Hill was charged this month with three counts of failing to file tax returns on more than $1.5 million earned from 2005 to 2007.
Hill appeared in U.S. District Court in Newark on Friday and admitted not filing taxes for all three years. She faces a maximum one-year sentence on each count.
The 37-year-old South Orange resident got her start with The Fugees and began her solo career in 1998 with the critically acclaimed album "The Miseducation of Lauryn Hill."
She then largely disappeared from public view to raise her six children, five of whom she had with Rohan Marley, the son of famed reggae singer Bob Marley.