Common Reasons and Tips for Back Taxes

The taxation process is quite grueling, and even federal agency workers may run into trouble with paying their dues. For instance, in October 2013, it was discovered that almost 700 IRS contract workers owed $5.4 million in taxes. In May 2014, it was revealed that more than 300,000 federal employees owed back taxes amounting to $3.3 billion.

 

These taxpayers (or tax non-payers) and the rest of the individuals with tax deficiencies aren’t necessarily delinquent. There are just several factors that prevent them or make it difficult for them to accomplish their responsibilities, such as:

 

Late or Failure to File Returns

 

Missing the guidelines in reporting your income is one of the most common mistakes by taxpayers. Be sensitive to the strict deadlines and set tax brackets that the IRS imposes every year for you to be guided on when to file your returns and how much taxes you can expect to owe.

Underwithholding or Incorrectly Estimated Tax Payments

 

When you claim excessive exemptions on your IRS Form W-4 (filled out during the hiring process) or if you’re a self-employed individual and fall behind on your monthly or quarterly tax payments, you may incur more liabilities. Have a tax lawyer oversee your financial obligations, and have them adjusted accordingly.

 

Hardships

 

Of course, the gravest reasons for back taxes are the unforeseen life events or major changes, such as a death, disability, sickness, and bankruptcy. In these cases, seek the professional guidance of a tax lawyer to explore your tax relief options.

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