IRS Filing Penalties for the 2016 Tax Year

Well, everyone, today’s the last day for paper filers to have 1099 Forms and ACA Forms postmarked and mailed (remember all W-2 Forms were due back in January)!

If you’d planned to paper file and are nowhere near ready to today, you do still have a few options.

For starters, you could e-file instead! There’s no need to alert the IRS that you’re e-filing in lieu of paper filing, and it gives you an extra month to get things in line since the e-filing deadline isn’t until March 31. Plus, the IRS seriously recommends everyone e-file anyway because it’s more secure, faster, and leaves less room for error.


You can also get everything together as quickly as you can to try to file on time. Just keep in mind that if your ACA or 1099 return is paper filed and postmarked after today, February 28, 2017, you could be held liable for the IRS filing penalties you may incur. And this year, they’ve gone up:


For Large Businesses (Gross Receipts > $5 Million, Governmental Entities)
Time Returns Filed Penalty for Returns due 01-01-2017 through 12-31-2017
No more than 30 days late (by March 30 if the due date is February 28) $50 per return, $532,000 maximum per calendar year
31 days late – August 1 $100 per return, $1,596,500 maximum per calendar year
After August 1 or not at all $260 per return, $3,193,000 maximum per calendar year
Intentional disregard to file $530 per return, no maximum limitation per calendar year


For Small Businesses (Gross Receipts < $5 Million)
Time Returns Filed Penalty for Returns due 01-01-2017 through 12-31-2017
No more than 30 days late (by March 30 if the due date is February 28) $50 per return, $186,000 maximum per calendar year
31 days late – August 1 $100 per return, $532,000 maximum per calendar year
After August 1 or not at all $260 per return, $1,064,000 maximum per calendar year
Intentional disregard to file $530 per return, no maximum limitation per calendar year




These penalties apply for the forms you’re sending to the IRS as well as the ones sent to your recipients. For 1099 filers, the recipient deadline was January 31, so if you haven’t gotten those out, you’ll need to as soon as possible. ACA recipient forms aren’t due out until March 2 (the day after tomorrow), so you still have a couple of days on those.

They also apply for the e-filing deadline. So, instead of having a month after February 28 for the first tier of penalties like paper filers, e-filers have a month after March 31 and so on if filing late.

Again, we highly recommend looking into the e-filing option – especially the e-filing with ExpressTaxFilings option. Unlike when you paper file, when you e-file with ExpressTaxFilings, you have another set of eyes to look back over your forms (well, an automated computer system that authorizes IRS-rule-based error checks) before you transmit.

Check out our site or give us a call to learn more about how you can make the switch to e-filing!

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