Austin Tax Blog


If you may have failed to file taxes for a number of years then you are certainly in the radar of the taxation department. If audited and found guilty of hiding taxes, you would be liable for huge penalty and imprisonment in worst cases. The best way to avoid such hassles is to spend on systematic tax preparation, file tax returns and pay taxes regularly. For this, you need to hire tax services provider in Austin and follow his/her advice.

One thing that needs to be made clear is that you are fined if you fail to file tax returns but not if are unable to pay the taxes. The government and the IRS are considerate enough to help you figure out alternatives to spread our tax payments or deal with an Offer in Compromise to ease the burden of tax payment. Therefore, you are certainly not put under criminal offence and send to jail if you are ready to pay taxes but are unable to do so.

How Tax Preparation Helps You Avoid Penalty?

Tax liability is considered civil issue:

Tax payers in Austin can certainly take a breather as tax liability is considered as a civil offence and not criminal offence. You would not be sent to jail if you forgot to file tax returns or are unaware about it. In addition, if you show financial incompetence to pay taxes then again you would be forgiven under the civil court or they would suggest taking help of tax experts and resolving the matter through an IRS Offer in Compromise. However, if you are proven guilty of tax evasion i.e. hiding taxes purposely or if you try to deceive the IRS then you should be prepared for some really strict action against you. This includes hefty fines and an order for tax evasion jail term.

Actions that may result in jail punishment:

Tax evasion: Filing fraudulent tax returns or hiding the actual income in order to deceive the IRS.

No tax return riling: If you do not file tax returns every year then it may lead to imprisonment for each year you didn’t file tax return.

Assist in tax evasion: This holds true for all tax services providers who indulge in false practices of tax preparation to save their clients from tax payments. Even bookkeeping service providers can fall in this category and are subjected to punishment.

Efficient tax preparation minimizes tax payments:

There are always ways to deal with unpaid taxes and competent tax preparation is one of the best ways. As per tax experts in Austin, if you have not paid taxes yet then you need to check whether you fall into the Statute of limitation. According to this rule, the IRS gets ten years for collecting delinquent taxes and if it fails to do so then you no longer need to pay them. Secondly, the taxation authorities have to prove criminal charges within three to six years of the violation of law. If this time period is lapsed then you are no longer under their scrutiny as they have failed to do their duty and not you. Therefore, you need to hire tax professionals that ensure efficient tax preparation in a manner that you don’t fall into legal clutch.

Tax preparation helps you crack a payable deal:

If you have gone through severe business losses or are broke then tax services providers in Austin can help you manage things well. They will minimize tax payments by filing an IRS Offer in Compromise, which is a mechanism to negotiate a payable amount within a specified time based on your current financial health. A tax expert can help you with an installment plan to pay delinquent taxes on a monthly basis.

To conclude, professional tax preparation helps you in dealing with the tax courts and saves you from punishment liable for your tax mischief. However, the best advice is to not take tax file return for granted and practice best ways of bookkeeping. By paying taxes you are helping the development of your nation and so, don’t shy away from it.

Escobar & Associates are leading tax services provider in Austin. We offer tax preparation for businesses and individuals and are pro at our job. If you need any help in resolving taxation issues or filing tax returns then feel free to consult us at or call our team of tax experts on 512-442-3055.