What happens when you file your tax returns late?

Be it form 2290 or any other tax form, IRS considers late filing with an implied penalty. Here’s a 1985 case that I recently read which educates the importance of filing taxes on time and the danger of doing it late.

George’s mother Mary (names changed) died for some reason and had previously appointed her son as the executor of her will. George, involved in his business all the time, retained John (name changed again) as to serve as the attorney for the estate in his hands. John responsibly informed George about the federal estate tax return that he had to file but missed to mention the due date. The return was due within nine months of the decedent’s death as per law. Having the experience of only being the executor of the will and not any bit about federal estate taxation, he completely relied on John for instructions and guidance. He also provided John with all relevant information and records required for the return filing. George’s family was in constant touch with John and enquired about the proceedings of the return preparation while every time they were assured that everything would be done well before time. Apparently, John had overlooked the matter because of a clerical oversight in omitting the filing date from his calendar. After a brief meeting between the two, the return was finally filed, three months late.

By then, the IRS had assessed an additional tax of around $17, 000 as a penalty for the late filing, which was some 5% of the original tax amount. George paid the penalty and claimed a refund stating that the tax assessment was proper and that the penalty was unjustified because his failure to file the return on time was due to a reasonable cause that he relied on his attorney. When the case was brought to the Supreme Court, it said that George’s appeal is not excused by his reliance on an agent and that it is not a reasonable cause. It also clearly added that it requires no special effort on the taxpayer’s part to just know any deadline and ensure that it is met and so, George was left with the paid heavy penalty as such with no refund.

It is the duty of the taxpayer to know the deadlines even if he/she is assisted in filing by a tax professional because at the end of it all, the taxpayer is solely responsible for what’s on the papers. Fast approaching is the deadline for the federal heavy vehicle use tax (HVUT), August 31st 2012, for all heavy vehicle owners who put to use their existing or new carriers on public highways first in July for the tax year 2012-2013. We at Tax2290.com are here to assist you responsibly as e-tax professionals enabling easy online filing of your form 2290 and get your IRS stamped schedule 1 copy in hands within minutes. For any required assistance, reach our extended, warm and supportive hands at 866-245-3918 or support@taxexcise.com. File your form 2290 online with tax2290.com, pay your tax due amounts to the IRS and stay away from any penalties.


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