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Penalties | Internal Revenue Service

October 20, 2022

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Taxpayers who do not comply with their tax obligations may be fined.

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The Internal Revenue Service charges a fine for various reasons, even if you don’t:

Reading: Pay how much of a penalty?

File your tax return on time
pay any tax you owe on time and in the correct manner
prepare a precise statement
provide accurate information about returns

We may charge interest on a penalty if you do not pay it in full. we charge some penalties every month until you pay the full amount you owe.

Understand the different types of penalties, what to do if you receive a penalty, and how to avoid getting one.

how do you know you owe a fine

When we charge you a fine, we send you a notice or letter in the mail. The notice or letter will tell you about the penalty, the reason for the charge, and what to do next. these notices and letters include an identification number.

verify that the information in your notice or letter is correct. if you can resolve the problem in your notice or letter, a penalty may not apply.

For more information, see your understanding of your notice or letter.

types of sanctions

These are some penalties we sent out notices and letters about:

The informative return applies to taxpayers who do not correctly file or deliver the required informative return or the beneficiary declaration before the due date.
failure to file applies when you don’t file your tax return by the due date.
non-payment applies when you do not pay the tax you owe before the due date.
related to accuracy applies when you don’t claim all of your income or when you claim deductions or credits you don’t qualify for.
Erroneous Claim of Refund or Credit Penalty applies when you file a claim for an income tax refund or credit for an excessive amount and no reasonable cause applies.
A lack of deposit applies when you do not pay your payroll taxes accurately or on time.
Tax Preparer Penalties apply to tax return preparers who engage in misconduct.
Bounced checks apply when your bank won’t accept your check or other form of payment.
Corporate underpayment of estimated tax applies when you fail to pay estimated tax accurately or on time for a corporation.
Individual underpayment of estimated tax applies when you do not pay estimated tax accurately or on time as an individual.
international information reporting applies to certain taxpayers who do not timely and correctly report financial activity from a foreign source.

interest on a fine

We charge interest on fines.

The date from which we start charging interest varies depending on the type of penalty. interest increases the amount you owe until you pay the balance in full. For more information about the interest we charge on fines, see interest.

pay a fine

Send us a payment or pay your taxes in full to avoid future penalties and interest.

remove or reduce a penalty

We may be able to waive or reduce some penalties if you acted in good faith and can show reasonable cause why you were unable to meet your tax obligations. By law, we cannot remove or reduce interest unless the penalty is removed or reduced.

For more information, see Grief Relief.

dispute a penalty

If you disagree with the amount you owe, you can dispute the penalty.

Call us at the toll-free number in the upper right corner of your notice or letter, or write us a letter explaining why we should reconsider the penalty. sign and mail your letter along with supporting documents to the address on your notice.

Have this information when you call or mail your letter:

the notice or letter we sent you
the penalty you want us to reconsider (for example, a 2020 late filing penalty)
for each sanction, an explanation of why you think we should remove it

If a notice or letter we send you has instructions or deadlines for disputing the penalty, please pay close attention. You must follow the instructions to dispute the sanction.

If you didn’t get a notice or letter, get phone support.

avoid a penalty

You can avoid a penalty by filing accurate returns, paying your taxes by the due date, and submitting any information returns on time. if you can’t, you can request an extension of time to file or a payment plan.

request an extension of time to file

If you need more time to prepare your tax return, request an extension to file. this does not give you an extension of time to pay. a payment plan can help you pay over time.

request a payment plan

If you can’t pay your taxes or penalties in full on time, pay what you can now and request a payment plan. You can reduce future fines by setting up a payment plan.