<prompt> Human: Alright, Im just starting to work but thanks to this sub Im getting a pretty good idea of how money works, but one thing caught me off guard. Now I may be completely wrong on the concept of how taxes work, so just tell me if I am. In April you do your taxes, which means you make sure you are paying the correct amount of money that the government took from your paycheck. But is that process necessary? Lets just say for explanation purposes the government took 1000 in taxes out of my paycheck. Now thats just an estimate. If I actually owed 800 and didnt do my taxes, the government would keep the 200. If I owed 1200, the government would contact me about it and make sure I did. Now I would be losing 200, but would that cost allow me to get out of the stress of tax season? Or would I have to pay fines?Please forgive my terrible understanding of our financial system  <response>: Your thinking is correct in a sense. The IRS says you have to file your taxes if you make a certain amount generally, the standard deduction plus a personal exemption, or 10,350 for 2016, because over that amount, taxes are due.Of course, if youre an employee, you have taxes withheld. If you are due a refund, the IRS will not come after you to file a return. They will say nothing, and 3 years after the due date for the return, you lose the right to get your refund.Of course, if its the other way around, the IRS will contact you, no statute of limitations, and youll likely owe penalties interest. 