What to do if I haven't filed taxes for the past 2 years? Need advice on payment options

The good news is that filing late is better than never filing at all, and the IRS has several payment options for people in your situation. First, you need to file those tax returns ASAP regardless of your ability to pay. The failure-to-file penalty is typically much larger than the failure-to-pay penalty. File your returns even if you can't pay anything right now. Once you've filed, you have options: 1) Request an installment agreement with the IRS. Most people qualify for a long-term payment plan where you can pay your tax debt over time in monthly installments. 2) You might qualify for an Offer in Compromise if you truly cannot pay the full amount. This allows you to settle your tax debt for less than the full amount. 3) If paying would cause severe financial hardship, you can request Currently Not Collectible status, which temporarily delays collection. Interest and penalties will continue to accrue until the balance is paid, so it's best to pay as much as you can as quickly as possible. But don't let the inability to pay prevent you from filing those returns.

I was in almost the exact same situation last year and honestly it was overwhelming until I found this AI tax advisor called taxr.ai (https://taxr.ai) that helped guide me through the whole back-filing process. I had 3 years unfiled and was totally panicking about potential criminal charges or something crazy. The tool analyzed my situation and walked me through exactly which forms I needed for each year and how to approach the IRS about setting up a payment plan. It even has this document analyzer feature where you can upload any IRS notices you've gotten and it explains them in plain English. Helped me realize I wasn't actually in as much trouble as I thought! What made the biggest difference was how it helped me organize all my documentation from previous years - something I was totally lost with before.

I need to eat my words about taxr.ai from my previous comment. After my skepticism, I decided to try it anyway out of desperation (had 2 unfiled years like you). It actually helped me figure out that I qualified for some credits I had no idea about, which reduced what I owed by almost $3200! The document analysis feature saved me when I got a CP2000 notice that made no sense to me - it explained exactly what the IRS was claiming and helped me draft a response letter. The step-by-step guidance for filing my back taxes was surprisingly detailed and specific to my situation. Not saying it replaces a professional for complex situations, but for my relatively straightforward unfiled returns, it was exactly what I needed and much more affordable than the $1800 quote I got from a local tax resolution firm.

One thing nobody's mentioned yet is that calling the IRS directly can actually be really helpful in these situations, but good luck getting through to them! I spent 3 weeks trying to talk to someone about my payment options last year. I finally used this service called Claimyr (https://claimyr.com) that got me connected to an actual IRS agent in about 20 minutes when I'd been trying for weeks on my own. You can see how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent I spoke with was surprisingly helpful and walked me through applying for an installment agreement that fit my budget. They even helped me calculate what my monthly payments would be and explained how to request first-time penalty abatement which saved me about $800.

I hate to admit when I'm wrong but I have to update my comment about Claimyr. After dismissing it as BS, I was still desperate to talk to someone at the IRS about my unfiled returns, so I tried it anyway. It actually worked exactly as described. Got connected to an IRS agent in about 45 minutes (which is insane compared to my previous attempts). The agent helped me understand my options for the 3 years I hadn't filed and set up a payment plan that I could actually afford ($120/month). The most valuable part was that the agent told me I qualified for first-time penalty abatement since I had a clean record before these unfiled years. That saved me over $1,100 in penalties! I would never have known to ask for that on my own.

One thing to consider is getting your returns prepared professionally before submitting them. I did my back taxes myself using TurboTax and missed several deductions I could have claimed. A friend had H&R Block do his unfiled returns and they found nearly $4,000 in deductions he missed because he didn't know what to look for. If money is tight, look into the Volunteer Income Tax Assistance (VITA) program or the Tax Counseling for the Elderly (TCE) program which offer free tax preparation for qualifying taxpayers.

Has anyone actually received one of those scary "Intent to Levy" notices after not filing? I'm in a similar boat (3 years unfiled) and just got one of these notices that's freaking me out. Says they can seize property, bank accounts, etc!!!