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A business can incur penalties and interest if it fails to pay debts on time. Most often, penalty and interest fees originate with a state or federal tax agency, and while they add to the total amount due, they are not part of the original bill. In cases where tax agencies assess multiple penalty and interest charges, there are strict requirements for the order in which you receive credit when sending in payment. The easiest way to enter and keep track of penalties and interest in QuickBooks is to create a new account for these charges and enter them as separate transactions.
