Amending 2005 tax return and I am curious

[AZ-Tax]

what the penalty and/or interest the taxpayer would have to pay for $446 dollars of additional taxes up to May 1st 2009?

Also, I am amending another 2005 tax return and it will generate $2,000 additional refund. Does the IRS have to pay interest on this to the taxpayer and if so how much?

[Bees Knees]

Interest rates on overpayments/underpayments are listed in TTB on page 15-1. The penalty for late paying of tax is listed in TTB on page 15-2.

Do the math, or let IRS do the math. Does it really matter?

[JohnH]

I agree that it really doesn't matter. If you give the client a figure, then they will likely criticize you if the actual amount is greater.

I just tell them there will be additional penalties & interest. If they ask for an estimate, I tell them there are too many variables, including when IRS actually processes the return. If they still insist on an estimate, I give them a figure that I know will be greater than the actual, and explain that "it could be as much as $xxx, but my estimate doesn't really matter since it's the IRS's computers that determine these things". This is to insure that all surprises are pleasant ones. I also tell them to give me a copy of the notice for review when it arrives.

I still double-check the numbers when they get the notice, but I've never found any reason to question the amount billed.