2290 tax penalties and Interest are a bummer to put it mildly. But for the industrious 2290 taxpayer, there is often a way to minimize the damage.
What are Form 2290 Tax Penalties?
Like every other federal tax form, late filing of Tax Form 2290 will result in penalties and interest. The exact amount can only be calculated by the IRS because nobody does things the way the IRS does things. When e-filing late, you’ll only pay the original taxes at the time of filing. After your 2290 has been processed, you likely get an IRS notice in the mail like this one if penalties and interest are assessed.
According to the D.O.T. pamphlet, “The Heavy Vehicle Use Tax. Funding our Nation’s Highway Programs and Leveling the Playing Field” Form 2290 tax penalties are broken up into two distinct parts. Penalties and Interest.
The total penalty for taxes not paid is calculated on a monthly basis and is about 4.5% of the total tax due. If you have one truck at 80,000 lbs and are only one month late, the math goes like this:
$550 x 4.5% = $24.75
They can add penalties up for five (5) months. That means you can be charged over $120.00 on top of your original $550 tax payment – just for penalties!
In addition to penalties, the IRS can also charge interest of a little more than .5% (half of a percentage point) per month. The bottom line here is that if you’re filing five (5) months late, your interest and penalties can climb to around $150 on top of your original $550 tax payment.
Getting the penalties and interest waived
If a first time filer of Form 2290 is late, it’s possible to get penalties waived. Just call the IRS Directly and ask. Believe it or not, the IRS is often times reasonable on this Tax Form.
Toll Free: 866-699-4096
Also, if it’s the first time you’re late but have a solid filing history for the three (3) previous years, you can usually get 2290 tax penalties waived. Just call the IRS and ask.
The second time a 2290 taxpayer wants penalties and interest waived they can still call that same number. However, because it’s the second time around, “reasonable cause” is needed.
What’s a reasonable cause?
There is no specific answer here. There are lots of reasonable causes, and in the end it depends on the circumstances. Here are some examples:
- Notification of a changed due date was not received
- The taxpayer spend time in the Hospital
- The check was lost in the mail
- A Natural Disaster
- A Death in the family
These are just examples and may or may not work for you. Whatever reason you give, be sure that it’s true and you can provide proof. The IRS will likely ask for some form of proof and your relief may be dependent on them receiving it.
You can check out Internal Revenue Code Publication 510 – for full detail on excise tax regulations regarding interest, penalties and reasons for them to be waived. See chapter 13, page 42-43.
Want to avoid Penalties entirely?
If you want to avoid unnecessary 2290 tax penalties entirely, file early in July. And sign up with one of the many free notification services 2290Tax.com offers below and get emails, tweets, and Facebook announcements early, often and with any other important news.