Discussion:1065 Penalty

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Discussion Forum Index --> Basic Tax Questions --> 1065 Penalty

Discussion Forum Index --> Tax Questions --> 1065 Penalty

Alpha1 (talk|edits) said:

13 February 2008
Client received penalty for late filing of 06 1065 return, IRS issued

CP162 notice with penalty assessment. Has anyone had any luck with getting penalty remove with letter to IRS.

Taocpa (talk|edits) said:

13 February 2008
How many partners?


Alpha1 (talk|edits) said:

13 February 2008
3 partners, penalty=750

each partner timely filed their respective 1040, just 1 partner forgot to file the 1065 returns

Taocpa (talk|edits) said:

13 February 2008
Try Rev Proc 84-35. It deals with this issue of small partnerships with less than 10 partners. Here is wording I use in my letters:

This partnership qualifies as a small partnership and all of the income, deductions and credits were reported on the individual partner’s timely-filed returns. The partnership is composed of ### individuals. The partners are:

          Partner's Name                  Partner's SS#

In accordance with Rev. Proc. 84-35, there should be no penalty assessed to the partnership. Accordingly, we request relief from the penalty imposed by Internal Revenue Code Section 6698 (A) (1).''


Alpha1 (talk|edits) said:

13 February 2008
thank-you- Tom

Death&Taxes (talk|edits) said:

13 February 2008
Get a POA and try Practitioner Hotline; last week they forgave five years worth on a 2 person husband-wife partnership on the telephone.

Lukepccpa (talk|edits) said:

2 May 2008
I've got a partnership late filing issue with a twist.

I filed #1 partner's 1040 on March 1st without any partnership information (because I didn't have any) as they were a qualified farmer and needed to file/pay by March 1st. I knew the partnership was going to show a small loss, so told the client I would amend their 1040 for the K-1 once the partnership return was done.

I filed an extension on the #2 partner's 1040, and filed an extension on the partnership return (or so I thought). I finished up the partnership return, the amended 1040 for partner #1, and the 1040 for partner #2 today. However, I can't find a copy of the partnership extension anywhere in our office or our extension control file, although it was on our list of extensions to prepare. I have a sinking feeling the partnership extension didn't get filed.

I'm aware of the late filing exception for small partnerships. However, since I had already filed partner #1's return with no partership info on it, I think I'm stuck. And I don't think the fact that the partnership showed a loss and the amended return claims a refund makes any difference.

Any ideas?

For a little background, partner #2 had a sole proprietorship and then brought in partner #1 in the middle of the year and formed a partnership. The partnership books, while on pretty green ledger paper, were little better than a shoebox return. Also, partner #2 was either counting partnership expenses as sole proprietor expenses, or counting the same expenses on both the sole proprietorship books and the partnership books. We extended the returns to have time to sort out the sole proprietorship and the partnership activity. Under partner #2's bookkeeping method, partner #1 was getting stuck with all income and few expenses.

Mscash (talk|edits) said:

3 May 2008
Follow Revenue Procedures 81-11. For a general partnership with less than 10 partners, if the partners have reported their distributive share of income on their 1040s, the penalty can be wavied.


Davidfreeley (talk|edits) said:

27 June 2012

I filed for a client (S Corp). They had given me the wrong company name so the forms were incorrect. The IRS send a CP162 asking for the 'wrong company' to submit the K1's I resubmitted them last week. Should I wait to see if they waive the penalty or should I call the hotline Thanks

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