Resolving IRS Penalties and Interest

Emerge180 Helps Handle Financial Debts

“We help alleviate the financial stress and anxiety business owners face,” says Jonathan Field, CEO of Emerge180. “We often see companies that are behind with their creditors, are also behind with their taxes.  That is why we have a full service tax division dedicated to helping businesses.”

Several different penalties may be levied against companies. Others apply to individuals as well.

Failure to File Penalty (Applies to corporations and individuals):

The failure-to-file penalty is calculated based on the time from the deadline of your tax return (including extensions) to the date you actually filed it.

Based on the amount due, a 5% penalty accrues each month the return is late up to 25%. If you pass five months, simply multiply your balance due by 25% to calculate your failure to file penalty.

When the overdue amount is more than 60 days after the due date or extended due date, the minimum penalty is the smaller of $100 or 100% of the unpaid tax.

Failure to Pay Penalty (corporations only):

These Deposit Penalties refer to payroll tax deposits.

The IRS may charge penalties if you fail to make required deposits on time, make deposits for less than the required amount or if you do not use EFTPS when required.  For amounts not properly or timely deposited, the penalty rates are:

2%deposits made 1 to 5 days late

5%deposits made 6 to 15 days late

10%deposits made 16 days or more late, but on or before the 10th day after the date of the first notice sent asking for the money owed.

10%deposits made to an unauthorized financial institution, or payments made directly to the IRS, or paid with your tax return.

10%Amounts subject to electronic deposit requirements but not deposited using EFTPS.

15%Amounts still unpaid more than 10 days after the date of the first notice or the day on which you receive notice and demand for immediate payment, whichever is earlier.

*These penalties can reach 65% of the amount owed.

Failure to Pay Penalty (individuals only):

This is determined based on the amount of tax you owe; with penalties of 0.5% each month they are left unpaid. With this, there is no maximum limit. Penalties accumulate from the original payment deadline, April 15, until paid in full.  Also, business owners may be liable for a portion of any unpaid payroll taxes.

As General H. Norman Schwarzkopf said, “Leadership is a combination of strategy and character. If you must be without one, be without the strategy.” Emerge180 offers both qualities.