How to calculate interest on taxes on for OVDI penalty

sugnani · Post by **sugnani** » Tue Sep 06, 2011 1:26 am

Hi Friends,

Do you guys know how do I calculate the interest on tax due for OVDI penalty?

Thanks
Sk

tsanaha · Post by **tsanaha** » Tue Sep 06, 2011 5:22 am

you do not have to include interest payment this time --- recent ovdi hotline said "some taxpayers have hard time to figure out the exact interest due to the rate change in years"

however, if you do want to pay this time, it will be fine too. i made a simple xsl file to calculate the total 2011 interest payment, and all you need is to fill the number --- each year of your tax due.

then you have to add 20% on accuracy penalty.

downloading this file

http://157.82.253.148:8080/2011ovdi_interests.xls

i will keep the server running for a short time.. then i will shut it down..

madhoa · Post by **madhoa** » Tue Sep 06, 2011 6:44 am

Technically, the accuracy penalty needs to be compounded separately if you filed an extended return any year, since the accuracy penalty is only from the extended due date, whereas tax due is compounded from the due date.

Also, the %age changes quarterly, not yearly. Plus, its compounded daily, and if you really wanted to be accurate, you would have to take leap years into account as well.

That's the normal rule. I doubt it would be different for OVDI, since the IRS wouldn't want to come up with custom formulas and computer programs for just one group of people.

calgary-alberta · Post by **calgary-alberta** » Tue Sep 06, 2011 12:44 pm

Hi tsanaha,

I tried to download the file but it looks like your server has closed. Could you send the Excel file to my email account: calgary-albertaAThotmail.com

Thanks!

sugnani · Post by **sugnani** » Tue Sep 06, 2011 12:48 pm

Hi tsanaha, i am unable to download the file. Can you please email me to archanasugnani@gmail.com. thanks.

tsanaha · Post by **tsanaha** » Tue Sep 06, 2011 12:53 pm

calgary and sugnani,

I just had the server on for ahort time. please download it now..

as madhoa said, it is not technically 100% accurate.. but it is close enough... and IRS will correct you (either overpay or under pay)

tsanaha · Post by **tsanaha** » Tue Sep 06, 2011 12:53 pm

and please let me know once you get the file.. i will turn off the server.

sugnani · Post by **sugnani** » Tue Sep 06, 2011 12:59 pm

thanks Tsanaha, i was able to download it.

One question: for tax year 2009, do I need to put the amount in Apr-09 or April-10?

tsanaha · Post by **tsanaha** » Tue Sep 06, 2011 1:01 pm

tax year 2009 should be due by April-2010,

tsanaha · Post by **tsanaha** » Wed Sep 07, 2011 5:30 am

Hi Calgary,

Have you downloaded the xsl file yet ? I kept the server running over night and saw a few hits. Let me know if you still want it.

calgary-alberta · Post by **calgary-alberta** » Wed Sep 07, 2011 4:12 pm

Thanks! I got the file.