Talk about raising red flags: If you're required to file a return and you don't, the IRS will hunt you down.
The agency has ways to identify people who have filed returns in the past but stopped filing, as well as people who have never filed a return. Once you're identified as a nonfiler, the IRS will want to know how much tax you owe and what you're hiding, said Dominique Molina, CPA and president of the American Institute of Certified Tax Coaches.
To avoid a confrontation with the tax man, it's better to simply file -- no matter how much you're dreading the deed, Molina said.
"Many taxpayers get overwhelmed particularly if they owe money they can't pay, and they stick their heads in the sand," said Molina.
But late payment penalties kick in as soon as the filing deadline passes, so if you don't file and get caught, you could end up having to pay a lot more than your original tax bill. If you're worried about not being able to pay your tax bill, there are installment plans available. Just ask the IRS what your best option is.
Of course, if you want to delay the pain a little longer, you can always file an extension. And if your income is below a certain level -- which varies widely depending on your filing status and age -- you're not required to file a return at all. But even if you don't have to file, make sure you're not missing out on any deductions or credits that could actually put a little extra money in your pocket.
"Many times people build up an irrational fear over filing their taxes and in fact are due a refund," said Molina.