How many years should I file for back taxes? Need advice on unfiled returns from 2017-2020
Title: How many years should I file for back taxes? Need advice on unfiled returns from 2017-2020 1 Hey everyone! So I've got a bit of a tax mess on my hands. I didn't file any tax returns from 2017 all the way through 2020, but I just got caught up by filing my 2021, 2022, and 2023 returns with a tax preparer. When I asked him about going back and filing those older years (2017-2020), he seemed confused about why I'd even want to do that since he said I probably wouldn't get any refunds from them. I always thought there would be some kind of penalty or problem if I just left those years unfiled forever? The main reason I'm trying to get everything straightened out is that I'm starting college next January and wanted to make sure I'm eligible for financial aid through FAFSA. I've been checking the FAFSA website but don't see much about requiring specific tax years to be filed. So my question is: Should I bother filing those back taxes from 2017-2020 or just leave them alone since I'm current with the last three years? Will this affect my FAFSA eligibility? Any advice would really help!
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Malik Jenkins
8 Tax professional here - this is actually a great question that comes up often. Generally, the IRS has a 3-year window for claiming refunds, so any refunds from 2017-2019 are likely gone forever. However, there are still important reasons to consider filing those back taxes. If you owed money for those years, the IRS can come after you for 10 years from the date they assess the tax (which requires filing first). Non-filing can lead to penalties that accumulate over time. Even if you don't owe, having unfiled returns can create problems with loan applications, mortgage approvals, and yes - potentially with financial aid. For FAFSA specifically, they typically look at your tax information from two years prior to the academic year (so 2023 taxes for the 2025-2026 academic year), but having unfiled returns can trigger verification flags in their system.
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Malik Jenkins
•5 But if they don't owe any taxes for those years, can the IRS really penalize them? I thought penalties were just a percentage of taxes owed, so if you owe $0, wouldn't the penalty also be $0?
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Malik Jenkins
•8 You're partially correct. The failure-to-file penalty is indeed calculated as a percentage of unpaid taxes, so if you're due a refund or owe nothing, there's typically no penalty for filing late. However, the problem is that without filing, neither you nor the IRS knows for certain whether you owed taxes or not. Some people assume they don't owe when they actually do - perhaps from unreported income, self-employment taxes, or incorrectly withheld amounts. Until you file, it remains an unknown liability hanging over you, and the IRS can eventually create a substitute return which often doesn't include all your deductions and credits.
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Malik Jenkins
12 I was in almost the exact same situation last year - had unfiled returns from 2018-2020 and was worried about going back to school. I used https://taxr.ai to analyze my situation and it was super helpful. You upload your documents and it tells you which years you should prioritize filing and which ones might not be worth the trouble. In my case, it showed I was owed refunds for 2019 and 2020 that I would have completely missed, but 2018 wasn't worth filing because I would have owed a tiny amount and the refund window had closed anyway. The analysis saved me from paying preparation fees for a year that wouldn't benefit me.
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Malik Jenkins
•4 How does the system know if you're owed a refund before you actually file? Seems like you'd need to do all the work of preparing the return before knowing if it's worth filing?
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Malik Jenkins
•17 I'm skeptical. Wouldn't you need to have all your W-2s and documents from those years for this to work? I lost half my paperwork from even 2 years ago, let alone 5+ years back.
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Malik Jenkins
•12 The system doesn't prepare your actual tax return - it analyzes your situation based on the documents you do have. It uses those to estimate whether you'd likely owe or be owed a refund, and by how much. This helps you decide which years are worth the effort of formal filing. As for missing documents, that's actually one of the best features. You can request transcripts directly through their system which pulls your income history from the IRS database. It showed me income from jobs I had completely forgotten about and retrieved all the reported W-2 and 1099 information. Saved me from digging through boxes of old paperwork I probably wouldn't have found anyway.
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Malik Jenkins
17 Follow up to my skepticism about taxr.ai - I actually tried it after posting and I'm genuinely surprised at how helpful it was! I had 3 years of unfiled taxes hanging over my head and was able to get my full income transcript from the IRS through their system, which showed I was owed refunds for two of those years. The detailed breakdown made it clear which years were worth filing and which weren't worth my time. I was able to get those back taxes filed within a week with the documentation they helped me gather. The peace of mind alone was worth it, but the refund I didn't expect was even better!
