At first glance, it might seem that the inability to pay taxes is something only people of limited means might encounter; having too little withheld in taxes on one’s paycheck could lead to a big tax bill in the spring, and someone with a limited income stream might have a tough time coming up with a large sum of money to deliver to the Internal Revenue Service or state taxation authorities.
However, in reality, people of all income levels might be susceptible to having unmanageable amounts of tax debt. One example of this is actor Stephen Baldwin, of the famous Baldwin acting brothers. Stephen Baldwin pleaded guilty earlier this year to failing to pay New York state taxes for three years; between the amount he owed, plus interest and penalties, the state was due a staggering $400,000 from Baldwin.
However, that amount has now decreased by roughly half. Baldwin’s attorney announced recently that $100,000 would go toward the tax debt; this is in addition to another $100,000 that Baldwin put toward the debt earlier this year. When he agreed to plead guilty to not paying taxes earlier this year, the actor agreed that the full amount would be repaid by March 2014. If he does that, he won’t have a criminal record. Should he not live up to the bargain, however, he could be on the hook for five years’ probation.
Baldwin’s unpaid taxes stretched over a three-year period; however, people who know they are going to owe the government unpaid taxes might wish to consult with an experienced New York tax attorney before it gets to the point that it did in this case.