New Penalties This Year For Late Returns

If you’ve got a partnership or S Corporation return and haven’t yet filed your return for 2009, pay attention to today’s blog!

These returns are due 9/15, not 10/15 as some have been in the past.

Here’s how it works:

If you have a corporation with a 12/31/09 year end, your return will be due 3/15, or 2 ½ months after the year-end. You can file a Form 7004 and request an extension for 6 months, which takes you until 9/15/10.

If you have an LLC with multiple partners that has been disregarded for income tax purposes, a partnership or a joint venture, then your 12/31/09 tax return was due 4/15. You hopefully filed a Form 7004 which gave you an extension for 5 months. That takes you until 9/15/10 as well.

If you’re late, or failed to file the extension, there are some newly increased penalties that you’ll get hit with.

For the S Corporation, it’s $195/month for each month or partial month and per shareholder. So, if you’re late one month and there are two shareholders, it will be $390.

For the partnership, it’s $89/month for each month or partial month and per shareholder. So, if you’re late one month and have 10 partners, it will be $890.

If you’ve missed filing for a number of years, now is the time to come clean. Otherwise, the IRS may file a substitute return for you, disallowing deductions and then start the lien process against your assets. This is DEFINITELY something you want to avoid! Get a good CPA or tax attorney working with you right away. Give Richard a call at 866.829.2368 extension 1 to see how we can help.