The real cost of not paying your taxes until October 15!
This time of year we often see taxpayer's looking to extend the time to pay their taxes due and asking, "what are the penalties if I do not pay my taxes due by April 15." Here I will address how to estimate the cost of not paying timely - the penalties assessed by the IRS.
Keeping the Tax Underpayment Penalty at Bay
With the 2013 tax year behind you, now is the time to plan appropriately to make sufficient estimated tax payments. An underpayment of estimated tax may apply if you still owe $1,000 or more in additional tax after accounting for withholdings and estimated payments made throughout the year. Remember, to avoid underpayment penalties you are required to prepay either;