The deadline to pay your taxes is days away.
That can lead to interest, fees and in extreme cases, possible jail time.
The tax agency will give you the opportunity to address the issue before it escalates to this extreme.
But there are legal consequences for tax evasion or continuously failing to pay your taxes on time.
Read more:Is Your Tax Return Over $1,000?
It’s a criminal act that can lead to severe consequences, including jail time.
The IRS treats such cases as criminal offenses because they involve intentional deceit.
This may be because of a financial hardship or errors in yourtax withholding.
Honest mistakes or late payments generally lead to IRS penalties and late fees, not prison.
If you might’t pay your taxes on time, the IRS doesn’t immediately resort to extreme measures.
Instead, the agency will begin sending notices that outline your balance and explain how it was calculated.
Depending on what your letter entails, interest and penalties may also start accruing.
The IRS typically starts withaudits, collection letters and then repayment options.
While prison sentences for unpaid taxes are rare, they are possible.
Pro Tip
Watch out for tax scams.
The IRS will never initiate contact via phone or email.
The IRS will always begin with mailed notices, which include instructions and contact information.
If you’re unable to pay your full tax bill, don’t panic.
The IRS offers payment plans thatyou can set up onlineor with your tax preparer.
This agreement lets you settle your debt with the IRS for less than your tax bill.
When you’re filing your tax return, ensure you double-check the income you’re reporting.
You’re responsible for any errors or omissions, even if they were accidental.
The IRS provides adirectory of qualified tax professionalsthat can be helpful when you don’t know where to start.
