In case of underpayment of taxes, if the deficiency is not paid in a timely fashion, interest is imposed on the unpaid amount for a period that begins on the date of:
A) Filing return and ends on the date of payment or the last working day of the respective year, whichever is later.
B) Filing return and ends on the date of payment.
C) The notice and demand and ends on the date of payment.
D) The notice and demand and ends on the date when the taxpayer receives the notice.

Question

Quizplus · Accepted Answer

Interest on underpayment of taxes begins on the date of notice and demand (when the IRS informs the taxpayer of the deficiency) and ends on the date of payment. This is outlined in IRS guidelines and regulations.

In Case of Underpayment of Taxes, If the Deficiency Is