The IRS has a long list of penalties that they can impose on taxpayers. One of the most common is the failure to pay penalty. Although this is common, it is not one that you should have to deal with. As long as you pay what you owe on time you will never have to worry about paying this penalty.

The failure to pay penalty starts being charged the day after your taxes are due – April 16th. Even if you file for an extension until October 15th, you will still be required to pay taxes owed by April 15th. As you can see, the IRS does not waste any time. If you owe money they make sure that you pay it right away. And if you don’t, you will owe your balance in addition to a failure to pay penalty.

The standard failure to pay penalty is the one that most people in this situation have to deal with. It is a .5 percent monthly penalty on the balance of taxes that is owed. The maximum amount of this penalty is 25 percent. Those who have also paid the maximum failure to file penalty will find the maximum failure to pay penalty to only be 22.5 percent.

If you enter into an installment agreement with the IRS they will cut you a break on the failure to pay penalty. This is because they know you are going to be paying your balance over the course of many months. The failure to pay penalty for those using a payment plan is .25 percent per month. That being said, the maximum is still set at 25 percent.

The failure to pay penalty when a Notice of Intent to Levy has been issued can be higher. Ten days after the notice has been filed, if you have yet to pay your balance the penalty increases from .5 percent to 1 percent per month.

If you have been charged with this penalty and you do have a legitimate reason for not paying your taxes on time, you may be able to get out of paying the penalty. The IRS can take away penalties just as easy as they give them. All you have to do to get the IRS to remove penalties is to show them some basic proof that you had a “reasonable reason” for being able to pay. The IRS accepts a wide variety of excuses and is normally pretty reasonable about accepting people’s reasons. If you want to file for this then you should look more into filing for IRS penalty abatement.

In closing, the IRS failure to pay penalty is something that you want to avoid. If you never owe money to the IRS you will never have to pay this penalty. Keep in mind that the failure to pay penalty can and will change based on your situation. If you are stuck paying this penalty you might as well know what you are up against. The IRS charges these penalties to force taxpayers to stay in compliance with their taxes. The IRS does not want to penalize individuals that had legitimate reason for not filing, so if you have been charged this penalty and have a legitimate reason for not filing, file for penalty abatement.