John forgot to file his tax return by April 15.He did not file an extension.John finally filed his tax return on June 30 and had a remaining tax liability of $1,500.What is John's failure to file penalty? Assume he made all his payments on time.
A)$375.
B)$225.
C)$233.
D)$300.

Question

Quizplus · Accepted Answer

The failure to file penalty is 5% of the unpaid taxes for each month or part of a month that a tax return is late, up to a maximum of 25%. Since John filed his return 2.5 months late (April 15 to June 30), the penalty is 5% * 2.5 = 12.5% of $1,500, which equals $187.50. However, the minimum penalty for returns filed more than 60 days late is the lesser of $435 or 100% of the unpaid tax. Since the calculated penalty ($187.50) is less than both $435 and 100% of the unpaid tax ($1,500), the correct penalty is $187.50. The provided options do not include $187.50, suggesting a mistake in the question or answer choices. Based on the closest available option, $225 would be considered an incorrect choice, indicating a potential error in the question setup or a misunderstanding of the penalty calculation.

John Forgot to File His Tax Return by April 15