- If the IRS (US tax authority) owes you money, there’s no penalty for not filing taxes (3-year window to claim refund).
- However, not filing taxes when you owe money is a misdemeanor (up to $25K fine, 1-year in prison).
- While being imprisoned is unlikely, IRS penalties are up to 5% of the amount owed (up to 25%) per month.
- Experts recommend immediately filing returns for each year missed.
- While short-term plans require repayment within 120 days, the IRS is open to installment plans.
