Back Taxes Attorneys
Experienced legal representation for back taxes matters across all 50 states.
About Back Taxes
Back taxes refer to taxes that were not fully paid in the year they were due, whether because of unfiled returns, underreported income, denied deductions, or simply an inability to pay. The IRS tracks unpaid tax obligations through a system of assessments and notices, and the consequences of unresolved back taxes escalate over time through penalties, interest, and increasingly aggressive collection actions. As of fiscal year 2023, the IRS reported that individual taxpayers collectively owed over $300 billion in assessed but uncollected taxes, making this one of the most common tax problems Americans face.
The back tax problem often begins modestly — a taxpayer misses a filing deadline, underestimates their quarterly payments, or faces an unexpected tax liability from a life event like selling property or receiving an inheritance. Without prompt attention, the situation compounds rapidly. The failure-to-file penalty accrues at 5 percent per month on unpaid taxes, up to 25 percent. The failure-to-pay penalty adds 0.5 percent per month. Interest compounds daily at the federal short-term rate plus 3 percentage points. A $10,000 tax liability can easily grow to $15,000 or more within two years through penalties and interest alone.
Resolving back taxes requires a systematic approach. A tax attorney first determines the full scope of the liability by obtaining transcripts from the IRS, reviewing all affected tax years, and identifying whether returns need to be filed or amended. From there, the attorney explores resolution options including full payment, installment agreements, offers in compromise, currently-not-collectible status, penalty abatement, or in some cases, challenging the underlying tax liability itself. Each option has specific eligibility requirements and strategic considerations, and the right approach depends on the taxpayer's financial circumstances, the age of the debt, and the IRS's collection posture.
Why You Need a Back Taxes Attorney
Unresolved back taxes do not simply go away. The IRS has powerful collection tools that can fundamentally disrupt your financial life. Federal tax liens attach to all of your property and assets, appear on credit reports, and make it difficult or impossible to sell real estate, refinance a mortgage, or obtain business financing. Tax levies allow the IRS to seize bank accounts, garnish wages, and take other property without a court order. In extreme cases, the IRS can revoke or deny your passport if you owe more than $62,000 in seriously delinquent tax debt.
Beyond enforcement, unresolved back taxes create a cascade of financial problems. Interest and penalties continue to accrue, increasing the total amount owed. Unfiled returns prevent you from receiving refunds you may be entitled to — the IRS imposes a three-year deadline for claiming refunds on late-filed returns. Outstanding tax debts can also affect your eligibility for government programs, professional licenses, and security clearances. Taking action to resolve back taxes — even when full payment is not immediately possible — demonstrates good faith and opens the door to resolution options that can significantly reduce your financial burden.
Common Back Taxes Cases
Unfiled Tax Return Preparation
Preparing and filing delinquent federal and state tax returns for one or multiple years, including reconstructing income records when original documents are unavailable.
Installment Agreement Negotiation
Securing monthly payment plans with the IRS to pay back taxes over time, including streamlined, non-streamlined, and partial-pay installment agreements based on financial capacity.
Currently-Not-Collectible Status
Obtaining a temporary suspension of IRS collection activity when a taxpayer demonstrates that paying the tax debt would create an economic hardship, allowing the statute of limitations to continue running.
Penalty Abatement Requests
Requesting removal of failure-to-file and failure-to-pay penalties based on reasonable cause, first-time penalty abatement, or statutory exceptions to reduce the total balance owed.
Tax Lien and Levy Release
Negotiating with the IRS to release, withdraw, or subordinate federal tax liens and to stop or reverse wage garnishments and bank levies that are creating financial hardship.
Substitute for Return (SFR) Correction
Replacing IRS-prepared Substitutes for Return — which typically overstate tax liability by omitting deductions and credits — with properly prepared original returns that reflect accurate tax obligations.
Statute of Limitations Analysis
Analyzing whether the IRS collection statute expiration date has passed or is approaching, and developing strategies to protect the taxpayer as the ten-year collection period runs.
Innocent Spouse Relief
Helping spouses obtain relief from joint tax liability when the other spouse improperly reported items or omitted income on a jointly filed return without the requesting spouse's knowledge.
Typical Back Taxes Case Timeline
Case Assessment & Transcript Analysis
1-3 weeksThe attorney obtains IRS account transcripts, wage and income transcripts, and any available return information to determine the full scope of the tax liability, including penalties and interest.
Unfiled Return Preparation
2-8 weeksIf returns are unfiled, the attorney coordinates preparation of all delinquent returns, reconstructing income and deduction records as needed. Filing compliance is generally required before the IRS will consider resolution options.
Financial Analysis & Strategy Selection
1-3 weeksThe attorney analyzes your income, expenses, assets, and future earning capacity using IRS financial standards to determine which resolution option offers the best outcome.
Application Submission
2-4 weeksThe attorney prepares and submits the appropriate application — whether an installment agreement request, offer in compromise, or currently-not-collectible hardship designation.
