Tax fraud comes in a variety of forms, from simply not paying taxes, under-reporting income, complicated tax evasion schemes and flat out refusal to pay taxes. Many people underestimate the severity of the penalties associated with tax fraud crimes. The IRS investigates and prosecutes tax crimes vigorously, and the penalties for these crimes are not limited to criminal penalties like prison time, but also civil penalties which can be steep in the form of interest penalties, late payment penalties, wage garnishments and more.

In 2009, the average tax fraud conviction resulted in 27 months of jail or prison time served.