What Happens if You Don't File Taxes?

What Happens If I Don't File a Tax Return for a Few Years?

 The Balance / Chelsea Damraska

Tax season can be stressful, but the average taxpayer does manage to file their tax returns on time. But what happens if you don't file your return? The companies you work for provide your income information to the Internal Revenue Service (IRS), so the IRS has a good idea of what you earned and what you owe.

The IRS will use that information to file a "substitute for return" on your behalf if you don't file a tax return yourself. Learn what takes place when this happens, and what you need to do.

Key Takeaways

  • The IRS will file a return on your behalf if it has reason to believe you’ve received income that you haven’t reported.
  • The IRS is aware of all income for which you received a Form W-2 or Form 1099 because it receives copies of these forms. 
  • Your substitute tax return won’t include any deductions or tax credits you might be eligible for, so it’s likely that you’ll end up owing more tax or receiving less of a refund than you would have if you had filed your own return.
  • Your best option might be to file a tax return for that year within 30 days, but you can also petition the Tax Court if you believe the substitute return isn’t accurate. 

How a Substitute of Return Works

Suppose you're a self-employed graphic designer. You work for various companies as an independent contractor. These firms send you copies of 1099-NEC forms each year to report the income they've paid to you. They send the originals to the IRS.

You neglect to file your 2022 and 2023 tax returns. The IRS computer will notice this. The computer will then pull all tax documents regarding your income that it has on file and the IRS will use them to calculate the tax you owe. The IRS will send you at least one letter and possibly more after it generates your substitute of return.

The Assessment Letter

You'll likely find out that the IRS has prepared a substitute tax return for you when you receive an assessment letter in the mail. The letter tells you the proposed amount of taxes you owe based on the information the IRS has: typically W-2 forms, 1099 forms, and other tax documents on file.


The letter will summarize the sources of income that the IRS used to calculate the tax due.

The IRS gives you 30 days from the date of the letter to take one of three actions. You can:

  • Send in a signed, completed tax return.
  • Send in a signed and dated response form included in the letter, along with your payment for the tax the IRS says you owe.
  • Call the IRs and explain why you aren't required to file a tax return.

Notice of Deficiency

The IRS will send a second letter, a Notice of Deficiency, if you don't respond to the assessment letter in time. This one is sent by certified mail, which means you'll need to sign and acknowledge receipt of the letter when it arrives.

The IRS mails this notice because it's going to proceed as though the proposed tax assessment detailed in their first letter is correct. It will take whatever actions are necessary to collect any unpaid tax, penalties, and interest.

Be sure to read it carefully if you receive this notice. The IRS gives you 90 days (150 days if you're outside the country) to take one of the following actions:

  • File an original tax return.
  • File a petition with the U.S. Tax Court to challenge the deficiency notice.
  • Call the IRS and explain why you don't think you have to file.

How Does the IRS Calculate the Tax?

It's likely that the IRS's calculation of the tax you owe will be much higher than it should be because it won't include any of the tax breaks you'd normally qualify for and claim. The IRS will prepare a substitute return that's in the best interest of the government.

Your initial assessment letter will explain what you owe, and any penalties and interest the IRS is charging you. The IRS will owe the taxpayer a refund in some cases. Provided that the time limit hasn't passed, the taxpayer can still get a refund or have that refund applied to any outstanding balance due that they owe the IRS.

Statute of Limitations for Refunds

The statute of limitations for refunds is three years from the original filing deadline for the return. The refund "expires" if the return is filed outside this time limit. The IRS can't reissue the refund back to you, nor can it apply the refund to an outstanding balance from another year. It can't apply the refund as an estimated payment to a future tax year, either.

Be Prepared to Wait

It could be several weeks to several months—sometimes as long as 10 months to a year—before the IRS finishes processing the tax returns that were finally filed, but it will hold off on trying to collect the tax while it's doing so. As long as the IRS has received the original returns and they're being worked on, it will put a temporary hold on the matter."


You should continue to make any payments on plans you've set up with the IRS if you owe outstanding balances for other years.

What To Do If the IRS Files a Substitute Return

Track down as much documentation as you can if you find yourself in this situation. This might include:

  • Any notices or letters from the IRS
  • Any tax forms or documents, such as W-2s, 1099s, mortgage interest statements, interest income
  • A tally of your business income and expenses if you're self-employed
  • The last tax return you filed

Gather up all these documents, or as many of them as you can find. Make an appointment with a tax professional, preferably one who specializes in these kinds of situations. If you can't find certain income forms like W-2s or 1099s, you might be able to get them from the IRS. They can be acquired from the wage and income transcript. But your expenses and any credits or itemized deductions would have to be recreated from bank statements or receipts.


Gather as many documents as you can, then meet with a tax professional to sort through everything.

Questions To Ask

Taxpayers should ask four questions of any tax professional when they're trying to deal with substitute returns:

  • How many years of unfiled tax returns should be filed?
  • If the IRS does owe you money, will you receive it?
  • Should you mail in the tax returns or hand-deliver the returns to an IRS walk-in location?
  • Who will be working with you from start to finish? Is this matter going to be passed off to someone else?

Ask what licenses the tax professional has, and how they price their services. Ask them to put together a project plan with deadlines, and ask about their preferred method of communication. Some are most easily reached by phone, while others prefer email. Some might ask that you drop by for an in-person meeting.

Frequently Asked Questions (FAQs)

How long can you go without filing tax returns?

You can generally go about as long as it takes for the IRS to issue a substitute for refund and contact you about it via an assessment letter. The IRS can eventually take action to recover what you owe if you fail to respond to the assessment letter.

Can you get into trouble for not filing all your tax returns?

Yes. You could face criminal penalties for tax fraud if the IRS believes you willfully hid or misrepresented some of your taxable income

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. IRS. "Notice CP2566 R English."

  2. IRS. "Notice of Deficiency."

  3. IRS. "Understanding Your CP3219N Notice."

  4. IRS. "Filing Past Due Tax Returns."

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