The Importance of Filing Taxes

As the April 15th federal tax filing deadline arrives, many people delay preparing their tax returns if they are likely to owe federal or state taxes. While no individual or entity wants to owe taxes, it is important that even if you cannot afford to pay your liability at the time you file, you should still file.

Under federal law, the Internal Revenue Service (IRS) has only ten years to collect any debt due. However, this ten-year time period does not start to run until a tax return is filed and the tax liability is assessed.If the tax return is never filed and the taxes are not assessed, this time period will not begin to run and the IRS will have a longer period of time to which it can collect the debt. While there are exceptions to this rule and certain events that can extend the time period that the IRS can collect, the time period will never start until such time as the tax return is filed and/or the tax liability is assessed.

In addition, after filing a tax return with a liability,taxpayers have several options to resolve the outstanding liability if they cannot afford to pay the liability in full. However, the first step to resolving outstanding liabilities and debts with the IRS is to file those tax returns.

The Bethesda and Rockville, Maryland tax litigation and tax planning attorneys at Longman & Van Grack have years of experience providing insightful tax advice and trial advocacy on behalf of clients involved in tax disputes with the IRS and the State of Maryland. In fact, Robb Longman is the Chair-Elect of the Maryland State Bar Association’s Tax Section. If you have a tax question or concern, call (301) 291-5027 to schedule a consultation.