Form 1802c Draft - Final Urp Response To Conclusive Correspondence (Page 3 of 5) in pdf

], which includes penalties of $[

] and interest

of $[

] figured to [

]. We'll continue to charge

interest until the amount you owe is paid in full.

We've provided a general explanation of the possible penalties

and/or interest included in the current balance due. If you would like

a specific explanation of how the amounts were computed on your

account, please contact us at the toll-free number shown in this

letter, and we will send a detailed computation.

** Filing and/or Paying Late -- IRC Section 6651 **

We charge a 5% penalty for filing late, and 1/2% penalty for paying

late, when a return is filed late and the tax is not paid by the date

it was due. When both penalties apply for the same month, the penalty

for filing late is reduced by the amount of the penalty for paying

late for that month.

The penalty for filing late is based on the tax ultimately due,

which was not paid by the original return due date without regard

to extensions.

The penalty for paying late is based on the net unpaid tax at the

beginning of each penalty month following the payment due date

for that tax.

The penalties are charged for each month or part of a month the

return or payment is late; however, neither penalty can be more

than 25% in total.

Income tax returns are subject to a minimum penalty if filed

late and received more than 60 days after the due date. The

minimum penalty is $135 ($100 for returns due before 1/1/2009)

or 100% of the tax paid late, whichever is less.

The penalty for paying late applies when tax is paid late, even

if the return was filed on time. The due date for payment of

tax shown on a return generally is the return due date without

regard to extensions. Increases in tax must be paid within 21

days of our notice demanding payment (10 business days if the

amount in the notice is $100,000 or more).

If we issue a Notice of Intent to Levy and the balance due isn't

paid within 10 days from the date of the notice, the penalty for

paying late increases to 1% per month.

For individuals who filed on time, the penalty decreases to 1/4%

per month while an approved installment agreement with the IRS

is in effect for payment of that tax.

** Interest -- IRC Section 6601 **

We are required by law to charge interest when you do not pay your

liability on time. Generally, we calculate interest from the due date

of your return (regardless of extensions) until you pay the amount you

owe in full, including accrued interest and any penalty charges.

Interest on some penalties accrues from the date we notify you of the

Form 1802c Draft - Final Urp Response To Conclusive Correspondence Page 3

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