Late Filing

The rates will be:
Three percent for overpayments – two percent in the case of a corporation;
Three percent for underpayments ;
Five percent for large corporate underpayments; and
One-half percent for the portion of a corporate overpayment exceeding $10,000.
Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis. For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus three percentage points.

Interest is charged on any unpaid tax due from the due date of your tax return (usually April 15) until the date of payment. The interest rate is determined every 3 months. There are separate late filing and late paying penalties. If you file on time but do not pay on time, you will generally have to pay a penalty of one half of 1% of the unpaid tax due for each month or part of a month the tax remains unpaid. If you owe tax and don't file on time, the penalty for not filing on time will be separately calculated.

No penalty for late filing or late paying will be charged when a refund is due to you. The penalty for late filing and late penalty is based upon the unpaid taxes as of the due date of the return.

Interest, compounded daily, is charged on any unpaid tax from the due date of the return until the date of payment. That rate is determined every 3 months. For 2013 the interest rate is 3%. In addition, if you filed on time but did not pay on time, you will 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 after the due date, up to a maximum of 25%. The one half of one percent rate increases to one percent if the tax remains unpaid after several bills have been sent to you and the IRS issues a notice of intent to levy. If you owed tax and did not file on time, the penalty is even higher. The combined late filing and late payment penalty is 5% of the tax owed for each month, or part of a month, that your return was late, up to a maximum of 25%. If your return was over 60 days late, the minimum penalty is the smaller of $100 or 100 percent of the tax owed.

A tax return delivered to the IRS by U.S. mail after the due date is considered timely filed if the return was postmarked on or before the due date of the return. This rule includes postmarks supplied by any private delivery service designated by the Service. An income tax return postmarked April 15 and received by the IRS on April 19 is considered timely filed.

The IRS will waive penalties when allowed by law if you can show that you acted reasonably and in good faith or relied on the incorrect advice of an IRS employee. The IRS will also waive interest that is the result of certain errors or delays caused by an IRS employee.

The Internal Revenue Service announced that interest rates for the calendar quarter beginning January 1, 2011, will decrease by one percentage point. The rates will be: three (3) percent for overpayments [two (2) percent in the case of a corporation]; three (3) percent for underpayments; five (5) percent for large corporate underpayments; and zero and one-half (0.5) percent for the portion of a corporate overpayment exceeding $10,000. Interest rates for the calendar quarter beginning July 1, 2011, will remain the same as in the previous quarter April 2011-June 30th 2011. The rates will be: four (4) percent for overpayments [three (3) percent in the case of a corporation]; four (4) percent for underpayments; six (6) percent for large corporate underpayments; and one and one-half (1.5) percent for the portion of a corporate overpayment exceeding $10,000. Interest rates will decrease for the calendar quarter beginning Oct. 1, 2011. The rates will be: three (3) percent for overpayments [two (2) percent in the case of a corporation]; three (3) percent for underpayments; five (5) percent for large corporate underpayments; and zero and one-half (0.5) percent for the portion of a corporate overpayment exceeding $10,000.

You are not liable for the late filing penalty if you filed a Federal extension Form 4868. You are possibly still liable for a late payment penalty and interest amount if an underpayment exists.

A number of electronic payment options are available to taxpayers. Payments can be made online, by phone using a credit or debit card or through the Electronic Federal Tax Payment System. Taxpayers who e-file their returns may use the electronic funds withdrawal option for submitting an electronic payment. It’s possible, for example, to e-file in February or March but schedule the payment for withdrawal as late as April 15.Information on these options can be found on the Electronic Payment Options Home Page of IRS.gov. Yes. To pay by credit card, debit card or EFTPS go to irs.gov/e-pay. Generally taxpayers will be able to make payments using American Express, Discover, MasterCard or Visa. Note that Convenience fees (up to 2.35%) will be added to the amount due.