I failed to file a NC tax return for 2007. The statue says I earned $19,000+ and received unemployment benefits of $4,000+, and paid no taxes, resulting in my owing $1,200 in taxes and $1,000+ in penalties. Although I didn't file, I paid more than $400 in income taxes. I can file, and probably lower my tax liability to two or three hundred dollars, that still leaves the penalty issue. If the state cannot touch my social security, I don't care.
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