If you haven’t filed your tax return in years, you might think the IRS has forgotten. But when they haven’t received your return, they may take action on their own by preparing one for you—called a Substitute for Return, or SFR.
While this may sound helpful, it’s not. In fact, letting the IRS file an SFR on your behalf can cost you thousands, trigger collections, and lock you out of deductions and credits you legally deserve.
At Back Tax Rescue, we help clients across Georgia resolve problems caused by IRS-filed returns and restore their financial future. This guide explains what SFRs are, how they work, and how to fix the damage before it’s too late.
🧾 What Is a Substitute for Return (SFR)?
A Substitute for Return is a tax return the IRS prepares for you when you fail to file. They base it solely on income data reported by employers, banks, and other third parties (like W-2s and 1099s). The result?
- No deductions
- No credits
- No expenses
- Highest possible tax owed
📌 The IRS prepares SFRs to protect their interest—not yours. Their goal is to collect, not to minimize your liability.
⚠️ What Triggers an SFR?
An SFR may be filed if:
- You have missing returns for one or more years
- You owe back taxes
- You’ve ignored multiple IRS notices (like CP59, CP63, or LT3219)
- You are self-employed and haven’t filed returns despite income being reported under your SSN or EIN
Once the IRS completes an SFR, they’ll issue a Notice of Deficiency—giving you 90 days to respond or file your own return before collections begin.
❌ The Dangers of an SFR Filing
Here’s why you should never let an SFR stand unchallenged:
1. You Lose Deductions & Credits
The IRS doesn’t include:
- Business expenses
- Charitable donations
- Education credits
- Mortgage interest deductions
- Child Tax Credit
- Standard or itemized deductions
You’re taxed on gross income only, not your net income.
2. You’ll Owe More Than You Should
Because they don’t know your actual financial picture, the IRS overestimates your tax bill—often doubling or tripling what you truly owe.
3. Enforcement Begins Automatically
Once the IRS files an SFR and assesses the tax, they can issue:
- Wage garnishments
- Bank levies
- Tax liens
- Passport restrictions
4. Penalties and Interest Accumulate
In addition to a higher tax bill, you’ll also be hit with:
- Failure-to-file penalties
- Failure-to-pay penalties
- Compounding daily interest
5. It Stalls Your Resolution Options
An SFR freezes the possibility of:
- Applying for an Offer in Compromise
- Entering into a reasonable payment plan
- Claiming a refund you may have been owed
You can’t resolve what you don’t file yourself.
✅ What You Should Do If an SFR Was Filed
If you’ve received a notice that an SFR has been filed (like Letter 2566, 3219, or CP2566), here’s what to do:
Step 1: Don’t Ignore the Notice
You typically have 90 days from the date of the notice to respond before the IRS finalizes the assessment.
Step 2: Prepare and File the Original Return
Even if the IRS filed an SFR, you still have the legal right to file your own return for that year—one that includes your real deductions and credits.
Step 3: Work With a Tax Professional
You’ll need to accurately reconstruct records, pull income transcripts, and complete the return carefully to prevent further issues.
Step 4: Request Abatement or Adjustment
Once the original return is accepted, you can request:
- A revised tax assessment
- Relief from penalties
- Removal of enforcement actions, like wage levies
👨💼 How Back Tax Rescue Fixes SFR Problems
We specialize in helping taxpayers fix the damage caused by Substitute for Returns. Here’s how we help:
- ✅ Pull IRS wage & income transcripts
- ✅ Reconstruct missing records and expenses
- ✅ File accurate back returns for all SFR years
- ✅ Communicate directly with the IRS on your behalf
- ✅ Negotiate payment or settlement terms
- ✅ Request reversal of penalties and enforcement
We’ve helped clients across Lawrenceville, East Point, and Alpharetta cut their SFR balances by more than half—just by submitting accurate, original returns.
🏠 Real-World Example (Fictionalized)
Tamara from Johns Creek hadn’t filed taxes in 7 years. The IRS filed SFRs for four of them, showing she owed over $48,000.
We recovered her income history, found missed deductions, and submitted four corrected returns. Her actual liability dropped to $12,000—and we secured a monthly payment plan of just $160.
📞 Stop the IRS From Controlling Your Tax Outcome
If the IRS has filed a return for you—or you suspect they might—take control now. The longer you wait, the more you’ll owe.
📞 Call Back Tax Rescue: 470-699-1187
📧 Email: info@backtaxrescue.com
🗓️ Schedule a Free SFR Case Review »
We’ll fight for your numbers—not the IRS’s.
