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I Did Not File My Tax Return. What Can the IRS Do to Me?
by: New Orleans Legal Assistance
Q.	Can I Go to Jail if I Did Not File My Tax Returns?

A.	It is a crime not to file your tax return if you owe taxes. The IRS generally has up to 6 years to prosecute you for this crime. The IRS generally does not prosecute the average citizen for non-filing. Each year, only about 200 persons are indicted for failure to file a tax return. The IRS is more interested in getting its money than putting you in jail. If you have not filed your returns, you increase your chances of not being criminally prosecuted if you file your returns before the IRs finds out about you. Consult with a lawyer on how to file your returns. Many non-filers worry about criminal prosecution for nothing. Studies show that about 30% of all non-filers do not owe taxes. Failure to file a tax return is only a crime if you owed taxes. Many low-income persons will not owe taxes because of the Earned Income Credit.

Q.	How Long Does the IRS Have to Collect Taxes From Me?

A.	If you did not file a tax return, the IRS can collect taxes from you for that year no matter how long ago it was. The voluntary filing of a tax return will start the running of a 3 year limit for the IRS to determine your tax debt and a 10 year limit for the IRS to collect. However, the IRS generally does not go back more than 6 years. Generally, the IRS will only try to get you for the last 6 years of taxes. It could get more if it wanted to, but usually it only goes after 6 years.

Q.	Can the IRS Charge Me Extra for Not Filing My Tax Returns?

A.	Generally, you will owe penalties and interest in addition to the back taxes. The penalties can be high if you have not filed for many years. They could be almost half as much as the taxes you owe. In addition, interest runs at about 8% to 10% per year.

Q.	Can I Do Anything to Lower How Much I Have to Pay the IRS?

A.	You may be able to lower what you have to pay the IRS by working out an Installment Agreement or Offer-in-Compromise. However, the IRS will not consider an Installment Agreement or Offer-in-Compromise until you have filed all of your tax returns. You can get old tax return forms from the IRS web page.

Q.	I Am Retired. What Can the IRS Take From Me?

A.	The IRS can take your retirement funds and 15% of your Social Security. It can also take your house if your tax debt is greater than $5,000.


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	Last Reviewed On: 04/03/03

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