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Part 20. Penalty and Interest

Chapter 2. Interest

Section 2. Legal Authorization

20.2.2  Legal Authorization

20.2.2.1  (11-18-2008)
Authorization

  1. In accordance with Internal Revenue Code section 6601(a), 6601(b) and 6611, the payment of interest is required unless specifically prohibited by law or mutual agreement.

    1. IRC section 6601(a) states that if any amount of tax is not paid on or before the last date prescribed for payment, interest on such amount at the underpayment rate established under IRC section 6621 shall be paid for the period from such last date to the date paid.

    2. IRC section 6601(b) states that an extension of time to file or an installment agreement under IRC section 6159 does not extend the time to pay.

    3. IRC section 6611(a) states that interest shall be allowed and paid upon any overpayment of any tax at the overpayment rate established under IRC section 6621.

  2. IRC section 6621 establishes an adjustable interest rate on overpayments or underpayments of tax, tied to the Federal short-term interest rate.

  3. While the above paragraphs deal mostly with "normal interest" computations, information on "restricted interest" and other complex interest computations can be found in later sections of IRM 20.2, Interest. The types of interest are defined in IRM 20.2.1.6, Terminology.

20.2.2.2  (11-18-2008)
Tax Return Due Dates

  1. This section explains the due dates of various types of tax returns. See Exhibit 20.2.2-1 for return due dates.

  2. When a due date falls on a Saturday, Sunday, or legal holiday, the return will be considered timely filed if it is filed on the next succeeding day that is not a Saturday, Sunday, or legal holiday (IRC section 7503).

    Note:

    This rule does not change the actual due date of the return. However, the application of IRC section 7503 may relieve the taxpayer of the liability for late filing and payment penalties.

  3. The term "legal holiday" means a legal holiday in the District of Columbia and, in the case of an act required to be performed in any office of the Internal Revenue Service located outside the District of Columbia, a statewide holiday in the state where such office is located. Holidays that fall on a Saturday are observed the previous Friday and those that fall on a Sunday are observed the following Monday.

  4. Statewide legal holidays and legal holidays in the District of Columbia are (also see IRM 25.6.17.2, List of Legal Holidays):

    • January 1 - New Year's Day

    • Third Monday in January - Martin Luther King Jr. Day

    • January 20 - Inauguration Day (every fourth year following a Presidential election) in the District of Columbia and certain counties in Maryland and Virginia

    • Third Monday in February - Washington's Birthday (also known as President's Day)

    • April 16 - Emancipation Day in the District of Columbia

    • Last Monday in May - Memorial Day

    • July 4 - Independence Day

    • First Monday in September - Labor Day

    • Second Monday in October - Columbus Day

    • November 11 - Veterans Day

    • Fourth Thursday in November - Thanksgiving Day

    • December 25 - Christmas Day

    • Certain Statewide Legal Holidays (e.g., Patriots' Day - third Monday in April for those filing at the Andover Campus)

  5. If a federal holiday is declared by the President or Congress due to the death of a former president, the next business day will be considered timely. The following are considered federal holidays:

    • April 27, 1994 was designated as a legal holiday due to the death of former President Richard M. Nixon.

    • June 11, 2004 was designated as a legal holiday due to the death of former President Ronald W. Reagan.

    • January 2, 2007 was designated as a legal holiday due to the death of former President Gerald R. Ford.

