The IRS cannot send you to jail and cannot file criminal charges against you if you don't pay your taxes. For example, if you use a credit card or loan to pay your tax bill, the interest may be lower than the IRS penalties you would face. Once the e-filing deadline has passed, it's too late to file taxes online, but it's not too late to file taxes on paper forms and send them by mail. Having the IRS file a tax return on your behalf may seem convenient, but you'll likely owe a lot more taxes than you would have if you filed a return yourself.
Interest accrues on the outstanding balance and accrues daily from the due date of the return (regardless of any extension for filing it) until the balance is paid in full. Fortunately, if the tax agency files an SFR and evaluates the taxes, you won't have to pay the amount it says you owe. These include deliberately hiding bank accounts or other IRS records or not reporting additional expenses on your taxes. For the first month, instead of imposing a 5% penalty for not filing the return plus a 0.5% penalty for non-payment, the IRS would apply a 4.5% penalty for late filing plus a 0.5% non-payment penalty, for a combined total of 5%.
We may be able to eliminate or reduce some penalties if you acted in good faith and we can show that there are reasonable reasons why you were unable to meet your tax obligations. They also have deadlines for filing tax returns to request tax refunds and what to do if you can't pay the taxes you owe. However, if the IRS files an SFR and you don't respond, the IRS will begin its collection process, which includes collecting your salary or bank account and filing a federal tax lien on your property. The IRS bases its SFR on its W-2, 1099 and other available tax forms, but most of them provide information about your income, but not your deductions.
However, they can prosecute those who are actively trying to evade taxes by illegal means, such as hiding assets or income. The non-payment penalty applies if you don't pay the taxes you declare on your tax return before the due date or if the extended due date has been approved. If both penalties apply to you during the same month, the penalty for not filing the application is reduced by 0.5% per month.
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