What happens if you dont file taxes?

i didnt file taxes for over five years straight and nothing happened. chances are that under your circumstances you will be fine. just don't turn it into a habit like i did.

If you don't owe any money filing is optional.

Was your employer taking any money out for Fedaral a State?

of course.

Wrong dudeVery wronghttp://www.irs.gov/faqs/faq2-1.htmlTable 2. 2006 Filing Requirements for Dependents See Exemptions for Dependents to find out if you are a dependent. If your parent (or someone else) can claim you as a dependent, use this table to see if you must file a return. In this table, unearned income includes taxable interest, ordinary dividends, and capital gain distributions. Earned income includes wages, tips, and taxable scholarship and fellowship grants. Gross income is the total of your unearned and earned income. Caution. If your gross income was $3,300 or more, you usually cannot be claimed as a dependent unless you are a qualifying child. For details, see Exemptions for Dependents. Single dependents¡ª Were you either age 65 or older or blind? ¡õ No. You must file a return if any of the following apply. Your unearned income was more than $850.Your earned income was more than $5,150.Your gross income was more than the larger of ¡ª $850, orYour earned income (up to $4,850) plus $300.

malmo wrote:

If you don't owe any money filing is optional.

They may let you have your books in prison. They might even be tax deductible.

SonnyB wrote:

Wrong dude

Very wrong

No you're VERY wrong. The IRS doesn't even hid this information. It's all there is the Tax code.

There is no penalty for not filing UNLESS you owe taxes. You are not even required to file at all. The IRS can only assess penalties and interest on taxes owed. No taxes owed = NO penaty. No taxes owed = NO interest.

If you do not file, you have three years to file to get your refund.

They'll get you sooner or later.

Malmo is wrong technically, but practically it makes no difference if you file or not if you do not owe any taxes....I have filed late previously but all of the interest and penalties are figured on a percentage of money owed. Therefore if you don't owe anything there are no interest or penalties.

It may catch up to you administratively at some point or another. Maybe.

i think malmo's right. but i'm too lazy to look it up, and i'll readily acknowledge being wrong if someone finds something authoritative saying filing a return is required if you have x amount of gross income (with x being below or near the OP's gross income).

if you are owed a refund, why would the IRS care if you didn't claim it?

There is no technicality here, Mr Obvious. It's the code.

If you do not file the IRS has 3 years to file for you.

If you are owed a refund, they will send you a notice, however you cannot receive a refund unless you file yourself. When you do finally file, they will send you your refund plus interest.

If you do not file and owe taxes, they will penalize you 5% of the taxes due for each month late filing to a maximum 25%. You will be charged a penalty on interest (0.5% per month), on top of the accrued interest.

If you file, and owe taxes but do not pay, they will charge you interest plus the interest penalty (0.5% per month)

kaitainen wrote:

i think malmo's right.

I know I'm right. We go through this every April 15.

Obviously the IRS is going to figure your taxes with a simple return, so if your filing is at all more complicated, they might determine you owe money, triggering collections, but all you have to do is file and the game is over.

The important thing here is that I'm not telling anyone to not file. I am saying, not to sweat it if you are owed a refund on a simple return.

I'd bet that 50% of the people who rush to get there taxes in by the deadline are oblivious to the simple fact that there is no deadline if you are owed a refund.

Do you have a source Malmo? That other guy at least had a link to the IRS FAQ. Just wondering...

The 5% penalty is 4.5%(late filing) + 0.5%(late paying). With a maximum of 25% penalty. If you file but do no pay the penalties will accrue for up to 50 months to hit the 25% ceiling. The 25% penalty ceiling is there no matter how you get there.

http://www.irs.gov/taxtopics/tc653.html

April 15th is the deadline for most people to file their individual income tax return and pay any tax owed. If the due date falls on a Saturday, Sunday, or legal holiday, the due date is delayed until the next business day (i.e., Tax Year 2006 is due April 17, 2007). Tax returns are checked for mathematical accuracy. If there is any money owed, you will be sent a bill. Generally, interest is charged on any unpaid tax from the due date of the return until the date of payment. The interest rate is determined every three months and is the federal short–term rate plus 3 percent. Interest is compounded daily. If you file on time but don't pay all amounts due on time, you'll generally have to pay a late payment penalty of one–half of one percent of the tax owed for each month, or part of a month, that the tax remains unpaid from the due date, until the tax is paid in full or the 25% maximum penalty is applied. The one–half of one percent rate increases to one percent if the tax remains unpaid 10 days after the IRS issues a notice of intent to levy. For individuals, who file by the return due date, the one-half of one percent rate decreases to one-quarter percent for any month in which an installment agreement is in effect.

