What exactly happens if you are unemployed and don't pay taxes?

[SpasticGramps]

Hold on, Hold on. Lemme bust this out.

Love this thing! Thanks sac beh!

Don't worry you can always rely on Social Security.....

Wait a minute, wait a minute, hold on....... lemme go look in the Social Security confers....

Oh shit......

Looks there is nothing in here either. Someone had sticky fingers and blew the all the money on wars and golden toilets instead of saving it like they should have. Hopefully China will keep ponying up and buying our debt.

To the topic... If have no income you don't pay income taxes. Unemployment benefits are considered income. You do, also, get the privilege of paying consumption taxes on everything else too.

 

[phrike]

Someone should email the IRS and say "i rob liquor stores to make money, is this to be treated as income?" The reply would have us in stitches!

AFAIK, all illegal activity income is taxable, just as legal income.

Income tax evasion is how they finally got Al Capone.

My perspective is Canadian, but I think this applies in the US too. Don't Americans have to report Las Vegas winnings as taxable ?

Here in Canada at least, filing income tax papers is not strictly required. HOWEVER, Revenue Canada (our "IRS") can send a demand to file and then you must file. I didn't file for 8 years (But tax was withheld at source) and they didn't start asking for returns until I paid them $10k one year (self employed) and they must have scratched their heads at that, LOL.

Not filing is not the same as "tax evasion".

Yes, more and more it seems we are being coerced to file papers. They do this by offering rebates or some give-backs (like Canadian GST credit), particularly for lower income people.

IMO, if you are making a reasonably substantial living from illegal means (like growing pot), and little or no legal income, then it's best NOT to file taxes. Once you've filed them, claiming 0 income is a tax lie, ie evasion.


I understand it is becoming more common for the gov't to estimate your income over the years and tax you retroactively based on that, when you are convicted of a money making offense. Add interest and penalties, and in many cases bankruptcy will not shield you from gov't tax debt.

Although we outright own our own home and cars, I really like the idea behind the book of the title "Die Broke". (heck, "live broke".) Seems right to leave parasitic corporations and governments nothing when we go. Geeze, in effect there are various death taxes these days; where will it end ?

 

[InvisibleEmpire]

Here's a good question.

Let's just say, theoretically, that someone in their 20s had a job for 5 years, paid taxes like everyone else, but after a falling out lost his job and hasn't had a job in years. Let's say that his bills are paid by various family members, and he has absolutely no income.

Filing 0 income on your taxes would not be tax evasion, by definition....you have no income, yet your bills are paid by others.

I'm extremely fed up with corporate America, working 40, 50, 60 hour weeks just to get by. I'm surviving on my 401k I withdrew. I'm fed up with our tax money going to fight endless wars and line the pockets of the elite. Fuck it, I'm growing for a living soon.

On that note, as long as I don't start attempting to put things in my name (homes, vehicles, etc.) I don't see the IRS giving me any hassles as long as I file a return and cite 0 income. My question pertains to state, city and school taxes when you have 0 income...guess I'll have to call the city...

 

[TwoOhSix!]

I haven't filed for 4 years, haven't heard a peep.

Income tax is illegal, the IRS is an organized crime ring.

 

[Baba Ku]

If someone has been providing your subsistence (at least 51%), then they will be claiming you on their returns. No need for you to file when you are being claimed as a dependent. The IRS will question you making zero and living off others, when the others don't claim you. Sort of disagrees with what you are telling the auditor. Anyone truly providing your subsistence will be claiming that deduction. It is one of the reasons they ask for your kids SS# on the return.

And unless you were able to draw out your 401 money without being taxed, you will not only have to pay tax on that money, but I think it takes extra penalties for early withdraw.
You may have already seen the consequences of dipping into a savings like that.
And if you happen to be audited, and trust me a 0 income return is going to set off flags, they may check your return against those who are claiming you.
If you don't have anyone claiming you, best to not have a bank account, because the auditor can see what is in it and when it was put there. You would have to answer for any money that goes in or out.
If the only issue is that you have been living off your 401K, then there will be a trail and as long as you paid the tax when you withdrew it, you would be good with that and you only have to pay on it once.

 

[InvisibleEmpire]

If someone has been providing your subsistence (at least 51%), then they will be claiming you on their returns. No need for you to file when you are being claimed as a dependent. The IRS will question you making zero and living off others, when the others don't claim you. Sort of disagrees with what you are telling the auditor. Anyone truly providing your subsistence will be claiming that deduction. It is one of the reasons they ask for your kids SS# on the return.

And unless you were able to draw out your 401 money without being taxed, you will not only have to pay tax on that money, but I think it takes extra penalties for early withdraw.
You may have already seen the consequences of dipping into a savings like that.
And if you happen to be audited, and trust me a 0 income return is going to set off flags, they may check your return against those who are claiming you.
If you don't have anyone claiming you, best to not have a bank account, because the auditor can see what is in it and when it was put there. You would have to answer for any money that goes in or out.
If the only issue is that you have been living off your 401K, then there will be a trail and as long as you paid the tax when you withdrew it, you would be good with that and you only have to pay on it once.

Nobody is paying for me, and nobody claims me as a dependant...i just used that as an example. I am currently surviving on 401k funds and yes, they immediately tax your base 401k a 20%, and you then (i was told) at tax time, pay an additional 10% on the principle. Which REALLY sucks, as I'm almost broke and tax season is making it's way here...

Thank GOD my new 2,400w setup starts up next month!!!

