Question

Peter forgot to file his tax return by April 15. He did not file an extension. Peter finally filed his tax return on July 31 and had a remaining tax liability of $3,500. What is Peter's failure to file penalty

Answer 1

Peter's failure to file penalty = $700

Step-by-step explanation:

Peter filed tax return on July 31 after forgetting to file his tax return by April 15 and did not ask for extension. This means that the IRS can impose a 20% penalty on Peter for the tax due on a return where there is negligence, as can be established in this case.

Peter's remaining tax liability = $3,500

Penalty = $700 ($3,500 * 20%)