Taxes aren’t exactly anyone’s favorite topic, but ignoring taxes can land you in some serious trouble.
While most people who miss a payment or two won’t see the inside of a jail cell, there are cases where tax mistakes — or outright fraud — lead to real prison time. Some of the most well-known figures in history, from celebrities to crime bosses, have learned this the hard way.
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So, what does it actually take to get locked up over taxes? And more importantly, what lessons can you take from their mistakes to make sure you never end up in the same situation? Let’s look at five notable cases where people went to jail for taxes — and what you should keep in mind when it’s time to file yours.
In general, people who can’t pay their taxes don’t go to jail. In fact, many people in the United States are not even required to pay taxes. This exception typically applies to people living below the poverty level. So, no, it’s not illegal to not pay taxes if you don’t owe them. And if you work with an accountant, you’ll likely find ways to save money when you file.
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When you will get in trouble with the Internal Revenue Service (IRS) is when you can or should pay and you lie on your tax return or don’t pay taxes when you should. These instances are called tax fraud and tax evasion.
Still, even if you do engage in this illegal activity, it’s unlikely you’ll go to jail over a few thousand dollars.
But let’s look at some of the most notable cases of people who did see the inside of a jail cell over taxes.
The biggest example in U.S. history of tax evasion is organized crime boss Al Capone. In 1931, Capone was charged with failing to pay $215,000 on an income of $1,038,654, as covered by the History Channel. That’s the equivalent of a tax evasion of $4 million today.
This case has remained in the public mind because tax evasion was the only way the federal government could finally get Capone in jail.
Perhaps the next most famous case of tax evasion is 90s action star Wesley Snipes. In modern times, it was the first time many people heard of someone going to jail for taxes. Snipes was initially charged with felony tax fraud, but his sentence was reduced to tax evasion for failing to file taxes for the years 1999, 2000, 2001.
He served three years in prison, the maximum time permissible for this misdemeanor crime. Even after serving his time, Snipes spent years in court battling with the IRS over the department’s claims he owed $9.5 million in taxes, which he ended up having to pay, according to Reuters.
Another infamous tax evasion case is that of hip hop singer Lauryn Hill. The star was at the height of her career, had just won a Grammy and was charged for failing to file her tax returns for the years 2005, 2006 and 2007. The department claims she failed to report $1.8 million in income, according to BBC News.
Hill argued that she was unable to file taxes because she had retreated from public life and planned to care for her children. She ended up spending three months in a minimum security prison and paying $970,000 in taxes.
IRS commissioner Joseph Nunan Jr. spent five years in prison in 1952 for tax evasion. While history likes to remember that Nunan went to jail for failing to report $1,800 in winnings from a bet, the truth could actually be much darker.
After Nunan had left the department, the IRS investigated him and found he had been hiding more than $90,000 in income, according to Justia. It could be the price tag of the debt, but it is much more likely that Nunan worked for the department and should have known better. He had to be made an example of.
Hollywood Madam Heidi Fleiss had a case much like Al Capone’s. She was running a prostitution ring in Los Angeles to serve some of the world’s richest men. While she could have been charged with prostitution, the government found it much easier to bring other charges — tax evasion and money laundering.
Even though she was convicted on eight counts, she was not given even the minimum sentence of several years, serving just 37 months, as reported by the Los Angeles Times.
Interestingly, Willie Nelson, a famed country singer, did not go to jail despite being charged by the IRS for owing $32 million — certainly in a different tax bracket than most. Though, his assets were seized and his case is worth noting because many claim that Snipes and Hill were discriminated against and used as “examples.” Nelson’s ability to avoid jail may prove this point.
The singer not only didn’t pay owed taxes, but he also invested money in questionable tax shelters, which could be seen as tax fraud, a serious crime, according to the History Channel. In the end, Nelson settled with the IRS for $6.5 million in back taxes plus another $10 million in penalties and interest.
The lesson? Be careful when you file your tax returns. If you have a simple tax return, use a software service like H&R Block or TaxSlayer that will walk you through each section of the return. You can file electronically and either receive your return via direct deposit or arrange for monthly payments to pay what you owe.
If you have a more complicated return with a mortgage, a business, rental properties or any other write-offs, your best approach is to work with a specialist who can make sure you’re both not evading taxes and getting all the right deductions.
The bottom line is that you want to make sure you pay your fair share, but not a penny more.
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This article originally appeared on GOBankingRates.com: 5 People Who Went To Jail for Taxes and What You Can Learn From Them
