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winktax, Enrolled Agent
Category: Tax
Satisfied Customers: 425
Experience:  18 years experience as an Enrolled Agent, insurance agent, stock broker and financial advisor.
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A clinet incorporated in 2010 and never filed any corp tax

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A clinet incorporated in 2010 and never filed any corp tax returns. He had no activity in the account until oct of 2011. Should a 2010 corp return be filed or can we start from 2011.

winktax :

Every Corporation must file regardless of the amount of income or loss. A corporation must continue to file until it is dissolved. - IRS Publication 542.

winktax :

Estimated payments are required if a corporation is expected to owe over $500 in tax.

winktax :

A 2010 Form 1120 should be filed.

winktax :

Minimum penalty for late filing: if a return is more than 60 days late is the lesser of $135 or 100% of the amount of tax required to be shown on the return.

winktax :

Penalties for late filing and late payment will not be imposed if the corporation can show the failure was due to reasonable cause. A statement explaining the reasonable cause must be attached to the tax return. For reasonable cause exceptions, see Section - Criteria for Relief from Penalties of the Internal Revenue Manual (www.IRS.Gov - search for Internal Revenue Manual)

winktax :

I find in first year failure to file situations the IRS will abate penalties if requested regardless of the reason provided, it seems to be a once in lifetime request for the entity involved.


Thank you very much

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