Small Business Taxes & ManagementTM--Copyright 2013, A/N Group, Inc.
The IRS has announced that it is providing late-payment penalty relief to individuals and businesses requesting a tax-filing extension because they are attaching to their returns any of the forms that couldn’t be filed until after January (see list below).
The relief applies to the late-payment penalty, normally 0.5 percent per month, charged on tax payments made after the regular filing deadline. This relief applies to any of the forms delayed until February or March, primarily due to the January enactment of the American Taxpayer Relief Act.
Taxpayers using forms claiming such tax benefits as depreciation deductions and a variety of business credits qualify for this relief. Included in the list of forms are 5695, Residential Energy Credit, 5884, Work Opportunity Credit, 8582, Passive Activity Loss Limitation, and 8863 Education Credits.
Individuals and businesses qualify for this relief if they properly request an extension to file their 2012 returns. Eligible taxpayers need not make any special notation on their extension request, but as usual, they must properly estimate their expected tax liability and pay the estimated amount by the original due date of the return.
The return must be filed and payment for any additional amount due must be made by the extended due date. Interest still applies to any tax payment made after the original deadline.
The IRS will abate any section 6651(a)(2) additions to tax assessed with respect to these 2012 income tax returns. When responding to the assessment notice, a taxpayer should submit a letter describing the taxpayer’s eligibility for this relief, identifying which of the form(s) listed in Exhibit 1 (see below) of Notice 2013-24 was included with the taxpayer’s return as filed, and referencing this Notice by number (Notice 2013-24) to the address listed in the assessment notice.
Additional details, including instructions for responding to penalty notices, is available in Notice 2013-24.
Forms affected:
Copyright 2013 by A/N Group, Inc. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Articles in this publication are not intended to be used, and cannot be used, for the purpose of avoiding accuracy-related penalties that may be imposed on a taxpayer. The information is not necessarily a complete summary of all materials on the subject. Copyright is not claimed on material from U.S. Government sources.--ISSN 1089-1536
--Last Update 03/20/13