through warrants, levies and income executions. I make sure the state side is handled along with the federal side.
What I do
Pull your IRS transcripts to see reported income and what's been filed or assessed.
Figure out which years are required, federal and state.
Prepare the missing returns with the deductions and credits you're entitled to.
Replace SFR assessments with your real returns where that helps.
Resolve the balance with the right option: a payment plan, Currently Not Collectible status, penalty abatement where it applies, or an Offer in Compromise if your numbers truly support it.
A word about criminal risk
Most unfiled-return cases are civil. But the IRS says that repeatedly not filing can lead to more penalties and, in some cases, criminal prosecution. I don't handle criminal tax cases. If I see signs of a criminal issue on our first call, I'll tell you to talk to a tax attorney.
Common questions
How many years of unfiled returns do I have to file? IRS policy normally enforces filing for no more than six years, though it depends on your facts. I check your transcripts and tell you which years you actually need.
The IRS already filed a return for me. Do I still need to file? Usually, yes. A substitute for return often leaves out deductions you're entitled to. Filing your own correct return generally lets the IRS adjust your account.
Can I still get refunds for old years? Generally only if you file within 3 years of the original due date. Older refunds are usually lost.
I can't pay what I'll owe. Should I still file? Yes. File even if you can't pay. Filing stops the larger failure-to-file penalty from growing, and it lets us work on a payment option.
Will I go to jail for not filing? Most cases are civil. If there are signs of a criminal problem, I'll refer you to a tax attorney.
Let's get you current
Book a free 30-minute call to go over your case. For a quick question, you can call (718) 510-3166. Tell me which years are missing and what letters you've received. I'll tell you honestly where you stand.
General info, not advice for your specific case. Every case is different.