Penalty and Interest Added for Filing or Paying Late

The Revenue Act includes provisions for charging penalty and interest if a taxpayer fails to pay a tax within the time specified.

INTEREST
Interest is calculated by multiplying the current interest rate .

PENALTY – After February 28, 2003
If a “BILL FOR TAXES DUE (INTENT TO ASSESS)” is issued after February 28, 2003:

Penalty is 5 percent of the total unpaid tax due for the first two months. After two months, 5% of the unpaid tax amount is assessed each month. The maximum late penalty is equal to 25% of the unpaid tax owed.

Estimate the penalty and interest for an “INTENT TO ASSESS” issued after 2/28/2003

PENALTY – Prior To February 28, 2003
If a “BILL FOR TAXES DUE (INTENT TO ASSESS)” was issued before February 28, 2003:

Penalty is 5 percent of the unpaid tax due each month until you file and pay. The maximum late penalty is 50% of the unpaid tax amount. The minimum late penalty is $10 for the first month or 5% of the tax due, whichever is greater.