Do You Want Your Tax Challenges To Make You An Example?
You’ve worked hard in your profession and in your business and your success has brought you recognition and notoriety. When you go to the club or out to dinner, you get treated differently because of who you are. The same could be true when you have a tax challenge. Only in this case, the IRS might want to make an example out of you. According to CNNMoney.Com: “Prevention seems to be the most effective way for the IRS to get its money. The best tactic? Setting examples of celebrities who run afoul of tax laws.”
Penske Racing's Helio Castroneves, Willie Nelson, and Wesley Snipes are three examples of successful people whose tax challenges have made the papers and been on TV. Doctors, securities brokers, loan officers, businessmen, dentists, pastors, salesmen, owners of businesses, accountants and attorneys are all prominently identified by their profession on the IRS website detailing 2009 tax fraud investigations.
Failing To File Your Tax Return Is A Crime
Most people have heard of the civil money penalties and interest for failing to file their tax returns: the failure to file penalty and the interest that is owed on the amount that they did not pay. They think that the worst thing that can happen is that they have to give the IRS more money when they finally straighten things out.
Warning: it is a crime to not file your return.
Wesley Snipes found out this out the hard way. Wesley Snipes is reported to have originally have been charged with federal tax fraud and conspiracy as well as the charges for failing to file a return. He was convicted of failing to file his returns for three years. 26 USC §7203 states that willfully failing to file a tax return is a misdemeanor federal offense and those convicted shall be fined not more than $25,000 ($100,000 in the case of a corporation), or imprisoned not more than 1 year, or both, together with the costs of prosecution. Snipes continues to appeal his conviction.