Are you also avoiding filing tax returns due to heaps of paperwork that make you nauseous? This move is not right, and I will definitely bite back. Do you know that you can even go to jail for not filing your taxes? Yes, you read that right! Let’s get into further details.
What Is the IRS and When Can They Send You To Jail?
IRS stands for The Internal Revenue Service and is the revenue service for the U.S federal government. It is Responsible for collecting U.S. federal taxes. The IRS has criminal prosecution proceedings for people who actually commit tax fraud or tax evasion. Both are serious criminal offenses that can result in jail time if prosecuted by the IRS.
Going to Jail for Not Filing Taxes
It is possible to land in jail if you do not file taxes properly or attempt to not file them. There are some important pointers to consider:
Deliberate Tax Evasion vs. Honest Mistake
Simply not having enough money to pay your taxes does not lead to imprisonment. Similarly, making an honest mistake on your tax return due to complicated tax forms is unlikely to result in criminal charges against you.
Failure to File vs. Failure to Pay
Another difference is between failing to file a tax return on the whole and failing to pay the full amount owed. Neglecting the obligation to file tax returns by the due date is considered more serious by the IRS. This can lead to up to 1 year in jail for each year you did not file.
On the other hand, the IRS is generally more lenient with those who file their taxes; however, are unable to pay the full amount. This is as long as they make an effort to resolve the debt.
What Can the IRS Not Send You to Jail For?
The institution prioritizes collecting taxes owed. Jail time is for situations where there is clear evidence of intentional wrongdoing.
- Simple Mistakes: The IRS understands that there is always room for human error. Whether it is a math error on your tax return or an unintentional overlooking of a certain form, the IRS will send you an intimation to rectify the situation, especially if you come clean.
- Financial Hardship: Sometimes, paying taxes becomes difficult due to unforeseen circumstances. While it is a rule for penalties and interest to accumulate on unpaid taxes, the IRS offers various options to help you get back on track, such as installment agreements or Currently Not Collectible (CNC) status.
- Late Filings: Procrastination is a common trouble in recent times, and the IRS knows it. While penalties and interest are assessed for late filings, forgetting to file or missing a deadline is considered a civil offense, not a criminal one.
The IRS prioritizes collecting owed taxes and criminal investigations are only initiated by intentional attempts to mislead the organization. Ignoring IRS notices about unpaid taxes or discrepancies, stalling an audit, or tampering with records are all red flags and can put you in jail.
Closing Note
In case you find yourself in a situation where you need legal guidance, our skilled attorneys at Edwards Sutarwalla Samani LLP are here to help. Our teams are led by experts such as George Edwards III, a founder and partner with extensive experience in personal injury. He, along with our other skilled lawyers, can provide you with legal advice and representation where needed. Do not hesitate to contact us at (713) 565-1353 to schedule a consultation.