TIGTA: IRS Fails to Crack Down on Those Who Fail to File Income Tax

tax attorneysThe Internal Revenue Service is known for its relentless pursuit of people it believes are cheating on their taxes. But a new report from the Treasurer Inspector General for Tax Administration (TIGTA) says the IRS should do a better job of hunting down people who don't file their federal income tax returns.

The report has the snappy title one expects in government: “Improvements to the Nonfiler Program Could Help the Internal Revenue Service More Effectively Address Additional Nonfilers Owing Billions of Dollars in Taxes.” Even if it will never top bestseller lists, the report's content is worth considering - especially if you missed the October 15 filing extension deadline.

According to CPA Practice Advisor, TIGTA did an audit to find out how effective the IRS is enforcing filing requirements on those taxpayers who get extensions. Apparently, the IRS failed to ID and notify about 1.9 million people whose extensions lapsed and who did not file returns.

Those taxpayers owe about $7.4 billion in taxes (as of May this year), TIGTA said.

TIGTA also noted that high-income non-filers were considered high-priority by the IRS, yet none of them with expired extensions were notified of their failure to file and their owed taxes in 2012 or 2013.

In 2014, the IRS vowed to do better with non-filers with a new strategy to improve compliance. TIGTA says that as of July of this year, none of the IRS's initiatives had been implemented.

While some of this might be considered favorable news by non-filers, the reality for many is that they are on borrowed time. Failure to file can be considered a criminal tax matter in some cases.

With the help of an experienced tax law firm, like Robert J. Fedor Esq., LLC in Chicago and Cleveland, our tax attorneys can let you know what happens if you fail to file tax returns and return you to compliance and peace of mind.

Download IRS Criminal Tax Fraud eBook