A question for all about Form 1040

Technical topics regarding tax preparation.
#1
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Arlington, VA
Dear Pros, I hope you are well. We have had more people being non-responsive to get their 1040s done by 10/15 compared to previous years. We think it is because of Covid-19 and other personal matters relating to this. Has anyone had luck with reasonable cause because of Late penalties because of Covid-19 and it maybe effecting them or other family members? If so, do you have any type of wording to use on the letter to the IRS or state? Thank you for any insight
 

#2
CathysTaxes  
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Welcome to the Forum! If your clients don't owe, then no penalty. As far as the others, i haven't had any issues, the remaining outstanding client i have is an elderly couple and their son in law is trying to find their stuff and get online access to their IRS account.
Cathy
CathysTaxes
 

#3
mariaku  
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Oakland, CA
"If your clients don't owe, then no penalty" While this is true for Fed, states may differ - CA, for instance, penalizes non-filers who are owed refunds.
 

#4
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The IRS is so overloaded with penalty abatement requests that they seem to be denying all requests and sending them to appeals to deal with. You may have success in appeals but still will take a while to get to that point.
 

#5
Mbryson  
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Austin, TX
spencer768 wrote:The IRS is so overloaded with penalty abatement requests that they seem to be denying all requests and sending them to appeals to deal with. You may have success in appeals but still will take a while to get to that point.


How long are you experiencing? Sent in an appeal in June and haven't heard a peep.
 

#6
NYea  
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cdelsantos wrote: We have had more people being non-responsive to get their 1040s done by 10/15 compared to previous years. We think it is because of Covid-19 and other personal matters relating to this. Has anyone had luck with reasonable cause because of Late penalties because of Covid-19 and it maybe effecting them or other family members?


An abatement for reasonable cause basically depends on what a prudent person would do under all the facts and circumstances. I don't believe what you think is relevant.

You need to ask the taxpayer what occurred and then you can formulate an appropriate request. Given what you described as non-responsive perhaps they simply went elsewhere to have their return prepared.
 

#7
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22
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28-Sep-2021 8:45pm
Location:
USA
Mbryson wrote:
spencer768 wrote:The IRS is so overloaded with penalty abatement requests that they seem to be denying all requests and sending them to appeals to deal with. You may have success in appeals but still will take a while to get to that point.


How long are you experiencing? Sent in an appeal in June and haven't heard a peep.


Over the course of the year, have had maybe 5 sent to appeals, have heard from none so far.
 


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