The failure-to-pay penalty — 0.5% of unpaid tax per month, up to 25%. Here is what it means, what usually happens next, and what to do.
On your account transcript it reads: 276 Penalty for late payment of tax Adds to what you owe
TC 276 is the failure-to-pay penalty — 0.5% of the unpaid tax per month, up to 25%. The rate drops to 0.25% while an installment agreement is in effect, and rises to 1% once a notice of intent to levy goes unpaid.
Reversal code: TC 277 — Late payment penalty abated. When it posts after this code, the effect above is undone.
Also written as: IRS code 276, code 276 on transcript, 276 IRS code, transaction code 276.
Unlike the one-time filing penalty, it keeps growing: the transcript shows the amount accrued as of the assessment, and further accruals post over time. It is abatable through first-time abatement or reasonable cause; TC 277 shows an abatement.
| On the same transcript | What it usually means |
|---|---|
| 276 posting repeatedly | Accruing monthly while the balance remains. |
| 276 then 277 | Penalty abated. |
It halves the rate and stops escalation.
If you are eligible.
Removing a penalty also removes the interest charged on it.
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Decode my transcript →The failure-to-pay penalty accrues monthly on the unpaid balance until it is paid or reaches 25%.
The late-payment penalty was abated in part or in whole.
On your IRS account transcript for the tax year — in your IRS Online Account under tax records, or by mail using Form 4506-T. The transactions section lists each code with its description, date and amount. Return transcripts do not show transaction codes.
Yes. IRS code 276, code 276 on transcript, transaction code 276 and TC 276 all refer to the same three-digit transaction code the IRS posts to your account.