Tax Defense ✦ Non-Filers
Years Behind on Your Returns? The Way Back In Matters.
Every non-filer eventually faces the same choice: keep waiting for the letter, or get current on your own terms. Getting current is the right answer, but the order and method matter, especially in Colorado, where the Tenth Circuit’s late-return rule affects what can be discharged later. North Star Law Firm prepares the returns in-house and builds the resolution plan before the first one is filed.
Overview
Getting current without making it worse
The IRS knows more than most non-filers assume: every W-2, 1099, K-1, and 1098 is on a wage and income transcript, and after enough years the IRS files substitute returns and assesses tax on the gross figures. Coming into compliance starts with those transcripts, which tell us the income the IRS expects to see, the years it considers open, and whether substitutes have already been filed. From there we prepare the returns as CPAs, file them in a sequence that captures refunds and limits exposure, and move directly into resolving the balances. The Colorado returns are prepared from the same workpapers.
- Wage and income transcripts pulled for every open year
- Returns prepared in-house, federal and Colorado
- Substitute-for-return assessments replaced with accurate returns
- Refund years filed before the deadline closes
- Exposure evaluated under privilege before anything is filed
- Voluntary disclosure where the facts call for it
- Resolution plan (payment plan, offer, or bankruptcy) built in advance
- Bookkeeping cleaned up so the current year is filed on time
Colorado and the Tenth Circuit
The late-return rule changes the plan
In In re Mallo, 774 F.3d 1313 (10th Cir. 2014), the court held that a return filed after its due date is not a return for bankruptcy discharge purposes, so the tax on a late-filed year generally can never be discharged, no matter how long you wait. Colorado is in the Tenth Circuit, and that rule shapes every non-filer engagement here. If some of your years were filed on time and some were not, the on-time years may be dischargeable while the late years are not; if a bankruptcy is realistic, its timing has to be planned around the returns being filed now. The one exception is a return the IRS prepares with your cooperation under I.R.C. § 6020(a), which is rare but can be requested in the right case. We map the years before filing so you don’t foreclose an option you didn’t know you had.
The Attorney-CPA Difference
The returns and the resolution come from the same desk.
Most tax resolution firms send the returns out to a preparer and handle the aftermath. We prepare them ourselves, which means the numbers on the return are chosen with the resolution in mind: which years to claim depreciation, how to document reconstructed expenses, whether to amend a substitute-for-return year or accept it. It also means the conversation about what the returns will show is privileged from the first meeting.
- Returns prepared by the same professional who negotiates the outcome
- Reconstructed books for years with no records
- Sequencing planned around refund deadlines and the Mallo rule
- Colorado returns filed from the same workpapers
- Current-year systems set up so the pattern ends
Questions & Answers
Unfiled Tax Returns questions, answered
How many years do I have to file?
The IRS generally requires the last six years to be considered in compliance, though it can require more where a large balance is involved. Colorado’s assessment period stays open indefinitely for an unfiled year. We pull your wage and income transcripts to see what the IRS already knows, then decide which years to file and in what order.
The IRS filed a return for me. Is that the end of it?
No. A substitute for return under I.R.C. § 6020(b) uses only the income the IRS knows about, allows no deductions beyond the standard, and treats you as single. Filing an accurate original return replaces it and usually cuts the balance sharply. One caution for Colorado filers: a return filed after a substitute for return is a late return under the Tenth Circuit’s Mallo decision, so the tax on it generally cannot be discharged in bankruptcy. That affects how we sequence the case.
Will I be prosecuted?
Voluntary compliance before the IRS contacts you is the strongest protection there is, and criminal referrals for ordinary non-filers who come forward are rare. Where there is exposure, such as unreported cash income or foreign accounts, we evaluate it before anything is filed and, if warranted, use the IRS’s voluntary disclosure practice. That evaluation is privileged; the same conversation with a preparer is not.
Can I still get a refund for old years?
Only within three years of the original due date (federal) or four years (Colorado). Refunds for older years are forfeited even though the return is still required. Filing the refund years first is part of the strategy.
What happens after the returns are filed?
The balances become collectible, which is when the resolution work begins: an installment agreement, an offer in compromise, penalty abatement, or, for older years with timely-filed returns, bankruptcy. Filing without a plan for what comes next is the most common mistake we see.
Talk to an attorney-CPA before you talk to the IRS.
A free consultation, a plain-English assessment, and a flat fee in writing if you decide to move forward.