Tax Penalties and Interest

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Tax penalties are incurred for late filing, late payment, or incorrect filing of tax forms. The revenue authorities have the authority to level fines to encourage compliance with the system of voluntary reporting. Often, if the problems are accidental and not systemic, these fines can be waived, but it is at the discretion of the government official. The ability to waive the tax penalties is one of the negotiating tools available to government officials trying to collect taxes due.

Tax penalties and interest, are the bane of the tax preparer, and the most painful thing to tax filers. These related things are when the government charges you interest for being underpaid, or a penalty rate for non-compliance. The penalties can sometimes be lifted as part of a compliance process, but interest is usually fixed. Ironically, the government is often able to avoid paying you interest, but demands it pretty quickly.

For a failure to file an extension on time, your tax penalties will start from the momember of the original due date. If you file your extension, you will generally avoid tax penalties if you file by the extended date. Depending on the government agency, the penalties and interest may date back to the original filing date or the extended date.

The best way to limit your tax penalties and interest is to keep good solid records and file your tax forms on a timely basis. We encourage our tax clients to choose the appropriate one of our monthly packages, to allow us to focus on IRS compliance and they focus on their business.

Filing a Previous Year’s Tax Return

By |2023-06-16T10:33:51-04:00May 30th, 2023|Categories: #TaxTipTuesday|Tags: , , , , |

I will discuss how and why to file taxes for a previous year. Filing and paying taxes may not be thrilling, but ignoring them leads to costly IRS penalties and interest. So, if you want to learn more about this topic, keep reading.

IRS Debt

By |2023-04-11T13:09:27-04:00April 11th, 2023|Categories: Quickies with Bette|Tags: , , , |

I will discuss ways to pay off IRS tax debt. Unpaid tax debts can affect us greatly, and these come from penalties and interest. While people fall behind on filing and paying their taxes for many reasons, the stress of how you will pay doesn’t have to be one of them. 

Bobby Bonilla Day

By |2022-12-16T14:07:23-05:00June 30th, 2021|Categories: Quickies with Bette|Tags: , , , , |

Tomorrow is Bobby Bonilla Day. Bobby Bonilla is a former player in Major League Baseball who played in the major leagues from 1986 to 2001. This day is celebrated by the sports and financial world! Why? Because the Mets pay Bonilla $1,193,248.20 every July 1 from 2011 until 2035.

Estimated Tax Payment Two

By |2021-06-15T15:44:00-04:00June 15th, 2021|Categories: #TaxTipTuesday, Deadlines and Updates|Tags: , , , , |

Today's Tax Tip Tuesday is your reminder to pay your second 2021 quarterly estimated tax payment if you're somebody who needs to pay those, many people don't pay them. If you only have a job where you get a W2 and you're on the payroll, probably aren't making estimated payments, but if you're a business owner or a freelancer something like that, you're probably having to make these payments. So how do you know how much to pay?

Foreign Tax Issues for US Citizens Video

By |2022-12-16T10:46:25-05:00June 11th, 2021|Categories: #FinanceFriday|Tags: , , , , , , , , |

Today on Finance Friday, we discuss foreign tax issues for US citizens with Andre Benayoun JD, BBA. Andre is one of the most brilliant people I know; he is a partner at Marcum Accountants & Advisors and a family friend.

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