Tax evasion is a federal crime, which means that the penalties you could face for a conviction are significant. It’s true that there are mistakes that you could make on your taxes that might look like tax evasion. However, making a mistake is different from intentionally defrauding the government.
When you attempt to defraud the government by avoiding taxes or assessments, then you could face penalties. Some common examples of tax evasion include:
- Failing to declare all your income
- Trying to avoid detection by failing to file tax returns
- Overstating your expenses or deductions
What kinds of penalties can you face for tax evasion?
The main penalty is that you’ll need to pay what you owe plus a failure-to-pay penalty. If you didn’t file, you’ll face a failure-to-file penalty.
You may also be asked to pay interest on the amount that you owe. The interest starts accruing at the due date of your return and continues accruing until you pay the amount you owe in full. This includes paying off interest and penalties assessed against your account.
On top of all this, you could face criminal charges for avoiding taxation. If convicted, there is a risk that you could face imprisonment. Tax liens are a possibility, as is having to give up to 15% of your Social Security benefit up to the Federal Payment Levy Program.
If you are accused of tax evasion, don’t go without the right information. Your attorney will work with you to protect you against the IRS and to prevent you from facing penalties that you can’t afford.