Form 8689, also known as the Allocation of Individual Income Tax to the U.S. Virgin Islands, is typically filed by U.S. citizens or residents who have income from the U.S. Virgin Islands and need to allocate a portion of their federal income tax to the USVI. The penalty for the late filing of Form 8689 could include a failure-to-file penalty and potential interest charges. The current penalty for failing to file this form on time is typically 5% of the unpaid tax amount per month, up to a maximum of 25% of the unpaid tax. It's worth noting that penalties may vary based on individual circumstances and the IRS has the authority to waive certain penalties for reasonable cause. It is always recommended to consult with a tax professional or refer to the IRS guidelines for the most accurate and updated information regarding penalties.