IRS Review & Negotiation
3-12 monthsThe IRS reviews the submission, may request additional documentation, and the attorney negotiates terms. Offers in compromise typically take 6 to 12 months for IRS processing.
Resolution & Compliance Monitoring
OngoingOnce the resolution is in place, the attorney ensures compliance with all terms, including timely payments and on-time filing of future returns, which is typically required for five years.
Know Your Rights
- You have the right to a Collection Due Process hearing before the IRS can levy your property for the first time on a particular tax debt, giving you the opportunity to propose alternative payment arrangements.
- You have the right to request currently-not-collectible status if paying your tax debt would prevent you from meeting basic living expenses as defined by IRS collection financial standards.
- You have the right to receive a notice before the IRS files a federal tax lien (Lien Notice) and before the IRS levies your property (Final Notice of Intent to Levy).
- You have the right to request penalty abatement if you had reasonable cause for failing to file or pay on time, such as serious illness, natural disaster, or reliance on professional advice.
- You have the right to appeal any IRS collection action you disagree with, including proposed levies, lien filings, and rejected installment agreement requests.
- You have the right to have the IRS consider your ability to pay when determining collection actions, ensuring that collection does not leave you unable to meet necessary living expenses.
- You have the right to know when the IRS collection statute expires, and the IRS generally cannot collect a tax debt after ten years from the date of assessment.
What to Look for in a Back Taxes Attorney
When seeking an attorney for back tax resolution, look for someone with substantial experience in IRS collection matters specifically. Tax preparation and audit representation are different skill sets from collection defense. Ask the attorney how many installment agreements, offers in compromise, and currently-not-collectible designations they have obtained in the past year. An attorney who regularly negotiates with IRS Collection should understand the financial analysis the IRS applies and how to present your financial situation most favorably.
Verify that the attorney performs a thorough initial analysis before recommending a strategy. Be cautious of firms that promise specific outcomes — such as settling your debt for pennies on the dollar — before reviewing your financial situation. Legitimate tax resolution requires careful analysis of IRS account transcripts, your income and expenses, and your asset equity. The right attorney will give you an honest assessment of your options and the likely range of outcomes. Also consider whether the firm handles unfiled return preparation in-house, as this is often a prerequisite to any collection resolution.
Questions to Ask Your Back Taxes Attorney
- 1Can you obtain my IRS account transcripts to determine exactly how much I owe, including penalties and interest for each tax year?
- 2Based on my financial situation, which resolution option — installment agreement, offer in compromise, or currently-not-collectible status — is most realistic?
- 3Do I have unfiled returns, and if so, do you handle return preparation or will I need a separate preparer?
- 4Are any of my tax years approaching the ten-year collection statute expiration date, and how does that affect our strategy?
- 5Can you stop an active levy or garnishment quickly while we work toward a longer-term resolution?
- 6What is the total estimated cost for your services through final resolution, and do you offer a payment plan?
- 7What are my obligations after the resolution — how long must I remain in compliance, and what happens if I fall behind?
Understanding Back Taxes Legal Costs
Back tax resolution attorney fees depend on the complexity of the case and the resolution strategy pursued. Initial consultations are typically free or cost $100 to $300. Preparation of unfiled returns generally costs $400 to $1,500 per return depending on complexity. Straightforward installment agreement negotiation typically costs $1,500 to $3,500. Currently-not-collectible status requests range from $2,000 to $4,000. Offer in compromise preparation and negotiation is the most involved process, typically costing $3,500 to $7,500 for the application and negotiation phase. If the matter involves lien or levy issues requiring immediate intervention, expect additional fees of $1,500 to $5,000. Many tax resolution firms offer payment plans for their own fees, recognizing that clients with back tax problems often face cash flow constraints.
Key Legal Terms
Video Resources
These videos are provided for informational purposes only. The attorneys and organizations featured are not affiliated with or endorsed by Northwind Law.
What Happens If You Don't Pay Your Taxes?
CNBC
IRS Collections Process Explained
Help From A Former IRS Agent
How to Deal with Back Taxes
The Tax Couple
Frequently Asked Questions About Back Taxes
Citations & Sources
- [1]As of the end of fiscal year 2023, the IRS had approximately 18 million taxpayer delinquent accounts representing over $300 billion in assessed but uncollected taxes. — IRS Data Book 2023
- [2]The failure-to-file penalty is 5% of unpaid taxes for each month a return is late, up to 25%. The failure-to-pay penalty is 0.5% per month, also up to 25%. — IRS Topic No. 653 - IRS Notices and Bills, Penalties, and Interest Charges
- [3]The IRS generally has ten years from the date of assessment to collect a tax debt. After this Collection Statute Expiration Date, the IRS can no longer legally pursue the debt. — IRC Section 6502
- [4]The IRS can certify seriously delinquent tax debt to the State Department for passport denial or revocation when the debt exceeds $62,000 (adjusted for inflation). — IRS, Revocation or Denial of Passport
- [5]First-time penalty abatement is available to taxpayers who have filed all required returns and have not been assessed penalties for the three prior tax years. — IRS First Time Penalty Abatement Policy
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