How to Find Out if You Owe Back Taxes

Back taxes are unpaid tax liabilities from a prior year. This can result from failing to file, underreporting income, or not paying the full amount due. Discovering if you owe back taxes is a proactive step that helps prevent further financial complications, including accumulating penalties and interest. Understanding how to access your tax records is the first step toward addressing any outstanding obligations and regaining control of your financial standing.

IRS Resources for Checking Tax Balances

The Internal Revenue Service (IRS) offers several ways to check your tax account status and outstanding balances. These resources provide secure, direct access to your tax information, allowing you to review your history and current obligations.

The IRS Online Account is a convenient way to review your federal tax information. By creating an account, you can access data from your most recent tax return, including Adjusted Gross Income (AGI). You can also view your balance due, payment history, and digital copies of IRS notices. To set up an account, you will need:

A valid email address.
A mobile phone with a camera.
Government-issued photo identification (such as a driver’s license or passport).
Your Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).

Identity verification through ID.me may involve uploading a photo ID and taking a video selfie.

You can also request tax transcripts from the IRS. These free transcripts summarize your tax return information, not photocopies of your original returns. Several types are available, each serving a different purpose.

A Tax Return Transcript displays most line items from your original Form 1040-series tax return as filed, including your AGI, and is available for the current and three prior tax years. A Tax Account Transcript provides basic data like filing status, taxable income, payment types, and changes made after your original return was filed.

This transcript is available for the current and up to ten prior tax years online or with Form 4506-T, or up to three years by mail or phone. The Record of Account Transcript combines both the Tax Return and Tax Account transcripts.

You can request these transcripts online through the IRS Get Transcript tool for immediate viewing and downloading if you have an IRS online account. You can also “Get Transcript by Mail” through the IRS website; it will be mailed to your address on file within five to ten business days. For paper requests, Form 4506-T, Request for Transcript of Tax Return, can be mailed to the IRS. This form is often used when a third party, such as a lender, needs to verify your income information. For mail or Form 4506-T requests, provide your SSN, date of birth, and the mailing address from your latest tax return.

Direct contact with the IRS is another option. You can reach the IRS by phone at their toll-free assistance line, 1-800-829-1040 for individuals. Phone wait times can be substantial, especially during peak tax season, but allow direct interaction with a representative. Be prepared to verify your identity when calling. For inquiries via mail, you can send correspondence to the IRS, though this method generally has longer response times compared to online or phone interactions.

Gathering Necessary Information

Before accessing your tax account information through IRS resources, gather specific personal and financial details. Having this information ready streamlines identity verification and helps you obtain records. Preparing these documents beforehand helps prevent delays.

You will need your full legal name, Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN). Your date of birth is also required. These details help the IRS locate and verify your tax records.

Information from previous tax returns, especially your Adjusted Gross Income (AGI) from a prior year, is important for identity verification. The IRS uses this figure to confirm your identity when you create an online account or request transcripts. Having copies of past tax returns is advisable, as they contain AGI figures and other financial data. Your current mailing address and phone number are also required. If your address changed since your last return, you may need to provide your previous address for verification.

Any IRS notices or correspondence you have received can be valuable. They often contain account numbers, notice numbers, or tax years that can narrow your inquiry. For instance, a CP14 notice indicates a balance due and provides details about the amount owed. If you lack previous tax returns or other documents, you can get W-2s or 1099s through a Wage and Income Transcript. For a full copy of an old tax return, you would need to submit Form 4506, Request for Copy of Tax Return, which involves a fee and a longer processing time.

Understanding Your Tax Account

Once you have accessed your tax account information, interpreting the details is next. These documents contain codes and figures indicating your tax liability. Understanding these elements clarifies the nature and extent of any back taxes owed.

On IRS transcripts or notices, you will find an account balance, representing the total amount due. This balance includes original tax owed, plus accrued penalties and interest. Common notices for balances due include CP14, which signifies a balance due for an unpaid amount on a filed return. CP501 or CP503 serve as reminders, while LT11 or CP504 may indicate final notices before collection actions.

Identifying the specific tax year(s) for which back taxes are owed is important. Transcripts and notices indicate the tax period, usually near the top. This helps pinpoint the exact year(s) and cross-reference with your records. The tax account transcript is useful as it shows changes made after the original return was filed, helping trace new liabilities.

Distinguish between the actual tax owed, penalties, and interest, as they contribute differently to the total balance. Penalties are imposed for failing to file or pay on time. The penalty for failing to file is 5% of the unpaid tax for each month or part of a month the return is late, up to 25%. The penalty for failing to pay is 0.5% of the unpaid tax for each month or part of a month, also up to 25%.

Interest is charged on unpaid tax, including penalties, from the original due date until paid. The IRS updates its interest rates quarterly, basing them on the federal short-term rate plus 3%, and interest compounds daily. Review the information for accuracy; if discrepancies are found, further investigation may be necessary.