Nate Harper has long had trouble paying his taxes, an issue that came up when he was named Pittsburgh's police chief. This time, that mistake may have actually worked to his benefit.

Mr. Harper, 60, was indicted Friday on one count of conspiracy, related to the diversion of funds into an off-the-books account that he then tapped for $31,987 in personal expenses including restaurant meals, an XM radio, a 32-inch LCD television and more. Four other counts had him willfully failing to file federal tax returns in 2008, 2009, 2010 and 2011.

Failure to file is a crime, but it brings a lesser penalty than would submission of a fraudulent tax filing. It's also easier to explain a forgotten return -- or four -- than a falsified one.

"The chief's explanation has to do with some personal issues and procrastination," said Robert Del Greco, one of two lawyers representing Mr. Harper. Losses of family members and the April 4, 2009, fatal shooting of three city police officers were among the distractions that kept him from filing returns, Mr. Del Greco said.

He called the failure to file "indefensible," but noted that taxes were withheld from Mr. Harper's city paycheck. "The amount [of unpaid taxes] isn't a great amount."

Mr. Harper, Pittsburgh's police chief until his forced resignation Feb. 20, came into the office under something of a financial cloud.

When he was picked to be chief in late 2006, his property taxes to the city and county were overdue. Records on file with Allegheny County showed that his Stanton Heights home was regularly subject to liens for delinquent levies. A city spokesman said then that it wasn't an issue, but media, including the Pittsburgh Post-Gazette, reported the payment problems.

From 1996 through 2007, Allegheny County filed 10 delinquent tax actions against Mr. Harper for unpaid property taxes. The city of Pittsburgh filed another three -- two for unpaid property taxes, and one for a delinquent sewer bill. The 13 actions reflected $6,488 in unpaid taxes, which Mr. Harper usually covered within a short time of the filings, but occasionally let fester for as long as five years.

There is no indication that Mr. Harper continued to ignore local levies after 2007. Instead, he stopped filing 1040s, which is a misdemeanor, his lawyers explained.

"He willfully chose not to file his income tax returns for four years," said IRS Special Agent in Charge Akeia Conner, noting that his income was about $475,000 over that span.

"No public official gets a free pass to ignore the tax law," she said.

Failure to file, however, isn't legally as bad as fraudulently filing. That's especially true in cases like Mr. Harper's, when the bulk of the defendant's income came through a paycheck from which taxes were withheld.

Federal sentences for filing fraudulent returns are based on the difference between the actual income and the reported income.

But sentences for failure to file are based on the amount that the defendant owed, but didn't pay. That's typically a fifth to a quarter of the amount of income that wasn't subject to withholding.

"Maybe he [failed to file] as a mechanism," said James Fellin, a forensic accountant at a Downtown-based firm, The Nottingham Group. "I can't be prosecuted for filing a false tax return if I don't file it."

Mr. Harper's attorneys said that federal sentencing guidelines suggest 10 to 16 months in prison, given the crimes and the amounts of money involved. They plan to seek a sentence of house arrest.

There was no hint in public records, prior to Friday, that Mr. Harper was not filing tax returns. Though the IRS can file public liens on a person's house or bank account for unpaid taxes, it has never done that to Mr. Harper.

There may be reasons the IRS didn't seek to slap a lien on Mr. Harper's property, even for unpaid taxes from as early as 2008.

When an employer sends a W-2, but the employee doesn't file a return, it usually takes the IRS around a year to take action, said Joe Nicola, a tax partner at Sisterson & Co. It then sends notices and tries to meet with the taxpayer.

"The service will hold off, certainly, examining a return or following up on a non-filer if a taxpayer is making an effort to file a return," Mr. Nicola said. The IRS may take other steps, like obtaining bank records and filing a return for the taxpayer, based on assumptions favorable to the government, and then demanding payment for any taxes due.

"The wheels of the IRS and the federal government sometimes move slowly," Mr. Fellin said. "A lot of times it takes them years to catch up with somebody who hasn't filed a return."

Mr. Nicola said it generally takes 2 to 21/2 years of taxpayer noncompliance for the IRS to file a lien.

Though there is a time lag, the IRS's computers will inevitably identify a non-filer, and agents will eventually get tough, he said. "Simply not filing a return is a bad idea."

First Published: March 23, 2013, 4:00 a.m.