Any Extension Penalty if Balance Due <$1,000?

[North Texas CPA]

Is there any extension penalty if you obtain an extension showing zero balance due and they end up owing less than $1,000.00 when they file the return?

Just wondering.

[JohnH]

If you obtain an extension, they will avoid the 5% per month Failure To File penalty.

However, the client will owe interest on the unpaid balance at about 9% APR and a Failure to Pay penalty of .5% per month, which works out to about 1.25% per month (rounded) on the unpaid balance. I don't believe there would be an estimated tax penalty if the balance due is under $1,000.