How do i know if i have back taxes

August 31, 2021 by Samantha Lamb

Owing the IRS additional taxes is not something most people plan on, but it can happen to anyone.

The most common way to know if you owe the IRS or not would be to start with your tax return.

If you are one of the millions of self-preparers who uses a tax preparation software, the program will tell you whether you will get a refund or end up owing taxes. If you use a tax professional to file your taxes, they will let you know if a refund is in your future or if you will be required to pay the taxing agency.

After your tax return is submitted, it will be reviewed and processed by the IRS. The IRS computer system looks at the return and updates your account with the information provided. Sometimes the system flags your tax return for further review, and this will trigger a notice being mailed to you. The notice will let you know if the IRS thinks you owe them money based on the information provided.

Use the IRS Online Account Tool to Check if You Owe Taxes

If you haven’t received a notice, but think you might owe the IRS, you can also utilize their Online Account Tool, which is one of many tools that the IRS has added over the years to help taxpayers better understand their information. The online account tool allows you to:

• Look up tax records
• Determine whether or not you owe taxes – and view any amounts you possibly owe
• Find out information regarding tax filing
• Set up an online payment agreement and/or pay your taxes online
• Review the past 18 months of payment history
• View key tax return information for the most recent return you filed

To access the online account tool, you will need to register by visiting Secure Access, which is the IRS’ two-factor authentication process. This helps protect your identity and your personal information. If you’ve already logged into Secure Access, you can use the same username and password as before.

What to do if you Owe Money to the IRS

In the event that you receive a notice or you do owe money to the IRS, TaxAudit provides quality audit defense and tax debt relief services to taxpayers all over the country. Many people who owe money to the IRS or a state tax authority qualify for some sort of tax debt relief. That relief comes in different forms like preventing wage garnishment and helping you set up payment plans. Some people may benefit from a tax debt settlement, or you may qualify for Innocent Spouse Relief or Penalty Abatement. There are lots of different solutions out there, and our tax relief specialists will help you navigate the tax laws and regulations to find a solution that works for you.

If you’ve received a notice from the IRS or a state tax authority – TaxAudit can help determine if the notice is correct or not. If the notice is correct, our tax professionals will help you through the process and let you know what the best course of action will be. If the notice is not correct, we will let you know what documentation we will need and will respond to the IRS for you. In every case, one of our main goals is to help educate you as a taxpayer to make sure you avoid owing the IRS in the future.

If you have been wondering “How much do I owe the IRS?” it may be a matter of a simple calculation using an IRS form, or it may require the services of a professional tax company. In this post, we’ll help you answer the question, “Do I owe the IRS?” and explain what steps to take if you are in tax debt.

How To Check Your Tax Debt Balance

The easiest way to determine if you owe the IRS money is by checking your federal tax account. To check your account: 

1. Go to IRS.gov/account 
2. Log into your account or sign up using the following information:
   1. Full Name
   2. Email
   3. Birthdate
   4. Social Security Number (SSN) or Individual Tax Identification Number (ITIN)
   5. Tax filing status
   6. Current address
3. View tax balance

In addition to finding how much you owe the IRS, your federal tax account allows you to view payment history, access digital copies of notices from the IRS, review payment plan details, and more. You can also contact the IRS on the phone, or do so in person through a local IRS office. You’ll need to have your Social Security number and personal information with you. You can then ask whether there’s an IRS tax balance owed on your tax account for any previous filing periods.  Many taxpayers are uncomfortable contacting the IRS or have no idea where to start when it comes to settling their tax debt. Community Tax can handle all interactions with the government agency and help you prepare tax returns for both the current year and any previous year in which you didn’t file.

How Does The IRS Notify Taxpayers of Tax Debt?

In addition to updating your federal tax account with your balance owed, the IRS will send you a notice with the amount due. The IRS sends numerous notices to delinquent taxpayers; with each subsequent notice, the consequences increase in severity. 

• IRS Statutory Notice of Deficiency: If you receive a CP3219 or LT3219 notice, the IRS is notifying you that you owe additional taxes on a tax return. This may mean they’ve performed an audit, your tax return doesn’t match taxable income information the IRS has received from other parties, or they’re performing an unfiled return investigation. 

Before receiving this notice, you’ve been sent multiple notices explaining any additional taxes the IRS believes you owe. This is essentially your “last chance” notice. You have 90 days to either protest the additional taxes or pay the tax owed.

• Final Notice of Intent to Levy: If you’ve ignored previous notices and refused to get in contact with the IRS about settling your debt, you’ll receive a Final Notice of Intent to Levy. This means your case has been transferred to the IRS Collection Unit, who now have the authority to enforce collection through a lie or levy. 

You’ll never receive a Final Notice of Intent to Levy out of the blue; the IRS sends out numerous letters beforehand that request you pay your bill or make an installment plan with the IRS. After this notice is sent, you have 30 days to create a payment plan with the government agency, or be subject to a levy.

What If I Don’t Pay The IRS?

Ignoring the IRS’s attempts to collect what they’re owed can result in some pretty harrowing consequences, including the previously mentioned tax levies and liens. Ignoring an IRS notice can cause both immediate and long-term issues.

• Substitute for Return: If you fail to file and ignore the IRS’s requests to do so, they may file a substitute for return. This takes the place of a regular tax return, and sees the IRS calculating your taxes for you, based upon your previous tax returns. This means you have no control over the deductions and credits given, and could see you spending way more.
• A Visit from the IRS: The IRS may send a tax revenue officer to your home. During these visits, they’ll ask you about your money situation and outline the various consequences you can expect should you choose to ignore your tax debt.
• Wage Garnishment: This tax lien sees the government taking a portion of your paycheck each pay period in order to start paying off your tax debt.
• Asset Seizure: There are some cases in which the IRS will seize personal assets to cover the cost of your tax debt. The IRS can seize virtually any personal asset, including your home, cars, boats, and other valuables; they will sell these items in order to repay your tax bill.
• Criminal Charges: Although rare and usually only applicable in cases of fraud, delinquent taxpayers could face criminal charges for tax evasion. 

Tax Debt Solutions

If you determine that you do in fact owe the IRS, it’s imperative that you resolve your tax debt as soon as possible. Fortunately, there are several solutions that can make paying off tax debt more manageable. 

• Short-Term Extension: If you can’t pay your tax debt immediately, you can consider a short-term extension to pay which provides you with 120 extra days to pay off all of your taxes.
• Installment Agreements: If you won’t be able to come up with the necessary funds right away, you may consider applying for an installment agreement. Taxpayers who owe less than $50,000 or less qualify for this type of monthly installment plan. Once approved, you can pay through a direct debit option, which is the least costly of the options offered by the IRS.
• Offer in Compromise: Taxpayers who will never be able to pay off their tax debt in full without undue hardship may qualify for an offer in compromise. Should your request be accepted, the IRS will forgive a portion of your debt, letting you settle for less than the full amount you owe. 

If you can’t pay your tax debt back in full immediately, there are options. Our team can help you assess which route is best for your individual circumstances.  How Can Community Tax Help Me? Do you owe the IRS money? Let us help. You can work directly with a professional team of tax attorneys, CPA’s and enrolled agents who have years of experience helping taxpayers across the country settle their tax debts.  From tax form questions to issues about self-employment tax returns, our team of dedicated tax professionals are prepared to help you settle your tax debt. If you are wondering “How much do I owe the IRS?” and you don’t know where to start, call us today at 1-888-676-4319 and get a FREE consultation about your needs.