The assumptions are that the IRS rate is
5%, interest calculations are based on 365 days a year and the 2018
tax filed is accurate
The options for the boxes are penalty for fraud, accuracy related penalty, interest, late filing : failure to file penalty, late payment : failure to pay penalty
Homework Answers
Since Peter has not filed his return nor paid due tax within due date, he is liable for interest plus penalty for late filing and late payment.
Interest ($4,500*5/100*235/365) = $ 144.86
Late Payment : Failure to pay penalty = $ 202.50
($ 4,500*.05/100*9 months)
Late Filing : Failure to file penalty = $ 922.50
($ 4,500*5/100*5 months)-($ 202.5)
Total Additional Amount Due = $ 1,269.86
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