New York Governor David A. Paterson’s top aide recently made headlines for his failure to file and pay his taxes for 5 years, from 2001 to 2005.  While Charles J. O’Byrne has paid the $300,000 in back and federal taxes he owed, his lawyers said that the aide had problems with depression and suffered from failure to file syndrome, “a condition that made it difficult for him to fill out his tax returns.”

Late-filing syndrome, sometimes known as nonfiling syndrome or failure-to-file syndrome, is not listed in the Diagnostic and Statistical Manual of Mental Disorders. A spokeswoman for the American Psychiatric Association said that the group does not recognize it as a psychiatric condition.

But legal experts said that it is not uncommon for tax evaders to claim they suffer from such a syndrome, because it can shield them from criminal penalties.

The symptoms of  failure to file syndrome were outlined in the New York Times:

In an article titled ” ‘Failure to File’ Syndrome: Legal and Medical Perspectives,” published in the New York Law Journal in 1994, Eliott Silverman, a lawyer, and Dr. Stephen J. Coleman, a practicing psychiatrist, describe the traits shared by sufferers of the syndrome:

1. They are sophisticated, both financially and with respect to taxes.
2. The reality of ultimate discovery of the failure to file is obvious to them.
3. The potential penalties, both financial and professional, are clear to them.
4. They acknowledge that these penalties will likely occur.
5. There is often no clear benefit to not filing, in that either (a) there is no significant tax due, or (b) they have the money to cover their tax liability, or (c) they can easily borrow the money to cover the liability.
6. They usually have a history of filing in the past.
7. They sometimes get extensions and make some estimated payments.
8. They often are anxious and obsessed about not filing.
9. And yet, exhibiting self-destructive behavior like lemmings rushing to the sea, they do not file until the I.R.S. is upon them.

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Tags: Back Taxes, delinquent tax returns, failure to file, tax evasion, tax expert

This entry was posted on Thursday, October 23rd, 2008 at 1:29 pm and is filed under IRS Tax Cases, Unfiled Returns - Delinquent Tax Returns. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.