The penalty for late filing is 5% per month of the taxes owed, 25% maximum. Interest
is the federal
reserve short-term rate
plus 3%, compounded daily, on the unpaid tax due.
Once you file all of the returns, you can attempt to set up an installment
payment plan, or make an offer in compromise for a lump sum. You can also consider filing bankruptcy
after 240 days for any return on which the filing date is at least three years past due. I don't know if bankruptcy is an option, but it may get rid of 5 years worth of your tax return obligation.
The IRS does not want to prosecute anyone for a criminal violation. However, eventually, if you do not file, then that's what will happen, so the sooner you file, the better off you are.
Also, for any return where you do not owe taxes, the minimum penalty for late filing is $100 ($135 for returns required to be filed after 2008). So, if any return shows a loss or breakeven, then that would be good.
Hope this helps and happy new years.
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