The due date of the return is determined without regard to any extension of time for filing. The maximum penalty may not exceed 25 percent of the tax. This penalty may be waived if the taxpayer can show that the failure to file was due to reasonable cause and not willful neglect.
Reasonable cause requires the taxpayer to exercise ordinary business care and prudence.
If a taxpayer has exercised such ordinary care and prudence and is nevertheless unable to file the return within the prescribed time, then the delay is due to reasonable cause. Generally, information submitted for reasonable cause will be acceptable in letter form, but in cases of doubt or where evidence of mailing is required, an affidavit should be requested setting forth the reasons for late filing. If there is no response after 30 days, an NPA will be issued, that includes tax and late filing penalties. If there is no response after 30 days, an NPA will be issued, that includes tax, demand penalty, late filing penalty, and a filing enforcement fee. This applies to PIT nonfilers only.