2011 Taxes: Late Filing Penalties For LLC, S Corp, And Partnership Returns
Posted by Tax Man - 26/04/11 at 03:04 pmThere is a whole lot of controversy in regards to the current spending habits of our Federal Administration. Because of the many bailouts and several other other causes, our nationwide debit is at a document high and getting greater every minute. This has caused the IRS to start looking for ways that they will acquire money, and they’re altering their practices to herald revenue. One major change we are seeing is that the IRS is taking a look at all of the laws that they have not been as “strict” on over the previous few years and finding ways to money in on them.
One of the ways in which the IRS is changing its practices is with late penalties for submitting data returns. An data return is one that is filed with the IRS but does not have a tax connected to it. Revenue tax returns for S Firms, LLC’s, and Partnerships are all data returns as a result of they’re circulate by means of entities and the taxes are paid by the homeowners of the entities on their private tax returns. So these returns simply report to or inform the IRS concerning the earnings and bills of the entity. Also included with info returns are the IRS’s copy of 1099 forms and W-2 forms. So if you do not file these on time the IRS will positive you.
Up to now if you filed an info return late, you could or could not have obtained a penalty. The enforcement of the late penalty was fairly inconsistent although the IRS guidelines provide for a penalty for late submitting, and till now, it hasn’t been strictly enforced. More often than not, we might merely write a letter and get the penalty waived. The IRS has noticed that this penalty has the potential to bring in millions of {dollars} of income so, they don’t seem to be only sending more letters for penalties for submitting late, but they’ve upped the penalty from $400 a month per owner to $one thousand a month per proprietor, and they don’t seem to be waiving the penalties.
So what does this imply to you in case you file a late entity return? For example you may have a LLC with 3 members and also you file your return 3 months late. You’ll now obtain a penalty of $9000. ($1000 x three Owners x 3 Months = $9000 Late Penalty) Type of makes you want to file on time - doesn’t it?
Remember that Corporation tax returns are due March fifteenth and LLC and Partnership returns are due April 18th this year. Should you need help in submitting an extension let your accountant know one week forward of the due date so that they’ll get confirmation that the extension was filed and accepted. With the IRS rising extra strict, they should have this documented proof of extensions and filings.
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