Penalties

Sec. 6708 Regs. Permit Material Advisers to Request Extension

The IRS issued proposed regulations governing the penalty for failure of material advisers to provide lists of advisees in reportable transactions, which applies if the advisers do not supply the lists to the IRS within 20 business days after a written request.

IRS Announces Abatements of Frivolous Filing Penalty

Taxpayers who have filed all required tax returns and paid all outstanding tax liabilities, including penalties (except for the Sec. 6702 penalty) and related interest, may qualify for a one-time reduction to $500 of any unpaid penalties that the IRS has assessed (Rev. Proc. 2012-43).

Rev. Proc. Updates Guidance on Adequate Disclosure of Return Positions

The IRS released its annual update identifying when a taxpayer’s disclosure of an item or position in an income tax return is adequate for purposes of reducing the understatement of tax penalty and the tax return preparer penalty for understatement due to unreasonable positions.

One-Time Abatement of $5,000 Frivolous Filing Penalty Announced

Taxpayers who have filed all required tax returns and paid all outstanding tax liabilities, including penalties (except for the Sec. 6702 penalty) and related interest, may qualify for a one-time reduction to $500 of any unpaid penalties that the IRS has assessed.

A Trust Fund Recovery Penalty Primer

This item discusses the basic mechanics of the trust fund recovery penalty, what qualifies someone as responsible for payroll taxes, and what constitutes willfulness.

Annual Update on Adequate Disclosure of Return Positions Issued

The IRS released updated guidance identifying when a taxpayer’s disclosure of an item or position in an income tax return is adequate for purposes of reducing the understatement of tax penalty and the tax return preparer penalty for understatement due to unreasonable positions.

IRS Gives Transitional Relief to Form 8937 Filers

The IRS announced that, due to its late release of the required form, it will not impose penalties on issuers of stock who report incorrect 2011 information required under Sec. 6045B, as long as they make a good-faith effort to timely comply with the requirements.

The Codified Economic Substance Doctrine and Related Penalties

The IRS issued a directive providing details on a multistep process that examiners must follow before the ultimate application of the economic substance doctrine in an examination. It also provides guidance on related penalties that might be imposed upon the application of the doctrine.

Newsletter Articles

SPONSORED REPORT

States look to unclaimed property for revenue

State audits of abandoned and unclaimed property (AUP) have exploded in recent years. This report outlines the escheat process, common types of AUP, how different states are handling it and how companies can plan for potential audits and liabilities.

DEDUCTIONS

Understanding the new Sec. 199A business income deduction

The new deduction allows certain business owners to keep pace with the significant corporate tax cut provided by the Tax Cuts and Jobs Act.