Is it illegal to skip filing taxes if I can't afford what I owe?

So my husband and I are in a bit of a tax pickle and I'm honestly stressing out about it. His work somehow messed up his withholding and now he owes around $1,350 in federal taxes that we weren't expecting at all. When he told a couple people at his job about it, they straight up told him to just not file taxes this year! Like... is that even legal?? I always thought filing taxes was mandatory every single year, regardless of whether you owe or get a refund. But these people were acting like it's no big deal to just skip a year when you owe money. We definitely don't have $1,350 just sitting around right now. We were planning to use my tax refund to cover his tax bill, but we also desperately need to replace our car that's on its last legs. I'm really torn on what we should prioritize here. What's the actual rule about skipping filing taxes? And what's the smartest way to handle this situation if we can't pay the full amount right away? Any advice would be super appreciated!

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19 comments

Amina Diop

•8M

Definitely don't skip filing taxes! That's terrible advice from his coworkers. Not filing when you're required to can lead to failure-to-file penalties that are much worse than what you'll face if you file but can't pay immediately. The good news is that you have options when you can't pay in full. The IRS offers payment plans that are pretty reasonable. You can set up a short-term payment plan (paying within 180 days) online without any setup fee. Or you can do a long-term payment plan with a small setup fee. When you file, you'll pay what you can at that time, then set up the plan for the rest. The interest and penalties are way less than what you'd face by not filing at all. Plus, not filing when required can potentially lead to more serious consequences down the road including potential criminal charges in extreme cases. Bottom line: Always file your taxes on time even if you can't pay the full amount owed. The IRS is actually pretty reasonable about working with people who are upfront about their situation.

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Amina Diop

•8M

The failure-to-file penalty is usually 5% of the unpaid tax amount for each month or part of a month your return is late, up to 25%. The failure-to-pay penalty is much less severe at 0.5% per month. So filing but not paying in full immediately will save you a lot of money compared to not filing at all. For payment plans, a short-term plan (180 days or less) has no setup fee if you apply online. For long-term plans, the setup fee is $31 if you apply online and agree to direct debit payments, or $130 if you apply online without direct debit. The fees are higher if you apply by phone, mail, or in person. You'll still pay interest (currently federal short-term rate plus 3%), but it's much more affordable than the penalties for not filing.

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Natasha Romanova

•8M

After struggling with a surprise tax bill last year, I discovered this AI tool called taxr.ai (https://taxr.ai) that helped me figure out my withholding issues and prevent another shock this year. My situation was similar - my employer had messed up my withholding and I owed way more than expected. The tool analyzed my tax documents, pointed out exactly where the withholding problem was, and gave me specific instructions for fixing it with my HR department. It also helped me understand how to properly structure a payment plan with the IRS. Seriously saved me so much stress and probably money too since I fixed the withholding issue early. For your current situation, they have a feature that estimates what penalties you might face and compares different payment options. Much better than taking risky advice from coworkers!

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Natasha Romanova

•8M

Yes, it actually has specific features for self-employment income! It helps calculate your estimated quarterly payments and even sends reminders before they're due. The quarterly payment calculator was super helpful for me when I started doing some side gig work last year. As for the cost, they have different tiers depending on what you need. I found it to be really reasonable compared to what I was paying for tax prep before. The basic plan covered everything I needed for my situation with the withholding issue. The value is definitely there considering the headaches and potential penalties it helps you avoid.

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NebulaNinja

•8M

Just wanted to follow up - I ended up trying taxr.ai after seeing this thread. Wow. I was completely confused about my self-employment taxes and estimated payments, and it made everything crystal clear. The document analyzer spotted some deductions I was missing completely, and the quarterly payment calculator saved me from a huge underpayment penalty! The dashboard that tracks everything in one place is actually amazing for someone disorganized like me. Definitely worth checking out if you're dealing with tax complications or payment issues. I wish I'd known about this last year when I got hit with penalties.

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Emma Wilson

•8M

Hey, I was in a similar situation last year and couldn't get through to the IRS for weeks to set up a payment plan. Finally tried this service called Claimyr (https://claimyr.com) that got me connected to an actual IRS agent in under 15 minutes when I'd been trying on my own for days. You can see how it works here: https://youtu.be/_kiP6q8DX5c I was honestly skeptical at first but was desperate. The IRS agent helped me set up a payment plan on the spot and even waived some penalties because it was my first time having an issue. Saved me a bunch of money in the long run. From what the agent told me, it's WAY worse to not file than to file and set up a payment plan. The penalties for not filing are much higher.

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Emma Wilson

•8M

It uses some kind of call technology that navigates the IRS phone tree and holds your place in line. When they finally get through, they call you and connect you directly to the IRS agent. It's not a separate person - you're literally talking to the same IRS representatives anyone else would get, just without the hours of waiting and repeated hang-ups. They don't handle any of your personal tax information at all. They just get you past the phone system nightmare, and then you handle everything directly with the actual IRS agent. I completely understand the skepticism - I felt the same way until I tried it and was talking to a real IRS employee who verified everything.

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Isabella Oliveira

•8M

I need to eat my words from my previous comment. After waiting on hold with the IRS for 3+ hours and getting disconnected TWICE, I broke down and tried Claimyr out of desperation. Within 20 minutes I was talking to an actual IRS agent (I verified by calling the main IRS number afterward to confirm it was legit). The agent helped me set up a payment plan for the $2,200 I owe from a 1099 job I had last year. I was about to just not file because I couldn't afford to pay it all at once, but the agent explained that would've been a terrible idea with huge penalties. The payment plan is only $100/month which I can actually manage. For anyone in a similar situation - definitely file your taxes even if you can't pay, and don't waste days trying to call the IRS yourself. Lesson learned.

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Ravi Kapoor

•8M

Former tax preparer here. Just to reinforce what others have said - skipping filing is NEVER a good idea if you're required to file. The penalties are severe and compound quickly. Here's what you should know: if you make above certain thresholds, you must file regardless of whether you owe money or not. For 2024 (filing in 2025), a married couple filing jointly must file if their gross income is $27,700 or more. Different thresholds apply to different filing statuses. The IRS would much rather have you file and set up a payment plan than not file at all. They're actually pretty reasonable to work with if you're proactive and honest.

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Ravi Kapoor

•8M

You might be able to request penalty abatement, especially if this is your first time having an issue with taxes. The IRS has what's called "First Time Penalty Abatement" which can waive penalties if you haven't had any significant penalties in the past three tax years and have filed all required returns and paid (or arranged to pay) any tax due. For the employer error specifically, that's unfortunately common and usually doesn't qualify for special treatment on its own since ultimately it's the taxpayer's responsibility to verify proper withholding. However, you could request a letter from HR acknowledging their mistake, which might help support your case for penalty abatement. I'd recommend filing on time, setting up a payment plan, and then separately requesting the penalty abatement afterward.

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