On August 24, 2022, the Internal Revenue Service issued an announcement providing a wide net of penalty relief to certain taxpayers who file the requisite forms by September 30, 2022. The text of the announcement, Notice 2022-36 (the “Notice,”) can be found HERE. This opportunity is potentially a valuable benefit in many circumstances.
The Notice provides a waiver of late filing penalties for returns for 2019 and 2020 tax years. Eligible returns include, but are not limited to, Form 1040 (individual), Form 1041 (estates and trusts), Form 5472 (information return of certain foreign owned US corporations), and Form 5471 (information returns of US persons with respect to certain foreign owned corporations.)
Note that the waiver of penalties is for late filing—not late payment. However, in some cases, the penalty for late filing alone can be exorbitant. Taxpayers should also be mindful of the fact that this relief also does not require a reasonable cause statement to file as other IRS penalty relief procedures require.
Please reach out to your Carter Ledyard contact or directly to Melinda Fellner firstname.lastname@example.org if you have any questions or would like to discuss your matter confidentially.
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Carter Ledyard & Milburn LLP uses Client Advisories to inform clients and other interested parties of noteworthy issues, decisions and legislation which may affect them or their businesses. A Client Advisory does not constitute legal advice or an opinion. This document was not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. © 2022 Carter Ledyard & Milburn LLP.