Your question is quite confusing. First, the sister-in-law cannot take your friend to jail. Prosecution of a legal matter can only be done by the state or Federal government. I suggest you contact a tax attorney in your area to go over your friends situation. The attorney will be able to contact the IRS on behalf of your friend and help her better understand the situation.
Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, any tax advice contained in this communication, including attachments thereto, was not written to be used and cannot be used for the purpose of (a) avoiding tax-related penalties under the Internal Revenue Code or (b) promoting, marketing or recommending to another party any tax-related matters addressed herein. If you would like a written opinion upon which you can rely for the purpose of avoiding penalties, please contact Steven F. Schroeder using the contact information set forth above.