Los Angeles, CA · Member since 2015 · 42 posts · 7 votes
Since I sold a property last year, I have a lot of capital gains tax to pay. There's an option to pay in installments within 6 a month period, but with fees and interest. It doesn't say how much the fees and interest are. Does anyone know if this is a good idea or if I should pay the amount in full? Thanks.
Current interest rate is 7%, plus 0.5% per month of late payment penalty, which is basically another 6% of annual interest. So you're getting a loan from the IRS at 13%. Not great at all. If you have the money, pay ASAP.
By the way, their new month and new month penalty starts on 15th of each month, so pay before the 15th.