Can I deduct a tax penalty paid last year from my 2023 federal taxes? I underpaid by $14 and was penalized $443.75 with interest of $19.92

posted

Connect with an expert

3 Replies

Can I deduct a tax penalty paid last year from my 2023 federal taxes? I underpaid by $14 and was penalized $443.75 with interest of $19.92

No---federal tax and/or penalties you paid are not deductible.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

Can I deduct a tax penalty paid last year from my 2023 federal taxes? I underpaid by $14 and was penalized $443.75 with interest of $19.92

the interest is also not deductible.

Can I deduct a tax penalty paid last year from my 2023 federal taxes? I underpaid by $14 and was penalized $443.75 with interest of $19.92

There is a cap on the amount of penalty and interest that can be applied to an underpaid return. If you really underpaid by $14 than the maximum penalty and interest would not exceed $3.50.

I believe that you underpaid by enough so that the $443.75 was taxes owed plus penalty and interest. In any case the penalty and interest are not tax deductible.

Still have questions?