PLEASE NOTE: To protect your health and safety in response to the threat of the COVID-19 Virus, we are offering our clients the ability to meet with us in person while maintaining social distancing, via telephone or through video conferencing. Please call our office to discuss your options.
Call Our Team Today

IRS on the verge of stepping up enforcement

| Oct 7, 2020 | blog

In the coming months, the IRS will proceed with its focus on high-income taxpayers who have yet to file their tax returns. The potential for significant penalties, limited voluntary disclosure options, and possible criminal prosecution is abounding.

The IRS issued IR-2020-34 on Feb. 19, 2020, where the IRS states that it will ” step up efforts to visit high-income taxpayers who in prior years have failed to timely file one or more of their tax returns.”  Armed with sophisticated data analytics to identify the high-income non-filers and businesses with large amounts of unpaid employment taxes, the IRS is on the move.

The IRS imposes substantial additions to tax for a failure to file a tax return. IRC 6651(a)(1)  And with fraud referrals from the IRS Collection Division on the rise, potential criminal consequences become even more real.  While it is a misdemeanor to failure to file a return, convicted taxpayers may be fined up to $25,000 ($100,000 for corporations) and up to one year in prison. See, IRC 7203.  Under IRC 7201, a willful failure to file, combined with affirmative acts of evasion, could lead to a potential felony conviction for tax evasion, which can result in up to five years in prison.