It depends on the situation. If you file your tax return late, the initial penalty for late filing is 5% of the tax due on the late return for each month, or fraction of a month, that you did not file, up to 25% of the tax due. The late filing penalty can increase further if the failure to file is deemed to be an act of fraudulent tax evasion. Jail sentences are also possible. There is also a penalty for people who file a return but do not make a payment. The initial late payment penalty is 0.5% of the tax due for each month, or fraction of a month, that taxes are overdue, up to 25% of the overdue taxes. In addition to these penalties, interest also accrues on unpaid tax balances.
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