Noel, a calendar-year taxpayer, filed his 2016 income tax return on October 20, 2017, paying an amount due of $2,000 . On April 1, 2017, he had obtained a six- month extension of time in which to file his return. However, he could not assert a reasonable cause for failing to file the return by October 15, 2017 (the extended due date), nor did he show any reasonable cause for failing to pay the

tax that was due on April 15, 2017 . Noel's failure to file was not fraudulent. The penalty for failure-to-pay tax is:
a. $35
b. $10
c. $70
d. $40


c
RATIONALE: FEEDBACK: Underpayment $2,000
Penalty (%) x 0.5% Penalty per month outstanding $10 Months (or fractions thereof) for which required payment was not made 7 Failure-to-pay penalty $70

Business

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