Unpaid Income Taxes

Do you know what can happen when you accrue unpaid income taxes? You could face a series of hefty penalties and fines and even have your property confiscated. Let's look at some of the ways unpaid income taxes are dealt with by the tax authorities.

You may have heard about the millions in revenue that the federal government loses each year when people fail to pay their income taxes. As a result, failing to file a tax return is an offence and can get individuals and businesses into a lot of trouble.

But firstly, do you know how to file a tax return? The process is relatively simple. At the end of each tax year, your employer will send you a W2 form in the mail. This form lists how much money you earned in the last tax year and how much tax you paid on your income. You can find this information on your last pay check if you want to verify that the W2 form is correct. You should always make sure your W2 form is kept in a safe place because you will need to send it to the IRS.

Usually you will receive your W2 form before 31 January. So you now have up until April 15 to file your income tax. You will need to fill out the appropriate form and send it to one of the IRS centres in your local area. The IRS will process this information and work out whether you have paid the correct amount of tax. If you work for an employer whose job it is to calculate all your tax for you, you have probably paid the correct amount. However, if your circumstances have changed during the tax year, for example, you may have lost your job or changed jobs, you could be owed a tax refund. If so, you will either, receive a check in the mail or have the funds deposited into your bank account.

Failure to follow this procedure can result in unpaid income taxes and have serious implications for your future financial health.