MARK KOHLERMain Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, LLC · Owner at Main Street Professionals, LLC

The Business Killer Penalty The IRS Never Explains

24 Apr 2026 · 1 min

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1:04

In this segment, Mark Kohler breaks down the financial consequences of missing tax filing deadlines and paying taxes late. He explains that filing an extension incurs a penalty and interest of roughly 1% per month on any owed amount, which can add up to about $6,000 on a $100,000 liability over six months. He then details the much harsher failure‑to‑file penalty, which adds a 5% monthly charge on top of the 1% extension rate, effectively reaching about 6% per month. The failure‑to‑pay penalty is an additional 0.5% per month plus interest. Kohler emphasizes that the quickest way to stop these escalating penalties is to file the return immediately, even if the taxpayer cannot yet pay the full amount, urging viewers not to delay out of embarrassment or fear.

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If you file an extension, it's approximately 1% per month for penalties and interest, approximately. So if you owe $100,000, it's going to go $1,000 a month, $6,000. If you wait till October, it'll be around $6,000. Now let me just say, the failure to file kicks in if you don't file. So let's transition to the second worst scenario. You did not file an extension. Now some of you listening to me, this is after April 15th, you're like, holy crap, I wish I would have filed an extension. Okay, you You didn't. Don't beat yourself up. You filed prior years. This is just 2025 we're looking at. This is this category. Could be $10,000, could be $100,000. But what's going to kick you in the can is this failure to file. Now, that's 5% on top of that 1% I was talking about. Now it's 5% on top of that. Failure to file is 5% a month. Failure to pay is the half a percent plus the interest on that. So now you got that 1% hanging over here plus the 5%. That's about approximately 6% a month adding up quick. So what's your solution? File. File right away. Even if you owe. At least file. Yeah, you're like, well, I don't want to tell the IRS. You already owe them.