Tax issues can affect all groups of taxpayers, no matter what tax bracket they fall into. In recent years, however, there’s been a concern raised about auditing practices and criminal tax investigations being disproportionately aimed at poorer individuals. In response, the IRS commissioner, Charles Rettig, went before Congress in April 2019 to express that the agency was aware of this problem and plans were in motion to begin performing more audits on more affluent taxpayers in the foreseeable future. That became evident in February 2020 when the IRS started implementing this new plan to ensure high-income earners are appropriately reporting and paying their taxes each year.
How Will the New Program Focus on High-Income Non-Filers?
The IRS issued a press release in February 2020 describing how this new program targeted at high-income taxpayers who haven’t filed their tax returns will unfold. High-income taxpayers are considered to be those who earn $100,000 or more each year. These individuals who have not filed a tax return in the previous years might expect to receive a personal visit from the IRS at their homes or businesses. Within the first two months of the program, the strategy was to conduct over 800 visits to high-income non-filers, followed by thousands more throughout the year.
The main objective of these visits is to notify taxpayers of their outstanding debts and bring them into compliance. According to Hank Kea, the director of field collection operations, small business/self-employed division, at the IRS:
“These visits shouldn’t come as a surprise to the taxpayer because the IRS has contacted these individuals multiple times regarding their tax issues prior to their cases being assigned to an IRS revenue officer.”
The IRS focuses first on non-filing high-income earners with the most grievous offenses, like those contacted several times regarding their neglect to file and have still failed to comply with the IRS’s efforts to collect taxes past due.
What Should I Do if I Failed to File a Tax Return in Previous Years?
If you fail to file a tax return in previous years, do not wait on IRS revenue officers to visit your home or business before resolving it. If the IRS contacts you personally regarding outstanding tax debt and unfiled tax returns, you can face significant civil penalties and harsh criminal penalties.
Failing to file a tax return is a criminal offense that’s considered a misdemeanor by the federal government and a felony under California law. If sentenced, non-filers can face up to one year in prison for each count of a non-filed tax year. According to the statute of limitations, authorities have five years to prosecute non-tax filers, so a conviction for this alone can land a person with a five-year sentence in jail.
If you’ve failed to file your tax return for the previous years, because of the criminal tax vulnerability involved, it is imperative that you contact a skilled tax debt attorney like Attorney Becky Rose Sebastian of Morgan Sebastian Law, PC right away.
How Can a Tax Debt Attorney Help?
An experienced tax debt attorney can help you resolve your tax debt issues and mitigate the prospect of the harshest potential penalties by working with the IRS so that past failure to file can be corrected. Fines for delinquent tax returns are steep, requiring five percent of the owed tax debt for each month the tax return is overdue, capping off at 25% of the overall amount.
A knowledgeable tax debt attorney can help mitigate tax penalties by:
Formulating a reasonable payment plan with the IRS to pay back tax debt and any imposed fines
Making sure that the IRS recognizes you are cooperating and there will be no reason to press criminal charges
In minimal cases, showing that your failure to file was the result of a reasonable mistake or misunderstanding and not due to willful neglect
These in-person visits will be with taxpayers who have formerly received notifications regarding tax debt but failed to reply. If you think the IRS has tried to contact you previously about non-filed years, you need to act exceptionally fast to secure a tax debt attorney as there may be an impending visit to your home or office.
The IRS has harsh penalties for not only those who fail to file their tax returns but especially those who have disregarded repeated efforts to contact them and inform them of their obligations. A skilled tax attorney can contact the IRS and other tax agencies and try to alleviate any damage you might have done.
Contact an Experienced Tax Debt Attorney in Orange, California, for Help with Unpaid Taxes
The IRS is intent on bringing high-income non-filing taxpayers into compliance with their tax requirements. Neglecting to file your tax return can be a criminal offense that might involve steep penalty fines and jail time if the matter is not swiftly resolved. If you’re considered a high-income earner and have failed to file a tax return for at least one year, you should partner with a knowledgeable tax debt attorney like Attorney Becky Rose Sebastian at Morgan Sebastian Law.
Morgan Sebastian Law is a tax debt law firm in Orange, California, representing taxpayers in all 50 states before the IRS. With extensive experience negotiating with federal and state tax agencies, she can help you reach the best resolution possible with your tax liabilities. To speak with Becky about your tax debt, call (877) 223-6605 to schedule a free consultation or complete our contact form.