A few reasons why filing your past due tax returns now is better than procrastinating.

Did you know 1 out of 5 people owe the IRS money? Many of us dread filing our taxes but it is a necessary evil in the world we live in today. In most cases lenders want your most recent tax return if you are trying to buy a house or get financing for your business. Here are 5 reasons why you should file.

1) Claim your refund - This is all to common. You pay in taxes through your employer and or are self-employed and pay in estimated tax payments. But you don't file and now you can't claim your entitled refund because it is past the 3 year time frame.

2) Avoid additional interest and penalties - Did you know the IRS charges daily compounded interest on any outstanding balances you owe? When you file a late return you get assessed interest and late filing penalties.

3) Social Security & Self Employed - Many self - employed people don't realize or don't correlate when you don't pay in your estimated taxes you are also not funding your own social security account. Visit SSI.gov to see how much you have contributed throughout your lifetime.

4) Financing & Loans - By not filing your taxes in a timely manner can often delay getting approved for financing. If you are in the market for a home this year or next year but haven't filed your returns yet, do so now. Keep in mind if you file and owe a tax balance and can't pay it. Many lenders will still approve you if you enter into a installment agreement with the IRS. Keep in mind also tax liens are very common if you owe over a certain amount of back taxes usually over $25k.

5) Substitute For Return - The IRS can file a tax return on your behalf if you have not filed for a few years. However, they won't give you any credits and or exemptions you may be entitled to. When you receive a notice from the IRS saying "Hey we filed for you and you owe us this much." It is best to file your returns. Keep in mind the IRS has ten years to collect on any past due balances.