If you owe tax and don't file on time, the total late–filing penalty is usually four and one-half percent of the tax owed for each month, or part of a month, that your return is late up to five months. If your return is over 60 days late, the minimum penalty for late filing is the smaller of $100 or 100 percent of the tax owed.

You must file your return and pay your tax by the due date to avoid interest and penalty charges. Often the funds necessary to pay your tax can be borrowed at a lower effective rate than the combined IRS interest and penalty rate.

To ensure your payment on a bill for tax is credited properly, be sure to return the tear–off stub on your bill and use our return envelope. Please make your check or money order payable to the United States Treasury. Enter the primary social security number or employer identification number, the tax year and form number and your telephone number on your check or money order.

The penalties for filing and paying late may be abated if you have reasonable cause. If you're billed for either penalty and feel you have reasonable cause, send your explanation along with the bill to your service center, or call the IRS at 1–800–829–1040 for assistance. Generally, interest charges may not be abated; they continue to accrue until all assessed tax, penalties, and interest are paid in full. Generally, any reasonable cause exception to the penalty for failure to pay tax cannot be determined until the tax is first paid in full.

If you believe there is an error on your notice or bill, write to the IRS office that sent it to you within the time frame given. You should provide photocopies of any records that may help correct the error. Also, you may call the number listed on your notice or bill for assistance. If you are correct, we will make the necessary adjustment to your account and send you a corrected notice.

For more information about IRS notices and bills, refer to Publication 594 (PDF), Understanding the Collection Process. More information about penalty and interest charges is contained in Chapter 1, Filing Information, of Publication 17, Your Federal Income Tax.

Never mind - I found this myself

http://www.irs.gov/individuals/article/0,,id=96623,00.html

It has a step by step to tell you if you have to file or not

Rob an old lady? Probation.

Hold back money you owe the government? Jail.

malmo wrote:

I know I'm right. We go through this every April 15.

LOL! As I was reading this thread I was thinking to myself that I've seen almost a carbon copy of this thread in prior years.

Curious Jorge wrote:

It has a step by step to tell you if you have to file or not

As you can see, for most people it begins and ends at the first question.

--------------

* Did you have Federal taxes withheld from your pension and wages for this tax year and wish to get a refund back?

* Are you entitled to the Earned Income Tax Credit or did you receive Advance Earned Income Credit for this tax year?

* Were you self-employed with earnings of more than $400.00?

* Did you sell your home?

* Will you owe any special tax on a qualified retirement plan (including an individual retirement account (IRA) or medical savings account (MSA)? You may owe tax if you:

o Received an early distribution from a qualified plan

o Made excess contributions to your IRA or MSA

o Were born before July 1, 1935, and you did not take the minimum required distribution from your qualified retirement plan.

o Received a distribution in the excess of $160,000 from a qualified retirement plan.

* Will you owe social security and Medicare tax on tips you did not report to your employer?

* Will you owe uncollected social security and Medicare or Railroad retirement (RRTA) tax on tips you reported to your employer?

* Will you be subject to Alternative Minimum Tax (AMT)? (The tax law gives special treatment to some kinds of income and allows special deductions and credit for some kinds of expenses.)

* Will you owe recapture tax?

* Are you a church employee with income in wages of $108.28 or more from a church or qualified church-controlled organization that is exempt from employer social security or Medicare taxes?

BaconBros wrote:

LOL! As I was reading this thread I was thinking to myself that I've seen almost a carbon copy of this thread in prior years.

What's the saying about groundhog day all over again? You be right.

malmo wrote:

If you are owed a refund, they will send you a notice, however you cannot receive a refund unless you file yourself. When you do finally file, they will send you your refund plus interest.

I'm pretty sure you DON'T get interest on a refund, although they will sure as hell charge it if you owe. It's an unfair one-way street.