Q&A: How many different IRS debt penalties are there?

4 Responses to “Q&A: How many different IRS debt penalties are there?”

1. Laura says:

   July 3, 2011 at 7:52 am

   There are many penalties you could be getting. If you failed to file then you were hit with a penalty of 5% of the original debt per month for a maximum penalty up to 25%. If you have failure to pay taxes penalty (which is the most common) then that penalty is charging .05% of the original debt per month up to the above maximum of 25%. The other two penalties deal with underpayment or intentional disregard and tax fraud.

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2. Bobbie says:

   July 3, 2011 at 8:41 am

   Filing Late and/or Paying Late

   http://www.irs.gov/businesses/small/article/0,,id=108326,00.html

   Topic 653 IRS Notices and Bills, Penalties and Interest Charges

   http://www.irs.gov/taxtopics/tc653.html

   Generally, interest is charged on any unpaid tax from the due date of the return until the date of payment. The interest rate is determined quarterly and is the federal short-term rate plus 3 percent. Interest is compounded daily. If you file on time but don’t pay all amounts due on time, you’ll generally have to pay a late payment penalty of one-half of one percent of the tax owed for each month, or part of a month, that the tax remains unpaid from the due date, until the tax is paid in full or the 25% maximum penalty is reached. The one-half of one percent rate increases to one percent if the tax remains unpaid 10 days after the IRS issues a notice of intent to levy. For individuals who file by the return due date, the one-half of one percent rate decreases to one-quarter of one percent for any month in which an installment agreement is in effect.
   If you owe tax and don’t file on time, the total late-filing penalty is usually five percent of the tax owed for each month, or part of a month that your return is late, up to five months. If your return is over 60 days late, the minimum penalty for late filing is the smaller of $ 100 ($ 135 for returns required to be filed after December 31, 2008) or 100 percent of the tax owed.
   You must file your return and pay your tax by the due date to avoid interest and penalty charges. Often the funds necessary to pay your tax can be borrowed at a lower effective rate than the combined IRS interest and penalty rate.
   Hope that you find the above enclosed information useful. 06/23/2011

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3. mercedes says:

   July 3, 2011 at 9:40 am

   Most people are limited to three or four

   Late filing of return
   Late payment of the tax due
   Failure to mak estimated tax payments.

   If you are audited, you may be assesssed a negligence penalty.

   There are numerous others but you are unlikely to encounter them.

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4. Karie Iversen says:

   July 3, 2011 at 9:40 am

   tax liens

   http://taxsalessecrets.com/

   Reply

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