Daniel Cullinane CPA
25 Plaza 5 25th fl Jersey City NJ phone 732-516-1648 fax 732-516-9778
2500 Plaza 5 25th fl Jersey City NJ 07311 phone 732-516-1648 fax 732-516-9778
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I AM FROM
THE IRS &
I AM HERE
For certain situations taxpayers may abate, or have their penalty removed. You have to establish reasonable cause criteria. Usually, the circumstance that determined how you got behind will determine whether you have a case or not.
The penalty for filing late is usually 5% of the unpaid taxes for each month or part of a month that a return is late. This penalty will not exceed 25 percent of your unpaid tax.
If you file your return more than 60 days after the due date or extended due date, the minimum penalty is the smaller of $153 or 100% or the unpaid tax.
If you do not pay your taxes by the due date, you generally have to pay a failure to pay penalty of half of one percent of your unpaid taxes for each month after the due date that the taxes are not paid. This penalty can be as much as 25% of your unpaid tax.
If you timely filed a request for an extension of time to file and you paid at least 90% of your actual tax liability by the original due date, you will not be faced with a failure to pay penalty if the remaining balance is paid by the extended due date.
If both the failure to file penalty and the failure to pay penalty in any month, the 5% failure to file penalty is reduced by the failure to pay penalty. However, if you file your return more than 60 days after the due date or extended due date, the minimum penalty is the smaller of $135 or 100% of the unpaid tax.
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TAX PENALTY ABATEMENT