Late Filing PenaltyName the penalty on the notice
The notice says late filing penalty and shows a figure that depends on which charge it is. We name that penalty, we prepare the return from the closed months, and we set a plan for the year so the next notice is smaller. You meet Steven Palmieri, Tax CFO, while that notice is still unnamed, and Entrepreneur's CFO is the nickname that follows a year with a plan.
Which form is on the notice
A name and a phone are enough. Add the form number if you have it.
You will be talking to the Steven Palmieri practice.
The Tax CFO way with a penalty notice
A preparer can answer the notice and send the payment. A Tax CFO asks why the return was late, finishes the months so the next return is on time, and checks whether the figure was even the right charge before anyone pays it. Steven Palmieri does that second job with you.
Unpaid tax, not income
Five percent of tax still unpaid, for a month or part of a month, with a cap of twenty five percent.
Click to see the base ›Tap to see the base ›
The balance can keep growing
The payment charge keeps running for every month the tax stays unpaid, and the notice does not pause while you decide.
Click to see the balance ›Tap to see the balance ›Do not add the two rates
In a month when both charges run, the filing charge shrinks by the payment charge, so the shared month is already five percent.
Click to see both rates ›Tap to see both rates ›One form, one band
A late information return draws one band for how late that form is.
Click to count the forms ›Tap to count the forms ›
The year can still move
Closed months under that year can still change what the return reports, and sometimes the charge.
Click to name the form ›Tap to name the form ›A state notice is separate
A state notice carries a late rule of its own.
Click to see the boundary ›Tap to see the boundary ›Six rows on one notice
Five rows stay with the month. A hearing leaves.
1Name the filing charge. Stays with the month.Click to see filing charge ›Tap to see filing charge ›
The filing charge takes a share of the tax still unpaid, month by month, and it stops growing once five months have passed.
The filing charge sits on the unpaid tax for that month, and the finished month is what we trust.
2Name the payment charge. Stays with the month.Click to see payment charge ›Tap to see payment charge ›
The payment charge keeps running on the balance after the filing charge has gone quiet, up to its own cap.
The payment charge keeps its own clock after the filing months stop, so the balance stays on the month.
3Keep interest beside both. Stays with the month.Click to see the interest ›Tap to see the interest ›
Interest follows the rate for the quarter and compounds every day. The rate itself stays on the IRS page.
Interest is the quarter's daily rate, and it stays on its own line beside the month.
4Count each late 1099. Stays with the month.Click to see each form ›Tap to see each form ›
One late information return draws one band for how late that form is. Ten forms are ten charges, not a stack of bands.
Each late information return is one band, posted to the month the form was due.
5Separate a partnership base. Stays with the month.Click to see the base ›Tap to see the base ›
A partnership return can carry a base per partner per month even in a year when income tax is zero.
A partnership base can exist when income tax is zero, and that base is a month row.
6A hearing leaves. Leaves this practice.Click to see what leaves ›Tap to see what leaves ›
A hearing or a penalty appeal filed for you belongs with a firm that represents people. We name the row and we stop there.
That hearing leaves this practice and goes to a firm that represents people.
Steven Palmieri, Tax CFO, reads the notice with you and names the charge before anyone pays it.
Click to meet the practice ›Tap to meet the practice ›We read the notice with you on a video call, and we name the charge before anyone talks about paying it.
Which charge is still unnamed
Say what the notice seems to be charging, even if you are unsure.
You will be talking to the Steven Palmieri practice.
Click to read our order ›Tap to read our order ›Read the notice in our order
The bold total is waiting on a name
You opened the envelope after the day was already over. The figure in bold wants to be the whole story. Until it has a name, it is only a total. We slow that moment down on purpose. The form number at the top and the year printed under it do more work than the figure, because they pick which charge you are holding. A partnership return due in the same week still needs its own charge named before anyone trusts that figure. The notice is the subject, whichever kitchen table it landed on, and the month under the figure is the second subject. Ten forms are ten charges, not a stack of bands.
One hard phrase covers a filing charge, a payment charge, interest, a late information return, and a partnership or S corporation base that can exist when income tax is zero. Those are different clocks. Mixing them is how a notice feels larger than the rule behind it. We name one clock at a time, then we look at the month that fed it.
A personal return, a partnership return, and an S corporation return do not share one piece of math. Interest does not share it either. If the envelope holds two forms, they stay on two lines. The company notice and the K-1 are the pair people mash together most often, and we keep them apart before anyone copies a number from the wrong sheet.
What we will say about the figure
Five percent a month sounds like a bite of the whole year. The bite is only of tax still unpaid, and it has a ceiling of twenty five percent. A partial month still counts. The page that owns the base is the unpaid tax page. We will not pretend income was the multiplier.
The payment charge is slower. It can keep running after the filing charge has stopped adding months. Sitting with the figure does not pause the notice while you try to decide what the charge means. When both are alive in the same month, you do not stack the rates. The filing charge is reduced by the payment charge, and that shared month is already five percent. Owners feel a real relief when that reduction shows up, because the scary version had been adding.
Relief itself splits. An automatic path can apply when the prior three years were timely, and interest can remain even then. A reasonable cause request is something you make, or a firm that represents people makes. Relying on a preparer usually does not qualify. Expect us to name the path the three prior years actually support. We will not send the request, and we will not appear at a hearing.
The month under the notice
Naming the charge is an afternoon. Keeping the next one smaller is the monthly work. Closed months under that year can still change what the return reports, and sometimes the charge, even after the year felt finished. We close the books so the bank and the file describe the same month. A statement we will stand behind has to match that bank. When the two disagree, the month remains unfinished and you hear it before we call anything closed.
Payday, when you need it, is set up with a provider who already runs the paydays. We post that provider's reports into the month they belong to. Check stock stays with the company already paying people, and we only line their reports up with the finished month. Owner draws stay on their own line instead of hiding in a pile of odds and ends.
While the year is still open, closed months can still change what the return will say. After the year has closed, the return can only tell the story those months lived. The useful hour is the one that happens before December locks the year. The federal return waits until the months agree. A partnership base can still exist in a year when income tax is zero, so a zero on the tax line is not a reason to skip the form.
What leaves, said once
An audit, a review, or a compilation is a signature that leaves this practice. A hearing leaves too. Foreign account forms, Form 3520, and Form 5471 sit outside. What stays is the name of the charge, the closed month, the statements, and the return prepared from those months.
A notice from a state agency is a different charge with its own late rule. We will not treat that charge as the federal notice in your hand. We will not fold that total into the federal notice, and the workings of that split live on the boundary page. Owners whose company also files a report with one state can read that calendar on its own page. If the honest read is that you need a firm that represents people, you will hear that in the first conversation.
You can also stop at the public page once the charge has a name. Leaving with the right IRS page is a complete visit. Staying so we read the row with you is the other complete visit. Either one starts with the form number.
Source. Public pages we read beside a notice are the failure to file page, the failure to pay page, the information return page, and the quarterly interest page at irs.gov. The public page stands. The dollar tables on those pages are left there, because a copied figure goes stale the quarter the agency replaces it.