Andrea files her current year tax return on June 18 of the following year. On August 8 she pays the amount due, if any, without requesting an extension. The tax shown on her return is $32,000. Andrea pays no estimated taxes and claims no tax credits on her current year return. Read the requirements. Requirement a. What penalties will the IRS likely impose on Andrea (ignoring the penalty for underpayment of estimated taxes)? On what dollar amount, and for how many days, will Andrea owe interest? Assume Andrea committed no fraud and that any penalty and interest period begins on April 16. Assume her wage withholding tax amounts to $25,000. Complete the table below to show the penalties that the IRS will likely impose on Andrea. Failure-to-pay penalty Failure-to-file penalty Minus: Reduction for failure-to-pay penalty imposed for same period Total penalties 7000 Requirements What penalties will the IRS likely impose on Andrea (ignoring the penalty for underpayment of estimated taxes)? On what dollar amount, and for how many days, will Andrea owe interest? Assume Andrea committed no fraud and that any penalty and interest period begins on April 16. a. Assume her wage withholding tax amounts to $25,000 b. Assume her wage withholding tax amounts to $34,000 c. How would your answer to Part a change if Andrea requests an automatic extension? Print Done
Andrea files her current year tax return on June 18 of the following year. On August 8 she pays the amount due, if any, without requesting an extension. The tax shown on her return is $32,000. Andrea pays no estimated taxes and claims no tax credits on her current year return. Read the requirements. Requirement a. What penalties will the IRS likely impose on Andrea (ignoring the penalty for underpayment of estimated taxes)? On what dollar amount, and for how many days, will Andrea owe interest? Assume Andrea committed no fraud and that any penalty and interest period begins on April 16. Assume her wage withholding tax amounts to $25,000. Complete the table below to show the penalties that the IRS will likely impose on Andrea. Failure-to-pay penalty Failure-to-file penalty Minus: Reduction for failure-to-pay penalty imposed for same period Total penalties 7000 Requirements What penalties will the IRS likely impose on Andrea (ignoring the penalty for underpayment of estimated taxes)? On what dollar amount, and for how many days, will Andrea owe interest? Assume Andrea committed no fraud and that any penalty and interest period begins on April 16. a. Assume her wage withholding tax amounts to $25,000 b. Assume her wage withholding tax amounts to $34,000 c. How would your answer to Part a change if Andrea requests an automatic extension? Print Done
Chapter26: Tax Practice And Ethics
Section: Chapter Questions
Problem 23P
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Transcribed Image Text:Andrea files her current year tax return on June 18 of the following year. On August 8 she pays the amount due, if any, without requesting an extension. The tax shown on her return is $32,000. Andrea pays no estimated taxes and claims no tax credits on her current year return.
Read the requirements.
Requirement a. What penalties will the IRS likely impose on Andrea (ignoring the penalty for underpayment of estimated taxes)? On what dollar amount, and for how many days, will Andrea owe interest? Assume Andrea committed no fraud and that any penalty and interest
period begins on April 16. Assume her wage withholding tax amounts to $25,000.
Complete the table below to show the penalties that the IRS will likely impose on Andrea.
Failure-to-pay penalty
Failure-to-file penalty
Minus: Reduction for failure-to-pay penalty imposed for same period
Total penalties
7000
Requirements
What penalties will the IRS likely impose on Andrea (ignoring the penalty for
underpayment of estimated taxes)? On what dollar amount, and for how
many days, will Andrea owe interest? Assume Andrea committed no fraud and
that any penalty and interest period begins on April 16.
a. Assume her wage withholding tax amounts to $25,000
b. Assume her wage withholding tax amounts to $34,000
c. How would your answer to Part a change if Andrea requests an
automatic extension?
Print
Done
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