IRS penalties are completely aviodable when you know exactly what they are so you can plan ahead. The ExpressTaxFilings Team always wants to provide you with as much knowledge as possible on IRS penalties.
Stated in the General Instructions for Certain Information Returns, “the penalty applies if you fail to file timely, you fail to include all information required to be shown on a return, or you include incorrect information on a return.” If you paper file, and were required to file electronically, or you report an incorrect TIN, fail to report a TIN, or you fail to file paper forms that are machine readable, the penalty still applies.
The penalty amount is derived from when you file the correct information return.
- $30 per information return if you correctly file within 30 days of the deadline; maximum penalty $250,000 per year ( $75,000 for small businesses)
- $60 per information return if you correctly file more than 30 days after the due date but by August 1; maximum penalty $500,000 per year ( $200,000 for small businesses)
- $100 per information return if you file after August 1 or you do not file required information returns; maximum penalty $1,500,000 per year ( $500,000 for small businesses)
Now that you know what the penalties are, I am most certain you will avoid having to pay these penalties. Your 1099s and W-2s should already be out to recipients; that deadline was February 2nd. The deadline to have 1099s & W-2s e-filed is March 31st.
If you have any questions about e-filing your 1099s & W-2s for your contractors/employees contact our ExpressTaxFilings Support Team via phone: 803-514-5155 or email: firstname.lastname@example.org
Don’t forget, if you need more time to file personal, business, or exempt taxes, go to ExpressExtension.com
and file an extension that can extend your deadline 5 to 6 months.