Cases Involving Un-filed Returns

Putting things off!

No matter what we all say, all of us put things on the “backburner’ at some point or another but when it comes to the payment of outstanding taxes, this is a situation where this should not be done because by putting off filing or paying tax returns is fraud and the consequences are dire.

It is said by the IRS that around 10 million American’s each year fail to file their returns at all and it is so common, they are known as the “non filers” but it is no laughing matter because it can so easily be sorted but if it goes ignored then imprisonment and financial ruin is often the outcome.

With modern day technology such as the internet, it is becoming easier for the IRS to track down any non filers and if they are trying to find a particular person, then they almost certainly will whether it is through address on bank statements or employment pay slips, a person doesn’t just slip under the radar.

As these are major felonies, should you not file or pay tax returns then with the IRS’s “Substitute for Return” procedures, you could face a prison sentence based on the following:

A failure to file is classed as a misdemeanor which carries a maximum prison sentence of 1 years for each tax year
Tax evasion is classed as a felony against the state/country and this charge carries a maximum sentence of five years for each tax year missed

The Prosecution of Non-Filers

If an investigation into non-filers is to take place then this will be handled by the IRS Criminal Investigation Division and once it gets to this stage, people are prosecuted for the failure to file a return or the worst of all, tax evasion.

Overall, it is not the cheapest or easiest way of trying to obtain unpaid taxes and it could be used as more of a scare tactic to the person involved and to others, the IRS are willing to go all the way in order to secure funds that are by law, due to them.

Should a situation get to this stage then proper representation is vital and we can help try out and sort out what can potentially be known as an extremely delicate matter indeed.

Voluntary Disclosure Policy

In most cases and before severe consequences occur as a result of one’s actions, most problems relating to the filing of tax returns and payment of outstanding taxes can be addressed fully before the IRS start initiating due legal process.

A taxpayer has to get the missing returns filed immediately to avoid any risk of prosecution, known as “voluntary disclosure” policy. This is a policy, which has been around for years however; you need to be prepared for the IRS changing the rules slightly from time to time.

The most recent change was announced on 11 December 2002 in which any returns filed as a result of the “voluntary disclosure” policy must be 100% truthful and accurate or huge penalties will be enforced.

Should the IRS determine that a late-filed claim is indeed false then the chances of criminal prosecution are great and more likely to occur in the near future. The “voluntary disclosure” policy applies to a taxpayer who does the following:

• The failure to file a return for one year or more
• A single source of income only received from legal sources
• Made a voluntary disclosure prior to being informed of an active criminal investigation
• Makes a full payment or an arrangement to pay any outstanding amounts due
  

In such scenarios as this it is vital to move quickly and take all of the right steps to avoid further problems occurring. If it is done correctly then it can so easily be resolved but if not then there is a greater risk of being prosecuted and sent to prison so our advice, do it right first time but if you do need help then contact us for immediate assistance.