Which of the following statements regarding income tax penalties are true?

1. a penalty of 5% of the amount of tax not paid may apply for failure to file an income tax return by the due date d(including extensions)

2. a penalty of 0.5% of the unpaid taxes may apply for failure to pay the tax for each month after the due date that the tax is not paid.

3. a penalty of 20% of the underpayment of tax due may apply where the underpayment is due to negligence.

4. a penalty may apply for the substantial understatement of income tax on an income tax return.

Select one:

a. 2 and 3 only

b. 1 and 2 only

c. 1 and 3 only

d. 1, 2, 3, and 4