California taxpayers beware! Willfully failing to file tax returns for three or more consecutive years is sufficient to determine the taxpayer intended to evade paying tax, and therefore may be prosecuted for felony tax evasion and punished by imprisonment not to exceed one year. Under federal law, an element of willfulness is required – that is, some other affirmative act such as hiding assets offshore, keeping a second set of books, or destroying records. According to California’s 4th District Court of Appeal, the mere failure to file tax returns is sufficient under California Revenue and Taxation Code section 19706. We agree with the dissent and hope this case proceeds to the California Supreme Court.

For the full opinion cited here from Hudson v. The People, click here [PDF].