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In 2010 - 2011 I did freelance web development as my only source if income. All the money I received was under the table and I didn't pay taxes. I did, however, pay taxes for 2012

I want to work for an actual company (freelancing isn't really my thing) so I'm putting my resume together. A friend advised me to not say that I worked during 2010-2011 because since I didn't pay taxes, when employers do a background check they will see that and assume I was unemployed.

Is this true? Can employers see whether or not I paid taxes certain years in a background check? This all occurred in the United States.

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    Did you not pay taxes, or did you not file a tax return? There's a big difference. Either way, don't lie on a resume, ever. What comes out of a background check will vary by employer, not everyone runs the exact same checks. – alroc Jun 20 '13 at 12:52
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    If you go to jail for tax evasion it will be difficult to hide. – IDrinkandIKnowThings Jun 20 '13 at 13:01
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    Your question is basically asking for advice for avoiding detection of a criminal act. While I am not judging the morality of the act, I do not think that it is appropriate for this site. – IDrinkandIKnowThings Jun 20 '13 at 15:01
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    If you're in the US and didn't even file a tax return, you may (depending on other conditions) have bigger things to worry about than a gap in your employment history. Being paid for employment and not paying taxes for it is a bigger deal than you seem to realize. – alroc Jun 21 '13 at 11:17
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    For the sake of argument, let's say that once I am employed I will be more than willing to go back, file taxes for previous years (including all penalties associated with filing late). From a "getting hired" perspective, would I be alright putting that I worked on my resume even though I didn't file taxes? – Alexander Jun 21 '13 at 11:47
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Can employers see whether or not I paid taxes certain years in a background check?

The answer is, it depends.

  • Average employer, probably not. Their background check will not be that thorough.
  • One that requires a more extensive background check, it is more likely that they will. If you are applying for a position that requires a financial check they could ask for tax forms.
  • One that requires a government clearance, they will probably discover it.

Keep in mind that if you owe taxes, and you can't pay them, then the IRS or the state taxing authority, could garnish your wages. That would be a big clue that there is an issue.

If they would be concerned about non-payment: you are applying to be an accountant, then lying on the forms could get you fired.

Note most government tax agencies look for missing years. It could be a matter of time before they ask about the missing forms.

Edit:

From a "getting hired" perspective, would I be alright putting that I worked on my resume even though I didn't file taxes?

Your resume lists your experience related to work, it is not a comment on your financial condition. Keeping in mind that your lack of filing and paying taxes may hurt your chances for some jobs, it is not relevant for other jobs.

The sooner you file the required tax paperwork, the sooner the issue can be resolved. And the sooner interest and penalties will stop accumulating. You need to get expert help.

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If you are attempting to get any kind of security clearance or role with a fiduciary responsibility, this could become an issue. However, in general the IRS treats their relationship with taxpayers as confidential. Therefore, the person or organization running the check would have to assert that they 'needed to know', and would face their own penalties for answering falsely.

The IRS has complained since the 1970s about the number of IT contractors that have skipped out on taxes. Employers that know such things might find you're just another grain of sand in the pile.

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