Potential Problems of Not Filing a Tax Return
Paying taxes is part of life here in America. Most people must pay something in the way of taxes unless their income and asset worth are so low that they do not have to file. Many individuals or companies forget to pay their owed taxes, or simply choose not to be ignorant of what those consequences of not paying taxes owed could bring to their lives warns a seasoned tax lawyer Atlanta area inhabitants already trust for legal tax counsel.
What Happens if You Are Self-Employed & Neglect to File Taxes?
People who are self-employed sometimes believe that they can get by without paying taxes because the IRS is not likely to know their business information claims a knowledgeable Atlanta tax lawyer. This is a false assumption that could lead to serious penalties that may include steep fines, interest added to tax owed, and other repercussions.
Self-employed individuals who fail to pay the tax obligations they owe will also be in trouble for not reporting their income truthfully, and these people will not have accumulated credits that are to go towards paying into disability and/or retirement account funds every worker is required to do.
The Penalties for Failure to Pay Taxes Are Not Worth It
Just like continuing to spend and rack up debt using credit cards, failure to pay your owed tax amount will also increase not just the tax owed itself but there will be increasingly higher interest payments that will need to be paid as well.
The courts will order these tax evasion individuals to pay at least .5% of whatever tax is owed each month until either the entire debt is paid or the person has paid at 25% of what is owed. It truly is not worth it to avoid paying owed tax. A tax settlement attorney can help individuals figure out their tax problems and come up with a doable solution.
The Longer That Your Tax Remains Unpaid Significantly Increases Interest
Interest will increase to around 1% if your tax bill remains unpaid for 10 days cautions a local tax attorney IRS. There are also late payment fees that also increase if the debt is not paid off in its entirety fairly quickly. Those individuals that have tax debt bills that are over 60 days old will face the minimum late filing fee amount which is 135 dollars, or the amount left that is yet to be paid whichever is the lowest.
The IRS Will File a Substitute Tax Return Which May Not Include Exemptions
Several area tax law firms explain that when someone does not pay their fair share of taxes, the IRS will file a substitute tax return eventually. This assessment may not include legitimate tax exemptions that the person may be entitled to.
The IRS Can Begin Collection Proceedings, Garnish Wages, Freeze Bank Accounts & More
Once this tax is formally assessed, the IRS can then start collection processes that may include putting a legal tax levy on the taxpayer’s bank account funds and against your earned wages using garnishment processes. The IRS can even file a federal tax-related lien on your home or other valuable property.
As it should now be readily apparent that not paying taxes on time can cause serious consequences that can impact your life for many years warns reputable tax attorneys in Atlanta and elsewhere.