What is the Average Jail Time for Tax Evasion in the US?

Originally Published January 7th, 2020

One of the most-feared situations of most people is having tax problems with the IRS. Most people think that not filing taxes on time and accurately means jail time.

Well, it’s true. The average jail time for tax evasion in the US ranges between 3 to 5 years, plus the fines that come with it. The IRS states,

“Any person who willfully attempts in any manner to evade or defeat any tax imposed by this title or the payment thereof shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, shall be fined not more than $100,000 ($500,000 in the case of a corporation), or imprisoned not more than 5 years, or both, together with the costs of prosecution.”

It looks like the IRS is pretty serious about tax evasion. But, truth be told, not everyone who doesn’t pay their taxes gets sent to jail. Some people who really can’t pay their taxes are not forced by the IRS to pay.

However, if you can afford to pay your taxes but you deliberately not to, then IRS can and will file charges against you.

TYPES OF TAX EVASION

The IRS will have to conduct an investigation first before they can accuse you of tax evasion. As many people say, “innocent until proven guilty.” Here are some examples of tax evasion practices:

  • Failure to file returns
  • Failure to pay employment withholding taxes
  • Filing of false returns
  • Overstating tax deductions
  • Understating income/assets
  • Sales tax fraud

Once you’re proven guilty with these practices, IRS can pursue in charging you of tax evasion.

Computing for taxes.

TAX EVASION VS. TAX AVOIDANCE

Some people confuse tax evasion with tax avoidance. Both might seem the same, but these two are very different from each other.

Tax evasion is purely and will always be illegal. It uses unlawful acts and methods to avoid proper taxes.

On the other hand, tax avoidance uses legal means to lower your obligations as a taxpayer. For example, involving yourself in a charity that is an approved entity lessen your taxes. Putting your income to tax-deferred investments can be a method as well.

Deferring your taxes through IRA or 401k, you can delay the payments of your taxes until the funds on the investment are already available.

IS TAX EVASION A CRIMINAL OFFENSE?

Unlike FBAR violations and tax frauds which are only considered as civil offenses, tax evasion is a criminal offense. (Related: Top Five Prisons For White-Collar Criminals)

Therefore, the government should prove that you are guilty beyond a reasonable doubt.

But as mentioned earlier, not every tax evaders are being sent to jail. Just because the IRS can pursue a criminal action doesn’t mean that they will.

IRS only has limited staff and resources. With lots of tax evaders in the US, IRS often resort to civil investigations to save time and resources and see where it gets.

WHAT YOU CAN DO

There are ways on how you can prove that you’re innocent and somehow made a mistake in filing your taxes. Seeking help from a criminal defense attorney is always best for they can give you the best advice to avoid being a convicted felon. (Related: Average Jail Time For California Burglary Offenses)

REDUCE YOUR JAIL CALL COSTS BY 90%

GlobalTel’s inmate calling service lowers jail call rates by 90% for jail calls to US facilities. Sign up for our service to eliminate the long distance jail call fees for $45.99 for 90 days. Make US/domestic and international jail calls at the local rate and stay connected to your incarcerated loved ones for less. Learn more about how to sign up for calls from inmates on our website.

Franchette Agatha an author for GlobalTel

ABOUT THE AUTHOR

Franchette Agatha Jardin believes that everyone has the capacity to help those who are in need. She writes blogs about issues and news surrounding those in prison in the hopes of restoring a little extra faith in humanity.