Hey
The IRS announced it will be refunding the late filing penalties for “certain 2019 and 2020 returns.”
This refund will benefit about 1.6 million taxpayers (individuals, businesses, trusts, estates, etc.,) who filed their 2019 and 2020
returns late. The total amount to be refunded is expected to reach $1.2 billion.
Businesses hit with penalties for filing information returns late, e.g., banks, will also benefit.
The IRS says it understands the chaos that the pandemic caused, affecting these taxpayers. Hitting them with penalties seemed unfair, hence the refund.
The refund will benefit those who have already paid late filing penalties. They should receive the refund or a tax credit by the end of September 2022.
This is effectively a waiver on late filing penalties for the stated periods, which are usually 5% of your unpaid balance per month, capped at 25%.
However, Late payment penalties of 0.5% per month may still apply.
What should you do to access it?
If you are eligible for this refund, it will be automatically processed. You don’t have to do anything or call the IRS.
Eligible taxpayers must have filed an income tax return on or before September 30, 2022.
If you have any questions or if any tax issues are bothering you, contact my office at (202) 618-1297 to book an appointment with me. I will answer all your burning questions.
