"Forget" to file a tax return? You'd be well-advised to remember to do so, and quickly.
It's much more common than you might think. We have countless clients walk through our doors, asking what they should do when they haven't filed a tax return in several years (and in some cases, MANY years). Many are shocked to learn that their only concern isn't the amount that will be due and payable to the IRS after the accountants prepare and file these returns. A much bigger concern in some cases is the potential criminal liability that attaches when taxpayers purposefully don't file a tax return. Under I.R.C. section 7203, willfully failing to file a tax return is a crime punishable by both heavy fines and possible prison time (maximums of $25,000 and 1 year in prison for each year for individual taxpayers), in addition to having to pay the appropriate tax, penalties, and interest.
While many think that the IRS doesn't waste their time with "regular Joes" and instead focuses their time chasing the famous celebrities who commit tax crimes, that is simply not the case. Certainly, the government has more to gain from a return on investment perspective when it focuses its resources on pursuing those with very large pockets (and very large tax bills), but the IRS and Department of Justice make sure not to discriminate when it comes to applying our nation's tax laws. Just this past week, the Department of Justice has issued releases related to multiple convictions of average Americans for various tax crimes. The link below is just one of those cases, and it serves to illustrate the point in a case where a small business owner in Connecticut pled guilty for failing to file tax returns for a number of years.
At The Wilson Firm, we help navigate those with both civil and criminal tax issues through the legal process. While there are a number of ways to handle any single case, taxpayers should know that they will be much better off seeking legal assistance in order to try and resolve these matters before the IRS knocks on their door, rather than waiting and crossing their fingers.