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Penalties - Sales, Use, Withholding, Fuel, and Income Taxes

10% Penalty for Failure to Timely File a Return:

 If you do not file your return by the due date and at least 90% of the correct tax is not paid, you owe an additional 10% of the unpaid tax.

5% Penalty for Failure to Timely Pay the Tax Due:

 If you file your return on time but do not pay at least 90% of the correct tax due, you owe an additional 5% of the unpaid tax.

You will never be subject to both penalties. 

Fuel Tax Only

 In addition to the penalties described above, the following two penalties also apply to fuel tax:

  • Failure to pay electronically: A penalty of 5% will be added to the tax due if the payment is not received electronically through ePay or ACH Credit as required.
  • Failure to use the required method of filing: The tax return information must be reported through the eFile & Pay system. If not, a penalty of 5% of the amount of tax due will be added.

Willful Failure to File a Return

 The penalty for willful failure to file a return is 75% of the tax due.

Penalty Exception Provisions

 Penalties can be waived only under special circumstances. See Penalty Exception Provisions.

 This summary is based on Rule 421.27.