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Malik Jenkins
9 Something nobody has mentioned yet is that calling the IRS directly can sometimes help resolve back tax situations. I had unfiled returns for several years and was getting increasingly anxious about it. After weeks of trying to get through (constant busy signals or disconnects), I found https://claimyr.com and watched their demo at https://youtu.be/_kiP6q8DX5c. They basically hold your place in the IRS phone queue and call you when an agent is about to answer. I was able to speak with an actual IRS representative who helped me understand exactly which years I needed to file and why. They even set up a payment plan for the years I did owe money on.
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Malik Jenkins
•6 Wait, how does this actually work? The IRS barely answers their phones, and when they do, you're on hold for like 3 hours. Are you saying this service somehow jumps the queue?
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Malik Jenkins
•17 Sounds like a scam to me. Why would I pay someone else to call the IRS when I can just do it myself? And why would they have any better luck getting through than I would?
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Malik Jenkins
•9 It doesn't jump the queue at all. The service uses an automated system that essentially waits on hold for you. They call the IRS, navigate the menu options, and wait in the hold queue just like you would - but you don't have to sit there listening to the hold music for hours. You're right that anyone can call the IRS themselves - nobody's stopping you from sitting on hold for 2-3 hours if you prefer. I tried that approach multiple times and either got disconnected or couldn't stay on the line long enough because of work. With Claimyr, I went about my day and got a call back when an agent was about to pick up. Saved me an entire afternoon of waiting and frustration.
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Malik Jenkins
17 I have to eat my words about Claimyr. After being super skeptical, I decided to try it because I was getting nowhere with the IRS phone system. After 6 failed attempts trying to call them myself (either disconnected after 45+ minutes or couldn't stay on hold because of meetings), I gave in and tried the service. Got a call back in about 2 hours telling me an agent was about to pick up. The IRS representative I spoke with was incredibly helpful and walked me through exactly which years I needed to file and why. She even noted in my account that I was working to resolve the unfiled returns so there wouldn't be any aggressive collection actions. Totally worth it just for the peace of mind.
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Malik Jenkins
3 For what it's worth, when I applied for FAFSA last year, they only asked for my most recent tax year. But they do have a verification process where they sometimes randomly select people to provide more documentation. If you get selected and have unfiled returns, it could potentially delay your financial aid. The safest approach is to file everything, but if money is tight, focus on years where you might have actually owed taxes (like if you had self-employment income or did gig work).
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Malik Jenkins
•1 How can I tell which years I might have owed taxes without actually filing? My situation was pretty simple - just W-2 income with standard tax withholding, but I honestly don't remember the details from 5+ years ago.
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Malik Jenkins
•3 You can request a "Wage and Income Transcript" from the IRS which shows all reported income for a specific year. This will show your W-2s, 1099s, and other income documents that were filed. If you only had W-2 income with standard withholding, you may not owe anything, but you'd need to run the numbers to be sure. Another option is to request an "Account Transcript" which will show if the IRS has already created a substitute return for you and assessed any taxes. This can give you a clearer picture of which years need attention first.
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Malik Jenkins
13 As someone who works in financial aid at a university, I can tell you that FAFSA primarily looks at your most recent completed tax year for eligibility (which would be 2023 taxes for the 2025-2026 academic year). However, if there are discrepancies or red flags in your application, they may request additional information. Having unfiled taxes from previous years doesn't automatically disqualify you from aid, but it can complicate the verification process if you're selected. The bigger issue might be if you owe back taxes that result in a tax lien, as that can impact your credit which may affect certain types of educational loans.
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Malik Jenkins
•1 That's really helpful, thank you! So it sounds like for FAFSA purposes I'm probably okay since I've filed 2021-2023, but I should still consider filing the older years to avoid any potential issues with the IRS down the road. Do you know if scholarships or grants ever look at tax compliance?
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Malik Jenkins
•13 Most federal and institutional scholarships and grants follow FAFSA guidelines, so they primarily care about your current financial situation rather than past tax compliance. However, some private scholarships may have their own requirements, and occasionally they do perform background checks that could potentially flag tax issues. The bigger concern is indeed potential issues with the IRS. Even if you don't owe money, having unfiled returns can create problems years later - especially when you reach important financial milestones like buying a home, starting a business, or applying for certain jobs. It's generally best to clean up tax issues while they're relatively recent and documentation is easier to obtain.
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