Exhibit 20.2.2-1  (11-18-2008)
Return Due Date Chart

FORM MFT TYPE OF RETURN PERIOD DUE DATE OF RETURN
11C 63 Occupational Tax and Registration Return Wagering July 1st through June 30th Date business commences and yearly thereafter July 1st.
706 52 Estate Tax   Nine months after the exact date of death.
709 51 Gift Tax Calendar Year 15th day of the 4th month following the end of the taxable year (April 15th).
720 03 Excise Tax for all types Quarterly Last day of the month following the end of the quarter.
730 64 Tax on Wagering Monthly Last day of the month following the month in which the earned income becomes taxable.
940 10 Federal Unemployment Taxes (FUTA) Calendar Year Last day of the month following the end of the calendar year (January 31st).
941 01 Withholding and FICA Taxes for Employers Quarterly Last day of the month following the end of the quarter (April 30th, July 31st, October 31st or January 31st).
943 11 Employer's Annual Federal Tax Return for Agricultural Employees Calendar Year Last day of the month following the end of the calendar year (January 31st). If made timely full paid deposits, then due February 11.
944 14 Employer's Annual Federal Tax Return (if instructed by IRS) Calendar Year Last day of the month following the end of the calendar year (January 31st). If made timely full paid deposits, then have 10 extra days.
945 16 Annual Return of Withheld Federal Income Tax Calendar Year Last day of the month following the end of the calendar year (January 31st). If made timely full paid deposits, then due February 11.
990 67 Exempt Organization Calendar Year or Fiscal Year 15th day of the 5th month following the end of the taxable year (calendar year - May 15th).
990PF 44 Private Foundation or section 4947(a)(1) Non-exempt Charitable Trust Calendar Year or Fiscal Year 15th day of the 5th month following the end of the taxable year (calendar year - May 15th).
990T 34 Exempt Organization - Pension Plans per section 401(a), IRA's and Scholarships Calendar Year or Fiscal Year 15th day of the 4th month following the end of the taxable year (calendar year - April 15th).
    Exempt Organization- All other Businesses Calendar Year or Fiscal Year 15th day of the 5th month following the end of the taxable year (calendar year - May 15th).
1040 30 Individual Income Tax Calendar Year or Fiscal Year 15th day of the 4th month following the end of the taxable year (calendar year - April 15th).
1040C 30 U.S. Departing Alien-Individual Income Tax Prior to Departure 15th day of the 4th month following the end of the taxable year (calendar year - April 15th).
1041 05 Income Tax for Estates and Trusts Calendar Year or Fiscal Year 15th day of the 4th month following the end of the taxable year (calendar year - April 15th).
1041-A 36 Information Return - Trust Accumulation of Charitable Amounts Calendar Year 15th day of the 4th month following the end of the taxable year (calendar year - April 15th).
1042 12 Withholding Tax on Foreign Persons Calendar Year 15th day of the 3rd month following the end of the taxable year (calendar year - March 15th).
1042-S 12 Foreign Person's U.S. Source Income Subject to Withholding Calendar Year 15th day of the 3rd month following the end of the taxable year (calendar year - March 15th).
1065 06 Partnership Income Calendar Year or Fiscal Year 15th day of the 4th month following the end of the taxable year (calendar year - April 15th). If books and records are outside of US, then there is an automatic 2 month extension.
1120 02 Corporation Income Tax Calendar Year or Fiscal Year 15th day of the 3rd month following the end of the taxable year (calendar year - March 15th).
1120C 33 US Income Tax Return for Cooperative Associations (Replaces 990C) Calendar Year or Fiscal Year 15th day of the 9th month following the end of the taxable year (calendar year - September 15th).
2290 60 Heavy Vehicle Use Tax July 1st through June 30th Last day of the month following the first month of the taxable year (August 31st).
      First Use, or when first determined that vehicle will exceed 5,000 miles (7,500 for agricultural vehicles) Last day of the month following the month of the first taxable use (vehicle first used in February - return due March 31st).
4720 50 Certain Excise Taxes under Chapters 41 and 42 of the Internal Revenue Code Calendar Year or Fiscal Year 15th day of the 5th month following the end of the taxable year (calendar year - May 15th). Or by due date of organization's 990-PF, 990, 990-EZ, or 5227.
5227 37 Split-Interest Trust Information Calendar Year 15th day of the 4th month following the end of the taxable year (calendar year - April 15th).
CT-1 09 Railroad Retirement Tax Calendar Year Last day of the 2nd month following the end of the taxable year (February 28th or 29th).

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