taxpayer filed his income tax return after the due date but neglected to file an extension form. The return indicated a tax liability of $50,000 and taxes withheld of $45,000. On what amount would the penalties for late filing and late payment be computed?

Question

Miguel Castro

Business

19 January, 01:20

taxpayer filed his income tax return after the due date but neglected to file an extension form. The return indicated a tax liability of $50,000 and taxes withheld of $45,000. On what amount would the penalties for late filing and late payment be computed?

+1

Answers (1)

Know the Answer?

Judith · Answer 1

amount will penalties for late filing and late payment is $5,000

Explanation:

given data

tax liability = $50,000

taxes withheld = $45,000

solution

As late filing and late payment penalty is base on amount of net tax due

so late filing and late payment penalty will be

late filing and late payment penalty = tax liability - taxes withheld

late filing and late payment penalty = $50,000 - $45,000

late filing and late payment penalty = $5000 owed

and

negligence penalty 20% with understatement tax is disregard as any careless and reckless or intentional is not unintentional disregard of tax rules and regulation

so correct answer is $5,000