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Tax.appeal.168
Tax.appeal.168, Tax Accountant
Category: Tax
Satisfied Customers: 3444
Experience:  3+ decades of varied tax industry exp. Tax Biz owner
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What is the tax penalty a partnership return without

Customer Question

what is the tax penalty for filing a partnership return without the social security number of the partner (who refuses to turnover his number)
Submitted: 1 year ago.
Category: Tax
Expert:  Tax.appeal.168 replied 1 year ago.
Welcome. Thank you for choosing us to assist you. My name is ***** ***** my goal is to help make your life, a little... less taxing.
Q: what is the tax penalty for filing a partnership return without the social security number of the partner (who refuses to turnover his number)
A: SEE BELOW:
Failure To Furnish Information
Timely
For each failure to furnish Schedule K-1 to a
partner when due and each failure to include
on Schedule K-1 all the information required
to be shown (or the inclusion of incorrect
information), a $100 penalty may be
imposed for each Schedule K-1 for which a
failure occurs. The maximum penalty is $1.5
million for all such failures during a calendar
year. If the requirement to report correct
information is intentionally disregarded, each
$100 penalty is increased to $250 or, if
greater, 10% of the aggregate amount of
items required to be reported, and the $1.5
million maximum does not apply.
REFERENCE SOURCE:
http://www.irs.gov/pub/irs-pdf/i1065.pdf
Page 5
Let me know if you require further assistance with this matter.
Customer: replied 1 year ago.
I appreciate your response. I would just like to clarify the portion of the sentence that reflects 10%of the aggregate amount of items required to be reported.... do you think or how would this apply to a partner refusing to turnover his social security number in order to complete a k-1? My other question would be under these circumstances do you think the IRS would impose a penalty in excess of $250 considering this isn't the first or second year of non compliance by the partner? Thank you.
Expert:  Tax.appeal.168 replied 1 year ago.
Hello again,
Sorry for the delayed response. I was away from the computer.
Q1: I would just like to clarify the portion of the sentence that reflects 10%of the aggregate amount of items required to be reported.... do you think or how would this apply to a partner refusing to turnover his social security number in order to complete a k-1?
A1: In my opinion, no. If the partner is refusing to provide his social, my suggestion would be to complete the Schedule K-1 for him anyway. In the space for the social security number, simply write partner refused to provide. Submit all the necessary information the IRS.
A2: Again, no. What you can do is to mail the person a certified, return receipt letter requesting his social security number. Make a copy of the letter, and hold on to the green receipt card when it is returned. If the person still refuses to provide their social security number, attach a copy of the letter and the return receipt card to the return and write a note explaining that the partner refuses to provide social security number. The IRS should handle it from there.