Not paying taxes can sometimes just be an accident. Often, we see people who forgot to pay taxes one year. This turns into several years. Then the perso ndoesn’t have enough money to pay what they owe. Now you’re wondering if you can go to jail.
The short answer is maybe. You can go to jail for filing. You can go to jail for lying. The thing you can’t go to jail for – is not having enough money to pay your taxes.
Making a mistake on your tax return won’t result in jail. Most tax liabilities are civil, not criminal. If you’re audited and it looks like you owe, then a civil judgement is placed on you – to get the money. You can only go to jail if criminal charges are filed, and you are prosecuted. The most common tax crimes are those of fraud and evasion. Evasion occurs when you used illegal ways to avoid taxes. Claiming more children than you have is an example. It means you intentionally tried to deceive the IRS. This is different than being confused, and placing numbers in the wrong line.
The IRS is more forgiving when it comes to people who can’t pay, versus non-filing. Late filing penalties are much higher than late payment penalties. The IRS won’t put you in jail for not being able to pay your taxes if you file the return. The follow actions can land you in jail for 1-3 years:
Tax Evasion: If you tried evading the assessment of tax, such as filing a fraudulent return – this can land you in prison for 5 years
Failure to file: Failure to file can land you jail for one year, for each year
Helping someone evade: This can carry a 3-5 year prison sentence.
Criminal Charges – Statute of Limitations
If the government is interested in filing charges, it has to act fast. Criminal charges can only be brought 3-6 years of the violation. The clock doesn’t start until you file your return.
What if you can’t pay
If you can’t pay, you should consider a payment plan.
You can qualify for an individual installment agreement – if you owe less than $50,000 in tax + interest + penalties combined. This involves regular monthly payments. If you owe more than $50,000, you can still get an installment agreement – but there’s more paperwork involved. You can also setup an offer in compromise – which is an agreement between you and the IRS to settle your liabilities for less than the amount owed.
Todd is a miracle worker who will work tirelessly for you and your family. He is one of the few attorneys i've met - who I earnestly trust to protect me, and who I am happy to refer to our friends and fellow family members. The Spodek Law Group is someone you want on your side, because they will treat you just like family. Todd and his team are available 24/7, and they always answered our calls. Even when we were being irrational, and crazy - they were calm and super helpful. Just call Todd. He gives you a free consultation and is very understanding.- Donna & Robert
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