IRS warns of new phone scam
The IRS has recently warned people to beware of a new scam linked to the Electronic Federal Tax Payment System
The IRS has recently warned people to beware of a new scam linked to the Electronic Federal Tax Payment System
If you recently filed your 2016 income tax return (rather than filing for an extension) you may now be wondering whether it’s likely that your business could be audited by the IRS based on your filing. Here’s what every business owner should know about the process.
New for the 2017 filing season, the employer deadline for Forms W-2 and 1099-MISC to be submitted to the IRS has changed. The new filing deadline is now the same as the due date for employers to issue these forms to recipients, January 31.
Last month, the IRS issued Notice 2016-66, which classifies a significant number of micro- captive arrangements as “Transactions of Interest.”
Under this Notice, these arrangements are now subject to detailed reporting obligations. In addition, captive insurance companies, insured parties and certain owners, and other involved parties and advisors (including captive managers) are required to meet certain disclosure and recordkeeping requirements.
By January 30, 2017, parties that have entered into these “Transactions of Interest,” potentially going back to 2006, will have to file a disclosure statement with the IRS detailing the circumstances surrounding their involvement in the captive arrangement. The disclosures will be utilized by the IRS for various purposes including potential guidance and enforcement.
Failure to file a complete and accurate disclosure statement can present a stiff penalty. Taxpayers will face a penalty of 75% of the decrease in tax as a result of the transaction, with a minimum penalty of $10,000 and a maximum penalty up to $50,000.
Captive managers and other advisors are subject to a $50,000 penalty for each failure to file and a penalty of $10,000 per day after the 20th day of not filing an information list requested by the IRS.
Given these stiff penalties, it is critical that those affected by this Notice pay close attention to the specific requirements imposed.
We hope this information has been helpful to you, and if you have questions about how this notice may affect you, please contact your Whalen & Company representative.
Sources:
https://whalencpa.wpengine.com/
614-396-4200
On March 20, the IRS issued guidance providing penalty relief to both individual and business taxpayers who file for an extension of their 2012 tax return and ultimately owe additional tax — but only if they meet certain criteria. First, the reason for filing for the extension must be that the taxpayer’s 2012 return involved forms whose publication was delayed because of the American Taxpayer Relief Act of 2012 (ATRA), signed into law Jan. 2. Here’s a sampling of the delayed forms:
In addition, the taxpayer must make a good faith effort when filing for the extension to properly estimate the tax liability. Then that estimated amount must be paid by the return’s original due date, and any additional tax owed must be paid by the return’s extended due date.
If you’re considering filing for an extension due to delayed IRS forms, please contact us to help ensure you’ll qualify for penalty relief.