Here's a tip: If you can't even remember which return you need to file for, you've waited too long. (And yes, we have a client whose got that problem.)
Things you should know about filing late:
- If you are going to file an extension, you still must make a good faith estimate of what you believe your tax liability will be and send it in when you file the extension. If you underpay the IRS can charge you penalties and interest.
- The first extension expires on August 15th. If you can show that you have a reason why you can't file by that time, the IRS may grant you a second extension that expires October 15th. If you miss that deadline the IRS can assess a penalty for late filing based on the amount outstanding on your return.
- You have a legal responsibility to file your return unless your income is extremely low. If you failed to file a return from 20 years ago (assuming you had income), you are still legally required to file that return. Also, the statute of limitations period for a return year generally doesn't start running until the return is filed. (Generally, three years after April 15th or the day the return is filed, whichever is later, the statute period will expire.)
- If you owe money for any year you will be required to pay the remaining balance, a late filing penalty, a late payment penalty, and interest (compounded monthly).
- If you were due a refund but file a return more than 3 years late, you are out of luck in most cases. Except in very rare cases the IRS is not required (indeed not allowed) to refund the money.
- Another thing to keep in mind is that tax preparation software can be very memory intensive. For that reason, many practices do not reinstall old software packages when they upgrade their computer systems. If you are filing more than 3 or 4 years late, there is a good chance that your tax preparer may have to reinstall old software or prepare the return by hand. That can be very expensive for you.
What's the moral of the story? No matter how much you hate it, file your returns on time!