Tax Penalties
Overview
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Late filing: 4-1/2 % per month; 22-1/2% max
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Late paying: 1/2% per month; 25% max. (combined with late filing 1st 5 mo.)
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Late filing minimum: smaller of $450 for returns required to be filed in 2023
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Failure to report tips: 50% of the SS tax on tips
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Dishonored payment:
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Less than $1,250 – lesser of $25 or the amount of the check
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$1,250 or more – 2% of the check amount
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Excessive Claim Penalty: 20% of the excessive amount
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Fraud: 75% of the unpaid tax due to fraud
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Negligence (accuracy related): 20% of the underpayment, 40% if attributable to undisclosed foreign financial asset
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Paying late:
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Each month – ½%
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After notice to levy – 1% per month
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Maximum 25%
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If paying in installments – ¼% per month
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Missing ID Number: $60 each due in 2024.
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Late filing because of fraud: 15% per month
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Maximum 75%
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Failure to report foreign gifts: 25%
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Failure to report ownership of or transactions with foreign trusts: Greater of $10,000 or 35%
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Failure to report foreign assets (Form 8938): $10,000 for 1st 90 days and $10,000 for each subsequent 30 days
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Failure to report Foreign Accounts (FBAR): $10,000 (non-willful), $100,000 or 50% of account balance if willful – amounts are subject to inflation-adjustment
Related IRS Publications and Forms
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Form 1040 Instructions
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Pub 17 - Your Federal Income Tax
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Form 4868 Instructions – Application for Auto Extension
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Notice 746–Info About Your Notice, Penalty and Interest