Does anybody knows a link where you figuring late penalties and interest by using the calculator. I looked at the www.irs.gov, but could not find the calculator for it.
Thanks,
Thanks,
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I don't know about a calculator, but you can get pretty close by multiplying the balance due by 5% per month for the Failure to File penalty, plus about 1.25% per month for the sum of the interest and Failure to Pay penalty. That will usually get you in the ballpark.
The FTF penalty maxes out at 25% (5 months) and there is a little bit of offset against the FTP penalty, but this is close enough. Your calculations will never be exact because the piece of info you are missing is when the payment was actually rfeceived and processed by IRS.
Depending upon the circumstances, there can also be an estimated tax penalty due. It's a little more difficult to estimate, but I use 4.5% of the balance due at 4/15, plus .75% per month for every month past 4/15.
Add 'em all up and you will usually be within a few dollars of the IRS calculation."The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith -
I've been using this program:
Pretty good program. Only thing is you have to enter in the interest rate for each new year. Other than that it does a very good job for the price. I had a customer that did not file for two years. I did a calculation with this program and I think it was $100 short of what the IRS came up with. FTF penalty really gets them.Comment
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Geekgirl, the reason your answer was not exact is that the interest rate can be changed every quarter. It is rare that you will have an entire year at the same interest rate, although a few years ago it went unchanged for 6 qtrs.Comment
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