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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16576
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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I am a member of a condo home owners association. We filed

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I am a member of a condo home owners association. We filed the 1120-H tax return in 2007 and 2008. We have not filed since then. Is there any way to file previous years forms? Or, should we just begin again this year?

Megan C :

Hello! I am a CPA here to assist you with your tax questions. My goal is to provide you with excellent service today.

Megan C :

How are you today?

Megan C :

If you have not filed since 2008, you would need to become current on your tax filings by filing for years 2009-2012 and then remaining current by filing every year

Customer:

How would I become current? I can only find the form for this year.

Megan C :

OK let me search for the forms. They should exist for the prior years as well

Customer:

So, you're suggesting I submit a form for each year skipped? Is there a penalty for filing previous years?

Megan C :

Here's 2009: http://www.irs.gov/pub/irs-prior/f1120h--2009.pdf

Megan C :

Here's 2010: http://www.irs.gov/pub/irs-prior/f1120h--2010.pdf

Megan C :

and 2011: http://www.irs.gov/pub/irs-prior/f1120h--2011.pdf

Megan C :

No, there's no penalty for filing the return, but there is a penalty for not filing the return

Megan C :

By failing to file the 1120-H on time, you could lose the chance to use the 1120-H as your tax return, instead having to use form 1120 and paying tax on all your profits.

Megan C :

The failure to file penalty is 5% of the unpaid tax for each month or part of a month the return is late, up to a maximum of 25% of the unpaid tax. The minimum penalty for a return that is over 60 days late is the smaller of the tax due or $135. The penalty will not be imposed if the association can show that the failure to file on time was due to reasonable cause.

Customer:

can you also send 2008?

Megan C :

http://www.irs.gov/pub/irs-prior/f1120h--2008.pdf

Megan C :

There ya go!

Customer:

Thanks for your help. So, I should file each year's return? And, we don't normally owe tax, so I shouldn't expect to owe?

Megan C :

Well, the bad news is that you cannot file form 1120-H for years except for 2012 because you did not timely file

Megan C :

You will have to file form 1120.

Megan C :

Which is the corporate tax return

Megan C :

Since you have so many years of back taxes, the tax situation is rather complex and I would suggest that the treasurer of the homeowner's association work with a tax professional that specializes in this field of accounting.

Customer:

Can you recommend anyone in Boston?

Megan C :

Unfortunately, we cannot make recommendations but you could contact the Massachusetts board of accountancy to find a licensed CPA in your area. Just when you call ask them if they work with homeowners associations

Customer:

Is there a way I can just submit this year's form?

Megan C :

The problem is, that I think that for 2012 you are too late as well, if you did not file an extension

Customer:

No, I did not file an extension

Megan C :

If you are late in filing your return past the natural 3 1/2 months timeframe or an additional 6 months for an extension plus 12 months for the automatic extension you will be required to file a Form 1120 and may not elect to file a Form 1120-H.

Customer:

It looks like our last filing was dated Sept 1 2007- Aug 31 2008.

Customer:

it was signed 11/17/08.

Customer:

So, do you think I could file the 2012 form from Sept 1 2012- Aug 31 2013?

Megan C :

Yes, that would work, because it is still within three months of the filing. I was assuming you were on a calendar year

Customer:

OK, good, so I could go ahead and file the 2012 form. Would that trigger any kind of audit on previous years?

Megan C :

I can't say with certainty, but it is possible that they will notice the lapse and start asking for tax returns.

Megan C :

that is why I would hire a professional to help you with this.

Customer:

That makes sense. You think a CPA with experience with home owners associations would be our best option?

Megan C :

Yes

Customer:

And, just clarify, you don't think I can submit the previous years 1120-H forms? Only the 2012 form? (Sorry, I need the repetition).

Megan C :

No, I do not believe you will be able to submit a form 1120-H for the prior years, I believe you will have to file a regular 1120.

Megan C :

That's fine, I don't mind repeating :-)

Customer:

One last question, do you think I should go ahead and file the 1120H form for this year right away? Or, should I contact a CPA first and hope for a quick meeting to receive guidance on the entire situation?

Megan C :

I would get guidance on the whole situation, but if it takes longer than 3 weeks to get in, I would just go ahead and file.

Customer:

Good. Thank you for your time and advice.

Megan C :

You're welcome. I wish you the best of luck. If you would, please don't forget to rate my response as "Excellent" so that I may receive credit for assisting you today

Customer:

Definitely.

Megan C and other Tax Specialists are ready to help you
Thanks, Angela for your positive rating. Please come back and see me any time you have a question that needs answered. It was a pleasure working with you today.

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