per centum per month from the date the tax became due until paid. * * *
Section 404 of the Revenue Act of 1935
Notwithstanding any provision of law to the contrary, interest accruing during any period of time after the date of the enactment of the this Act upon any internal-revenue tax (including amounts assessed or collected as a part thereof) or customs duty, not paid when due, shall be at the rate of 6 per centum per annum.
Section 406 of the Revenue Act of 1935
In the case of a failure to make and file an internal-revenue tax return required by law, within the time prescribed by law or prescribed by the Commissioner in pursuance of law, if the last date so prescribed for filing the return is after the date of the enactment of this Act, if a 25 per centum addition to the tax is prescribed by existing law, then there shall be added to the tax, in lieu of such 25 per centum; 5 per centum if the failure is not more than 30 days, with an additional 5 per centum for each additional 30 days or fraction thereof during which failure continues, not to exceed 25 per centum in the aggregate.
Section 3176, as amended, United States Revised Statutes as amended by section 1103 of the Revenue Act of 1926
* * * In case of any failure to make and file a return or list within the time prescribed by law, or prescribed by the Commissioner of Internal Revenue or the collector in pursuance of law, the Commissioner shall add to the tax 25 per centum of its amount, except that when a return is filed after such time and it is shown that the failure to file it was due to a reasonable cause and not to willful neglect, no such addition shall be made to the tax. In case a false or fraudulent return or list is willfully made, the Commissioner shall add to the tax 50 per centum of its amount.
The amount so added to any tax shall be collected at the same time and in the same manner and as a part of the tax unless the tax has been paid before the discovery of the neglect, falsity, or fraud, in which case the amount so added shall be collected in the same manner as the tax.
Section 3184 of the United States Revised Statutes
Sec. 3184. Where it it not otherwise provided, the collector shall in person or by deputy, within ten days after receiving any list of taxes from the Commissioner of Internal Revenue, give notice to each person liable to pay any taxes stated therein, to be left at his dwelling or usual place of business, or to be sent by mail, stating the amount of such taxes and demanding payment thereof. If such person does not pay the taxes within ten days after the service or the sending by mail of such notice, it shall be the duty of the collector or his deputy to collect said taxes with a penalty of five per centum additional upon the amount of taxes, and interest at the rate of one per centum a month.
Art. 502 Interest and penalties.—A failure to file a return when due causes to accrue, under the provisions of section 406 of the Revenue Act of 1935, a penalty of from 5 per cent to 25 per cent of the amount of the tax, depending upon the period of delinquency.
Failure to pay the tax when due and payable cause to accrue, under the provisions of section 404 of the Revenue Act of 1935, interest at the rate of one-half of 1 per cent a month from the time when the tax became due until assessed, or until paid prior to assessment.
If assessment is made of the tax, penalty, or interest, and payment is not made within 10 days after the issuance of the form for first notice and demand, based on assessment approved by the Commissioner, there will accrue under section 3184, Revised Statutes, a 5 percent penalty and interest at the rate of one-half of 1 percent per month (see section 404 of the Revenue Act of 1935) computed on the entire assessment (including penalty and interest, if any) from 10 days after issuance of said form until date of payment. In cases where assessment is settled by partial payments, interest should be computed from the expiration of the first 10-day notice through the date of the first payment and from the next succeeding day to the date of the next payment, until assessment is paid in full.
If a claim for abatement is filed with the collector within 10 days after the date of the issuance of the first notice and demand, the 5-percent penalty does not attach. If the assessment is not paid within 10 days after receipt of notice of rejection of claim, the 5-percent penalty applies. The filing of the claim does not stay the running of interest, which continues to run for the full period that intervenes between the date of expiration of the first notice and demand and the date of payment.
If a false or fraudulent return be willfully made, the penalty under section 3176 of the Revised Statutes is 50 percent of the total tax.
Under section 1114 of the Revenue Act of 1926 (see paragraph 17, Appendix B) any person who willfully fails to pay or collect any tax due, file return, or keep records, or who attempts in any manner to evade or defeat the tax, is subject to a fine of $10,000 or imprisonment, or both, with costs of prosecution, and is also liable to a penalty equal to the amount of the tax not collected or paid. These penalties apply to an officer or employee who, as such officer or employee, is under a duty to perform the act in respect of which the violation occurs, as well as to a person who fails or refuses to perform any of the duties imposed by the Act, i. e., pay the tax, make return, keep records, supply information, etc.
Credits and Refunds
Except as otherwise provided * * * the Commissioner of Internal Revenue, subject to regulations prescribed by the Secretary of the Treasury, is authorized to remit, refund, and pay back all taxes erroneously or illegally assessed or collected, all penalties collected without authority, and all taxes that appear to be unjustly assessed or excessive in amount, or in any manner wrongfully collected; * * *
All claims for the refunding or crediting of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty alleged to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected must, * * * be presented to the Commissioner of Internal Revenue within four years next after the payment of such tax, penalty, or sum. The amount of the refund * * * shall not exceed the portion of the tax, penalty, or sum paid during the four years immediately preceding the filing of the claim, or if no claim was filed, then during the four years immediately preceding the allowance of the refund.
Art. 503. Refund and credit of taxes erroneously collected.—(a) A tax (including interest, penalties, and additions to tax) erroneously, illegally, or otherwise wrongfully collected, may be credited or refunded to the person who paid the tax. A claim for such credit or refund shall be made on Form 843 in accordance with the instructions printed on such form and in accordance with these regulations. Copies of the prescribed form may be obtained from any collector. A separate claim on such form shall be made for each taxable year or period. All grounds in detail and all facts alleged in support of the claim must be clearly set forth under oath.
(b) The claim must be accompanied by a certificate of the proper State officer showing (1) whether a claim for refund or credit with respect to any contributions paid by the taxpayer into a State unemployment fund for the taxable year is pending, (2) whether a refund or credit with respect to any such contributions has been authorized, and (3) if such a refund or credit has been made, the amount and date thereof and grounds therefor.
