Haven't filed taxes for several years? What to do

First there was no time, then it felt scary, and now three or four years are missing. It happens a lot, and there's a clear way out. The main rule: the sooner you file on your own, the cheaper it is.

No tax due means no late-filing penalty

The failure-to-file penalty is based on unpaid tax. If you were owed a refund for a year, there's no penalty. But there's a different problem: a refund can only be claimed if you file within three years of the due date. Refunds for older years are simply lost.

If you owe tax

• failure to file: 5% of the unpaid tax for each month late, up to 25%;
• if the return is more than 60 days late, the minimum penalty is $525 (for returns due in 2026) or 100% of the tax, if less;
• failure to pay: 0.5% a month, and it keeps growing after the filing penalty maxes out;
• interest on the tax and penalties.

The filing penalty is ten times the payment penalty. So even if you can't pay right away, file.

How many years to file

Technically the IRS can ask for every missing return. In practice, its internal policy is usually to require the last six years. The exact set of years depends on your case and is best decided after you see what the IRS has on file for you.

What happens if you wait

The IRS receives your W-2s and 1099s and can prepare a return for you (a substitute for return). It won't include your deductions and expenses, so the tax is usually much higher than the real amount. Then comes a Notice of Deficiency — the letter with a hard 90-day deadline.

Where to start

1. Download transcripts from your IRS.gov online account. The Wage and Income Transcript shows every W-2 and 1099 the IRS received.
2. Gather what isn't on them: self-employment income, expenses, family details.
3. File, starting with the years where a refund is due and the deadline hasn't passed.
4. If you can't pay at once, set up a payment plan; it's a standard process.
5. Ask about penalty relief: with no problems in the prior three years, the IRS often removes one year's penalty under First Time Abate.

Don't forget your state: in California the FTB works much the same way and can also prepare a return for you.

What not to do

• file only the current year and skip the past ones — the IRS will still ask for them;
• wait for it to "go away" — the statute of limitations doesn't start on returns that were never filed;
• pay the first letter without checking the numbers.

Catching up on several years is routine work, and it almost always costs less than people fear. I'll work out which years to file and in what order.

Sources: IRS: Filing past due tax returns, IRS: Failure to file penalty, IRM 1.2.1 (Policy Statement 5-133), IRS: First Time Abate. Checked October 26, 2026.