IF YOU fail to file on time or pay on time, penalties kick in. Here are 10 reasonable causes to abate (forgive) penalties for late filing or late paying:
1. Tax returns were mailed on time. A return used to be considered filed on time if it is postmarked on or before the due date. Recent Development: You are now required to use certified mail for filing a return to prove that mailing was made on time.
2. Delay or failure to file was due to erroneous information supplied by an IRS employee.
3. Delay was caused by serious illness or death of the taxpayer or a member of your immediate family.
4. Delay was caused by your unavoidable absence.
5. Delay was caused by the destruction by fire or other casualty of your business records.
6. You were not able to determine the amount of tax due to reasons beyond your control.
7. You called the IRS for blank forms that did not arrive on time.
8. You personally visited an IRS office but were not attended to through no fault of your own.
9. You filed the return in the wrong district of the IRS and arrived at the right district after the deadline.
10. You relied on erroneous advice from the IRS.
And oh, you died.
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Victor Santos Sy, CPA, MBA, provides professional services in accounting and tax controversy including IRS audit defense and offers in compromise. He also advises clients on choices of entity including corporations for small businesses and LLCs for rentals. Vic worked with SyCip, Gorres, Velayo (SGV – Andersen Consulting) and Ernst & Young before establishing Sy Accountancy Corporation at 704 Mira Monte Place, Pasadena, CA 91101. The firm celebrates its 35th anniversary this year. You may email tax questions to Vic at [email protected]. You are welcome to visit our website for more than 300 tax tips at www.victorsycpa.com.
