IRS Tax Penalties for Individuals

Underpayment penalty

This penalty is for failing to pay enough in estimated tax or withholding by January 15 of the following year. Compounded daily on the underpayment amount using federal interest rates (currently about 5%).

Late payment penalty

This penalty is for failing to pay the balance due by April 15. .5% per month up to a maximum of 25% on the balance due for every month the payment is late after April 15.

Late filing penalty

This penalty is for failing to timely file or extend your income tax return by the filing date. 5% per month on the balance due up to a maximum of 25% for every month the return is filed after the original or extended due date.