If you haven't filed a tax return in one year — or several — you're not alone. Life gets complicated. A business hits a rough patch. A death in the family. A divorce. Health problems. Sometimes taxes fall through the cracks, and before you know it, years have passed.
The good news is that filing back taxes in Maryland is very doable, and the sooner you start, the better off you'll be. Here's exactly what to do.
The IRS doesn't forget. Unfiled returns accumulate penalties and interest every single month. If you have W-2 income or 1099s on file, the IRS may have already filed a Substitute for Return (SFR) on your behalf — and they won't give you the deductions you're entitled to.
The longer you wait, the more you owe. Filing — even late — almost always results in a better outcome than doing nothing.
Maryland follows federal tax law closely, but also has its own penalties for non-filers:
If the IRS determines you owe taxes and you haven't filed, they can garnish wages, levy bank accounts, and file federal tax liens against your property.
Start by pulling your IRS tax transcripts. These show which years have returns on file and which don't.
How to get your transcripts:
For Maryland, check marylandtaxes.gov to see what the state has on record.
For each missing year you'll need:
Can't find old W-2s? Request a Wage and Income Transcript from the IRS — it shows all income reported to them by employers and clients for that year.
Work chronologically — oldest to most recent. This is important because:
Use the tax forms for the year you're filing, not current year forms. Tax laws change annually and you must use the correct year's forms.
If you owe money, get all returns filed before negotiating a payment arrangement. The IRS won't discuss payment plans with non-filers — you must be compliant first.
Once all returns are filed, you can:
Maryland and the IRS are separate entities. Filing your federal returns does not automatically file your Maryland returns. You'll need to file both — and Maryland will want its share too.
The Maryland Comptroller's office is generally willing to work with taxpayers who come forward voluntarily. Voluntary disclosure almost always results in reduced penalties.
The IRS generally requires 6 years of back returns for taxpayers who want to come back into compliance. However, if you're owed refunds, you can only collect on returns filed within 3 years of the original due date.
For criminal prosecution purposes, the IRS can go back indefinitely on non-filers — another reason not to wait.
Technically yes — but back tax situations are complicated. Common mistakes include:
A CPA with back tax experience can often reduce what you owe, protect you from aggressive collection actions, and make sure everything is filed correctly the first time.
At Mercer Flanagan, we've helped individuals and small business owners in Frederick, MD and throughout Central Maryland resolve years of unfiled returns. We know how to work with the IRS and the Maryland Comptroller's office to get you back in compliance — and keep more money in your pocket in the process.
We handle complex situations that other firms avoid. Whether you're one year behind or ten, we'll put together a plan and walk you through every step.
Don't wait another year.Call us at(301) 662-6992or visit mercerflanagan.com/contact to book a free consultation today.
Mercer Flanagan is a CPA firm founded in 1971 serving Frederick, MD and Central Maryland including Thurmont, Hagerstown, Mt. Airy, Walkersville, and Middletown.