Expert: Robin D. replied 4 years ago.
Hello and thank you for using JustAnswer.
From what you have stated, the notice is telling you that the amount used for Business expenses is being disallowed. If you wish to appeal, you have that option. You also may appeal the penalty and interest with the Board of Appeals after you have received a Notice of Assessment.
They assessed the penalty for not paying the tax due. The 5% rate was based on the tax due from the change of your expenses.
I suggest you call the number on your notice and speak with an agent. You are normally given 90 days to appeal the assessment and show your documentation that substantiates your claim for the deduction.
This is the first notice. Why do I have to pay interest? What could an agent do for me? The Business exp. is being disallowed because of a new law, or because of a wrong claim? $409.98 is the amount I have to pay them?
The agent would be able to explain the exact notice content to you and assist in filing the appeal if you wished. The interest is attached because had you not claimed the expense on your tax there would have been more when you filed. There is no new law, they are disallowing because they say you are counting miles to get to your regular place of business and not in the course of leaving that regular place and having to drive around to do business. Yes, the bot***** *****ne what you are telling me. An agent with PA would be able to pull up your account and actually tell you line for line what they are questioning.