What Actually Happens When a Person Doesn't Pay Their Federal Taxes?

We’re only a few weeks away from April 15, the last day to file and pay your federal and state income taxes.

While millions have already taken care of their taxes, some people have shared online that they are considering not paying their federal taxes as a form of protest against the federal government.

Earlier this month, Chicago lawyer Rachel Cohen went viral on social media when she announced her intention not to pay over $8,800 in income taxes. She told The Guardian that she refused to pay taxes that could fund aggressive immigration enforcement tactics or military actions in the Middle East.

Refusing to pay taxes has existed as a form of protest in the United States for centuries. During the Vietnam War, musician Joan Baez withheld 60% of her income tax from the Internal Revenue Service to protest U.S. military spending.

In the decades since, voices on both the left and the right have called for a “tax strike” as a response to U.S. intervention abroad. Last year, former Republican Rep. Marjorie Taylor Greene endorsed the idea of a “tax revolt” on social media, with the term “tax strike” seeing its biggest spike ever in Google searches in the days that followed.

However, tax professionals and legal experts consistently warn that refusing to file or pay taxes carries significant consequences. Under federal law, individuals who fail to meet their obligations may end up having to pay a lot more than what they originally owed — and in more serious cases, face enforcement actions by the IRS.

Keep reading for what to know.

What U.S. law says I need to pay taxes?

After the U.S. became an independent nation, the federal government financed itself mostly by charging tariffs on imported goods. By the end of the 19th century, elected officials from across the political spectrum were calling for some sort of income tax in order to finance a growing federal government and respond to the massive inequality of the Gilded Age.

But it wasn’t until 1913 that the country ratified the Sixteenth Amendment to the Constitution, which states that Congress “shall have power to lay and collect taxes on incomes, from whatever source derived.”

Since then, Congress has approved multiple laws that regulate how individuals should file and pay income taxes. All of these rules make up the Internal Revenue Code, which regulates how the IRS can go about doing its job. The Code also establishes clear limits for the agency, like limiting how it uses taxpayers’ personal information.

“We do not have a voluntary tax system,” said Amy Spivey, professor and director of the Low-Income Taxpayer Clinic at UC Law in San Francisco. “Anyone who earns or receives income in the United States has to file and pay taxes — that includes people who are undocumented as well.”

If I refuse to pay my taxes, what happens first?

Let’s say April 15 comes and goes, and you didn’t file anything with the IRS documenting your income from the previous year (and didn’t request an extension either). Will Uncle Sam be at your door on April 16?

Not exactly, Spivey said, but nonetheless, a clock at the IRS offices will begin to tick.

For each month that passes, the IRS can charge you two kinds of fees — a failure to file penalty and a separate failure to pay penalty — which are calculated as a percentage of the total amount you owe them. Meaning: The longer you don’t deal with your taxes, the bigger the amount the IRS will be expecting.

“Regardless of how much you owe, that’s going to add up,” said Minnie Sage, program director of San Francisco-based Tax-Aid.

You may start receiving letters from the IRS letting you know that your liability is growing. If you ignore this communication and let more time pass by, both penalties will keep stacking up on each other.

However, there is a point when the IRS can actually file a return for you based on your income information from years past — called a substitute return.

One downside of the IRS filing for you: Regardless of your living situation, the agency can actually file you as single and only give you a standard deduction, Spivey said. “You don’t get the benefit of any deductions, and it ultimately results in a higher tax burden,” she said.

As for when this might happen, Spivey said that in her experience, the IRS filing a return for you doesn’t happen immediately and could even take place a few years down the road. But in the meantime, both the failure to file and failure to pay penalties will keep accumulating.

Uncle Sam gets serious

Eventually, the IRS will kickstart a collection process to get what you owe. Here, the agency has two powerful tools available, Spivey said: a lien and a levy.

A lien is a document that establishes a legal claim by the federal government against your property or financial assets when you fail to pay a tax debt. “If you sell assets — for example, a home — you would have to hand over the proceeds or pay the taxes that you owe,” Spivey said.

A levy, on the other hand, allows the federal government to seize your property or financial assets to cover what you owe the IRS. Once you get a notice of intent to levy, you usually have 30 days to enter some sort of payment arrangement with the IRS.

This agreement could potentially include an “offer in compromise” if you’re unable to pay your full tax liability or doing so “creates a financial hardship,” according to the agency. This may potentially reduce your tax debt — but relies on the IRS agreeing with your assessment of your finances.

But if you ignore this notice, the IRS will go ahead and levy your property anyway. This could look like taking what you owe directly from your bank account, since your bank is required by law to comply with a levy,  and if you don’t have enough money in your account, you’ll also be liable for overdraft fees from your bank.

In certain cases, the IRS can garnish your wages, meaning the agency communicates with your employer to require that a certain percentage of your salary be used to cover your debt.

Spivey said that the IRS — depending on how much you owe — can also levy your retirement account. In extreme circumstances, they can even take your home or revoke your passport or block you from applying for one.

Collection proceedings usually go through civil law, but in very specific cases, the federal government can also enforce tax law through criminal prosecutions — which could result in much more severe penalties, including prison time.

But even if someone’s situation does not get to that level, experts point out that not filing can complicate other parts of life. “A tax return is oftentimes a requirement for proof of income, with things like housing, education and federal loans like FAFSA,” Sage said.

If you also skipped on your state taxes, California’s Franchise Tax Board also has similar powers. “The Franchise Tax Board can also file a lien, they can levy your accounts, they can garnish your wages,” Spivey said. “You could potentially be looking at both the IRS and FTB both coming to collect the taxes that you owe.”

What do those refusing to pay taxes say?

Advocates of a tax strike say that international conflicts involving the U.S. — most recently, the ongoing war with Iran — are boosting public interest in what they call “tax resistance” as a form of political protest.

Lincoln Rice, coordinator for the Milwaukee-based National War Tax Resistance Coordinating Committee, told KQED that before Israel’s invasion of Gaza in 2023, around 20 people would attend his group’s online trainings.

But hundreds of people are now showing up, he said. Training sessions cover “legal and illegal methods of war tax resistance along with the associated risks,” he said, adding that the group organizes a fund that aims to help members cover penalties and interests collected by the IRS.

Rice said his group has also “offered W-4 workshops, where we explain how employees can lower or eliminate the federal tax withholding done by their employer.”

But tax experts are quick to point out that even if you have zero federal tax withholdings on your paycheck, the law still requires you to pay taxes on those earnings down the line.

“We are on a ‘pay-as-you-go’ tax system, which means that taxpayers are required to pay taxes throughout the year on your income,” Spivey said. “If you underpay throughout the year, you may be hit with an Underpayment of Estimated Tax penalty, in addition to any tax you may owe related to the under-withholding.”