Even if you’ve wooed Cher like Nicholas Cage in Moonstruck, crooned a big hit like Stardust’s Willie Nelson, or been an American skiing sweetheart like Lindsey Vonn, you’re no match for the IRS. Whether A-list or Z-list, evading taxes is a crime. Though it’s nice to know that sometimes celebrities really are just like us. Even if you’ve let your taxes slip through the cracks for the past few years, there’s still time to file back taxes – and here are three reasons why you should.
You Probably Won’t Get Away With It
If the stories of our celebrity friends weren’t enough, there’s this sobering piece of tax denying news from NBC: “No tax protester [who ended up in court] has ever avoided their tax liability. Prison maybe, but they still end up owing the tax,” emphasizes Jay Adkisson, an attorney and editor of Quatloos.com, a Web site dedicated to exposing tax scams. “They also owe the cost of their legal defense, interest, penalties and often end up paying many times over the actual tax that was due,” he adds.
In other words, no matter what, you will wind up needing to pay your taxes (and if you’re charged and sent to court, you’ll pay a lot more besides).
Filing, Even Late, Saves You Money
Sounds counterintuitive right? (Especially if one reason you may have overlooked your taxes was to save money in the first place.) But if you don’t file, the IRS will kindly estimate your tax liability – or what you owe – for you. And they won’t be generous with deductions and exemptions. Actually, they won’t account for any of those.
In other words, choosing to voluntarily file your taxes lets you have a little more control in what you’ll owe.
Steer Clear of Penalties and Interest
When you finally do file your taxes, if you’re to receive a refund, you actually won’t be charged a penalty – pretty sweet deal, and a great reason to file. Of course, if you owe money, it’s possible you’ll be charged a failure-to-file or failure-to-pay penalty (plus interest!) no matter what. Those charges actually grow daily though, so the faster you file, the less you’ll owe.
In other words, you’ll be penalized far more the longer you wait to file your taxes.
Not paying your taxes may seem like small potatoes, but the ramifications are huge. Consider the case of one more celebrity who didn’t want to pay his taxes: Wesley Snipes. After three unpaid tax returns, he owed the IRS over $17 million in back taxes and interest…and was then sentenced to three years in prison besides. Let this Blade star’s story serve as a cautionary tale – and of course, Let’s Meet On TaxConnections if you’d like help getting started.
Original Post By: Barry Fowler