Question

2. Zach filed his individual federal tax return for the year ending December 31, 2018 on April 15, 2019 and he owed $25,000. As of December 15, 2019 he still has not paid any of his tax liability. How much does Zach owe as of December 31, 2019

Answer 1

$26,125

Step-by-step explanation:

[($25,000 x 0.005) x 9 + $25,000]

=$26,125

Zach owe $26,125 as of December 31, 2019 because he did not fail to file - he failed to pay. Hence he owes the 0.5% per month or part of a month failure to pay penalty plus the already outstanding tax amount of $25,000 that he owed.