Compute the penalty amounts

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Problem - Olivia, a calendar year taxpayer, does not file her 2019 Form 1040 until December 12, 2020. At this point, she pays the $40,000 balance due on her 2019 tax liability of $70,000. Olivia did not apply for and obtain any extension of time for filing the 2019 return.When questioned by the IRS on her delinquency, Olivia asserts: "If I was too busy to file my regular tax return, I was too busy to request an extension."

a. Is Olivia liable for any penalties for failure to file and for failure to pay?

b. If so, compute the penalty amounts.

Reference no: EM132664360

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