§6656. Failure to make deposit of taxes

(a) Underpayment of deposits

In the case of any failure by any person to deposit (as required by this title or by regulations of the Secretary under this title) on the date prescribed therefor any amount of tax imposed by this title in such government depository as is authorized under section 6302(c) to receive such deposit, unless it is shown that such failure is due to reasonable cause and not due to willful neglect, there shall be imposed upon such person a penalty equal to the applicable percentage of the amount of the underpayment.

(b) Definitions

For purposes of subsection (a)-

(1) Applicable percentage

(A) In general

Except as provided in subparagraph (B), the term "applicable percentage" means-

(i) 2 percent if the failure is for not more than 5 days,

(ii) 5 percent if the failure is for more than 5 days but not more than 15 days, and

(iii) 10 percent if the failure is for more than 15 days.

(B) Special rule

In any case where the tax is not deposited on or before the earlier of-

(i) the day 10 days after the date of the first delinquency notice to the taxpayer under section 6303, or

(ii) the day on which notice and demand for immediate payment is given under section 6861 or 6862 or the last sentence of section 6331(a),

the applicable percentage shall be 15 percent.

(2) Underpayment

The term "underpayment" means the excess of the amount of the tax required to be deposited over the amount, if any, thereof deposited on or before the date prescribed therefor.

(Aug. 16, 1954, ch. 736, 68A Stat. 826 ; Dec. 30, 1969, Pub. L. 91–172, title IX, §943(b), 83 Stat. 728 ; Oct. 4, 1976, Pub. L. 94–455, title XIX, §1906(b)(13)(A), 90 Stat. 1834 ; Aug. 13, 1981, Pub. L. 97–34, title VII, §724(a), (b)(1), (3), 95 Stat. 344 , 345; Oct. 21, 1986, Pub. L. 99–509, title VIII, §8001(a), 100 Stat. 1951 ; Dec. 19, 1989, Pub. L. 101–239, title VII, §7742(a), 103 Stat. 2405 .)

Amendments

1989-Pub. L. 101–239 substituted "taxes" for "taxes or overstatement of deposits" as section catchline and amended text generally, revising substance and structure.

1986-Subsec. (a). Pub. L. 99–509 substituted "10 percent" for "5 percent".

1981-Pub. L. 97–34, §724(b)(1), inserted "or overstatement of deposits" after "taxes" in section catchline.

Subsec. (a). Pub. L. 97–34, §724(b)(3), substituted "Underpayment of deposits" for "Penalty" in heading.

Subsec. (b). Pub. L. 97–34, §724(a), substituted provisions relating to conditions for imposition of penalties for overstated deposit claims and definition of "overstated deposit claim", for provisions relating to imposition of penalties after due date for return.

1976-Subsec. (a). Pub. L. 94–455 struck out "or his delegate" after "Secretary".

1969-Subsec. (a). Pub. L. 91–172 substituted provisions imposing a penalty of five percent for the failure to deposit on the date prescribed any amount of tax imposed by this title, for provisions imposing a penalty of one percent of the amount of underpayment each month but not to exceed six percent in the aggregate.

Effective Date of 1989 Amendment

Section 7742(c) of Pub. L. 101–239 provided that: "The amendments made by this section [amending this section] shall apply to deposits required to be made after December 31, 1989."

Effective Date of 1986 Amendment

Section 8001(b) of Pub. L. 99–509 provided that: "The amendment made by subsection (a) [amending this section] shall apply to penalties assessed after the date of the enactment of this Act [Oct. 21, 1986]."

Effective Date of 1981 Amendment

Section 724(c) of Pub. L. 97–34 provided that: "The amendments made by this section [amending this section and sections 5684 and 5761 of this title] shall apply to returns filed after the date of the enactment of this Act [Aug. 13, 1981]."

Effective Date of 1969 Amendment

Amendment by Pub. L. 91–172 applicable with respect to deposits the time for making of which is after Dec. 31, 1969, see section 943(d) of Pub. L. 91–172, set out as a note under section 6651 of this title.

Section Referred to in Other Sections

This section is referred to in sections 5684, 5761 of this title.