If you owe tax and don't file on time, the penalty is higher. I just received an IRS notice indicating changes were made to my return, but it appears an attachment to my return which explained the entry changed by IRS, was not considered. If possible, please have a copy of your tax return and the notice when you call. I received an IRS notice resulting from correspondence I sent regarding a change to my return. The notice includes additional penalty and interest charges.
Interest is charged on any unpaid tax from the due date of the return until the date of payment.
The interest rate is determined every three months and is the federal short-term rate plus 3 percent. Interest is compounded daily. In addition, if you filed on time but didn't pay on time, you will generally have to pay a late payment penalty of one-half of one percent of the tax owed for each month, or part of a month, that the tax remains unpaid after the due date, up to 25 percent. The one-half of one percent rate increases to one percent if the tax remains unpaid after several bills have been sent to you and IRS issues a notice of intent to levy. The IRS sent me a letter that included an additional amount of tax due.