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    #1

    Late Filing Interest Expense

    Can you please tell me if the interest paid when filing a late return is deductible?

    Thank you in advance.
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    #2
    NO deduction

    No it is NOT deductible as it is referred to as a "penalty" even though it is calculated as interest. The reason they call it a penalty is because you can't deduct any penalties.

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      #3
      Interest with penalty

      This interest is considered personal interest (pub 17). Even if there is a Sch C with the return, the fact that it is late is considered personal. And personal interest is not deductible.
      JG

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