If I payed a penalty and interest and filing cost for payment plan. Is all those cost itimized deduction? Do they have to meet 2%?
2007-02-06 07:05:17 · 6 answers · asked by toddrws 1 in Business & Finance ➔ Taxes ➔ United States
This was for federal income tax. Wouldn't the additional cost penalty, interest, etc be allowed to deducted?
2007-02-06 07:17:02 · update #1
Interest on federal, state or local taxes is considered personal interest and is not deductible. Neither are penalties.
2007-02-06 07:23:00 · answer #1 · answered by Judy 7 · 2⤊ 1⤋
If the Taxes, penalties and interest were a Federal Tax debt, they can not be deducted on your tax return. This is tax that you owe for a previous year.
If it was for a state tax that you paid and you itemize your deductions on Schedule A rather than taking the Standard deduction, the you could claim only the state tax you paid, but not the penalty and interest
2007-02-06 15:11:13 · answer #2 · answered by Rob 7 · 0⤊ 1⤋
Interest and penalties on tax due, regardless of whether it is federal or state taxes, are never deductible. In fact, any penalties you pay, are never deductible. For example, say you use your car 100% for business, so all of your car expenses are fully deductible. If you get a speeding ticket or parking ticket with that car, the cost of the ticket is never deductible.
2007-02-06 15:22:16 · answer #3 · answered by jseah114 6 · 2⤊ 1⤋
To my knowledge the taxes and penalty you paid are not deductible. Check IRS Pub 17 or www.irs.gov.
2007-02-06 15:08:52 · answer #4 · answered by cinsingl83 3 · 0⤊ 1⤋
you can't deduct interest & penalties!
2007-02-06 15:45:30 · answer #5 · answered by Dizney 5 · 0⤊ 1⤋
No, they're not deductible.
2007-02-06 15:12:12 · answer #6 · answered by Bostonian In MO 7 · 2⤊ 1⤋