People fail to file tax returns for a variety of reasons — personal or business problems; feelings of hopelessness or fear due to an extended period of nonfiling; anti-government sentiments; or beliefs that the penalty will not outweigh the expense and trouble of filing. Because the U.S. tax system is based on taxpayers willingly honoring their obligations, the Internal Revenue Service (IRS) does what it can to encourage nonfilers to voluntarily come forward after a period of not paying taxes. Part of this strategy includes taking a voluntary disclosure into consideration when determining whether to criminally prosecute, negotiating payment installment plans, and reducing tax liability for certain needy individuals. Whatever your reason for not filing, you may want to consider the following information in order to be prepared for actions that may be taken against you. Knowingly declining to file a tax return, or refusal to pay what is owed after filing a return, can be a criminal violation of the law commonly referred to as “tax evasion.” You may have heard about notorious gangsters like Al Capone being convicted of tax evasion, which is often used against those who operate illegal enterprises. But anyone who refuses to file a tax return or pay taxes may be charged with this serious crime. Failure to pay taxes or file a return is itself a crime. However, the IRS would rather work with you and reach a settlement before seeking criminal charges. If you derive your income from illegal sources, it is more likely that the IRS will recommend prosecution (and further investigation into illegally obtained income could also result in fraud or racketeering charges). The more blatantly fraudulent your behavior has been, the more likely the IRS is to prosecute you. For example, you would likely be prosecuted for failing to file returns year after year, despite repeated contacts by the IRS. In order to convict you of a tax crime, the IRS does not have to prove the exact amount you owe. But such charges most often come after the agency conducts an audit of your income and financial situation. Sometimes they’re filed after a tax collector detects evasion or fraud. In any event; if the IRS suspects criminal nonpayment (or underpayment) of taxes, it will start with a “primary investigation” to determine whether criminal charges should indeed be filed. If the case progresses, the IRS will initiatiate a “subject criminal investigation.” The special agent in charge of a particular investigation will work closely with IRS legal counsel to ensure it’s following protocol and properly identifying the legal issues involved. Finally, the IRS will refer the case to the Justice Department’s Tax Division. What to Expect if You Don’t Pay Your Taxes: Non-Criminal Actions If you do owe taxes, you can probably work out an installment plan to pay off your debt. You also may be able to negotiate a settlement with the IRS, depending on your ability to pay, that will significantly diminish your overall tax debt. In some cases, the IRS may owe you money. Tax Lawyer Free ConsultationWhen you need legal help with tax law, please call Ascent Law for your free tax law consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506 via Michael Anderson https://www.ascentlawfirm.com/what-happens-if-you-dont-pay-taxes/
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About MeIn 2009 I was creating marketing channels for barbie dolls in Nigeria. Spent a weekend implementing dogmas in Naples, FL. Won several awards for writing about toy trucks in Mexico. Spent 2001-2007 analyzing deodorant in Pensacola, FL. Spent 2001-2004 researching heroin in Miami, FL. Enthusiastic about writing about clip-on ties in Naples, FL. Archives
June 2019
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