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What are the consequences for not paying your taxes?

On Behalf of | Jan 6, 2023 | Tax Debt |

Paying taxes is an unavoidable part of life in the United States. You must file a yearly tax return with the Internal Revenue Service and pay the tax owed.

Whether you fail to file altogether or do not pay what you owe, failing to pay your taxes comes with consequences.


If you fail to pay your taxes by the due date, you will incur a penalty based on the amount you owe. The penalty is one-half of one percent of what you owe for each month that you do not pay, with a maximum penalty of twenty-five percent of what you owe.

Wage garnishment

The IRS has the power to seize part of your wages until you pay your tax debt. The wage garnishment will continue each period until you make arrangements with the IRS to pay your overdue taxes.

Passport problems

In cases of serious overdue taxes, the U.S. Department of State can revoke your passport and prevent you from traveling. If you are overseas, you may be eligible for a limited-use passport that will allow you to return home.

Property liens

The government can file a federal tax lien on your property if you fail to pay taxes. The lien will remain on your property until you pay off your debt.

While rare, the IRS does pursue criminal charges in cases of tax evasion when a taxpayer hides assets or knowingly misreports their income. Tax evasion is a felony offense and a jail sentence of up to five years is possible.