 

[HempKat]

A small town in Sweden of 80,000 citizens recieved more iraqi refugees after the war than the WHOLE U.S (and canada combinded), unemployment is sky high, guess who's paying that -_- fuck sometimes i just hate america soo much.. the government

and about the real topic, I dont think they can force you to pay taxes if you dont have a legit income, they expect you to rob a liquor store every now and then to pay them? lol

Actually they expect you to liquidate any assests you have to pay the taxes.

 

[HempKat]

All these guesses aren't going to do you much good. You need to visit www dot irs dot gov. Unlike in the past, these days the site is a lot more user-friendly and the average person is much more likely to find an answer you can understand.

One thing I recall from the site re unemployment is: they can't put a lien on your bank account to collect unpaid taxes as long as your only income is from unemployment compensation.

Of course, now that I'm typing that, that sounds really naive... as in, "that's how it's supposed to work", and as a bureaucratic machine, they could easily attach your bank acct anyway, "oops!", and it would be on you to find (and pay for) a way to fight it in court. So proceed with caution!

IRS's site doesn't answer questions about local government taxes (cities, counties, state). As for Federal tax it is no guess that IRS will tax you on your unemployment. The only option you get is to not have it taken out of your check, but come April 15th you better have it included as part of your taxible income if you don't want to be audited.

 

[HempKat]

Seems right to leave parasitic corporations and governments nothing when we go. Geeze, in effect there are various death taxes these days; where will it end ?

It won't end there, the new corporate trend is to take out massive life insurance policies on employees so that it becomes profitable to the corporations when you die.



http://en.wikipedia.org/wiki/Corporate-owned_life_insurance

 

[HempKat]

Here's a good question.

Let's just say, theoretically, that someone in their 20s had a job for 5 years, paid taxes like everyone else, but after a falling out lost his job and hasn't had a job in years. Let's say that his bills are paid by various family members, and he has absolutely no income.

Filing 0 income on your taxes would not be tax evasion, by definition....you have no income, yet your bills are paid by others.

I'm extremely fed up with corporate America, working 40, 50, 60 hour weeks just to get by. I'm surviving on my 401k I withdrew. I'm fed up with our tax money going to fight endless wars and line the pockets of the elite. Fuck it, I'm growing for a living soon.

On that note, as long as I don't start attempting to put things in my name (homes, vehicles, etc.) I don't see the IRS giving me any hassles as long as I file a return and cite 0 income. My question pertains to state, city and school taxes when you have 0 income...guess I'll have to call the city...

That's your best bet as it varies region to region, I live in a state near you and if you don't have an income or a home you don't pay taxes.

 

[TNTBudSticker]

You still File taxes even if you Didn't make anything any year.

Just put $0

You made nothing.That's all THEY need to know.

I bet when you got the Stimulus check.When you cashed the check,The government knows you out there and now want all the years you didn't file taxes.

Haste make Waste.Do Your Taxes.I did.

 

[Marco61]

You don't need to file federal, but i would file your state and local. You'll end up paying something like $2-4 dollars in taxes. lol, sure you can manage that. Just file it like you normally would and just put in zero wherever they need a number. however, if you have collected interest from a bank account that will need to be filed too. Usually where the $2-4 dollars worth of tax comes from.

 

[ibjamming]

It won't end there, the new corporate trend is to take out massive life insurance policies on employees so that it becomes profitable to the corporations when you die.



http://en.wikipedia.org/wiki/Corporate-owned_life_insurance

Isn't that fucked up? I'd heard of it too...

You know what's worse? Having the government support you...giving you money every month to live on...and at the SAME TIME, they're paying for your "health care". Isn't that a conflict of interest? The fox guarding the chicken house? Isn't there an INCENTIVE to not take very good care of you?

It's a messed up world...

 

[SpasticGramps]

It won't end there, the new corporate trend is to take out massive life insurance policies on employees so that it becomes profitable to the corporations when you die.



http://en.wikipedia.org/wiki/Corporate-owned_life_insurance

I saw that on one of the "news" channels. I think it was Wal-Mart they were talking about. Totally perverse.

 

[Guest 150314]

I haven't filed for 4 years, haven't heard a peep.

Income tax is illegal, the IRS is an organized crime ring.

Could not agree more, I stopped filing taxes when I stopped having a legal income. Haven't heard anything and it's been years.

 

[CaptainTrips]

Could not agree more, I stopped filing taxes when I stopped having a legal income. Haven't heard anything and it's been years.

I haven't filed either probably longer than 4 years, never heard anything... of coarse you never know when that could change, seems it would be risky filing after years of no filing even if you still have no legal, or any income.

 

[OMountainMix]

Unemployment isn't taxed for the first $3500 per year. Then it's taxed.

 

[U4ic]

Isn't there an earned income credit you can get and actually get money back if ya file?

 

[InvisibleEmpire]

I'm fighting the court now to reverse a decision from unemployment...

I do know they tax it regardless...not sure what the specifics are but when i filed dude told me taxes can be taken out automatically or you just pay it at the end of the year.

I just plan on taking care of 2010 taxes fed/city/state then afterwards begin filing with 0 income. I doubt I'll encounter any problems because I'm not dumb enough to start buying cars and houses while stating 0 income...that's what giving the cash to a rich relative is for, having them buy the car then a month or two later sell it to you for $1

 

[OrganicOzarks]

I have friends that have not filed in 15 plus years. Nothing ever happended. Although one friend had not filed in 9 years, and his brother ended up turning in a 1099 on him for over 100k. they asked what he had been doing those other years, and he said he was strung out. They dropped it. If you do file a tax return and make enough for earned income credit, and some other things then you can get a return with having to actually "pay out" taxes. There is money just sitting there waitng for someone. Might as well be you.