26Title 26The US tax code, read & explained

26 U.S.C. § 6695

§ 6695. Other assessable penalties with respect to the preparation of tax returns for other persons

812 words · amended 11 times

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No plain-English explainer yet. Below is the official text. Explainers are being added section by section.

History

Added in 1976 by the Tax Reform Act of 1976. Last changed March 23, 2018 by the Consolidated Appropriations Act, 2018.

Every change, newest first (12)
  1. March 23, 2018Consolidated Appropriations Act, 2018
  2. December 22, 2017Tax Cuts and Jobs Act (2017)
  3. December 18, 2015Consolidated Appropriations Act, 2016 (PATH Act)
  4. December 19, 2014Tax Increase Prevention Act of 2014
  5. October 21, 2011Public Law 112-41
  6. May 25, 2007Public Law 110-28
  7. August 5, 1997Taxpayer Relief Act of 1997
  8. December 19, 1989Omnibus Budget Reconciliation Act of 1989
  9. May 24, 1985Public Law 99-44
  10. July 18, 1984Deficit Reduction Act of 1984
  11. November 6, 1978Revenue Act of 1978
  12. October 4, 1976Tax Reform Act of 1976 · added this section

The law as written

Current through Public Law 119-102. Amendment notes omitted.

Structure

  1. (a) Failure to furnish copy to taxpayer
  2. (b) Failure to sign return
  3. (c) Failure to furnish identifying number
  4. (d) Failure to retain copy or list
  5. (e) Failure to file correct information returns
  6. (f) Negotiation of check
  7. (g) Failure to be diligent in determining eligibility for certain tax benefits
  8. (h) Adjustment for inflation
(a) Failure to furnish copy to taxpayer

Any person who is a tax return preparer with respect to any return or claim for refund who fails to comply with section 6107(a) with respect to such return or claim shall pay a penalty of $50 for such failure, unless it is shown that such failure is due to reasonable cause and not due to willful neglect. The maximum penalty imposed under this subsection on any person with respect to documents filed during any calendar year shall not exceed $25,000.

(b) Failure to sign return

Any person who is a tax return preparer with respect to any return or claim for refund, who is required by regulations prescribed by the Secretary to sign such return or claim, and who fails to comply with such regulations with respect to such return or claim shall pay a penalty of $50 for such failure, unless it is shown that such failure is due to reasonable cause and not due to willful neglect. The maximum penalty imposed under this subsection on any person with respect to documents filed during any calendar year shall not exceed $25,000.

(c) Failure to furnish identifying number

Any person who is a tax return preparer with respect to any return or claim for refund and who fails to comply with section 6109(a)(4) with respect to such return or claim shall pay a penalty of $50 for such failure, unless it is shown that such failure is due to reasonable cause and not due to willful neglect. The maximum penalty imposed under this subsection on any person with respect to documents filed during any calendar year shall not exceed $25,000.

(d) Failure to retain copy or list

Any person who is a tax return preparer with respect to any return or claim for refund who fails to comply with section 6107(b) with respect to such return or claim shall pay a penalty of $50 for each such failure, unless it is shown that such failure is due to reasonable cause and not due to willful neglect. The maximum penalty imposed under this subsection on any person with respect to any return period shall not exceed $25,000.

(e) Failure to file correct information returns

Any person required to make a return under section 6060 who fails to comply with the requirements of such section shall pay a penalty of $50 for—

(1)

each failure to file a return as required under such section, and

(2)

each failure to set forth an item in the return as required under section,

unless it is shown that such failure is due to reasonable cause and not due to willful neglect. The maximum penalty imposed under this subsection on any person with respect to any return period shall not exceed $25,000.

(f) Negotiation of check

Any person who is a tax return preparer who endorses or otherwise negotiates (directly or through an agent) any check made in respect of the taxes imposed by this title which is issued to a taxpayer (other than the tax return preparer) shall pay a penalty of $500 with respect to each such check. The preceding sentence shall not apply with respect to the deposit by a bank (within the meaning of section 581) of the full amount of the check in the taxpayer’s account in such bank for the benefit of the taxpayer.

(g) Failure to be diligent in determining eligibility for certain tax benefits

Any person who is a tax return preparer with respect to any return or claim for refund who fails to comply with due diligence requirements imposed by the Secretary by regulations with respect to determining—

(1)

eligibility to file as a head of household (as defined in section 2(b)) on the return, or

(2)

eligibility for, or the amount of, the credit allowable by section 24, 25A(a)(1), or 32,

shall pay a penalty of $500 for each such failure.

(h) Adjustment for inflation
(1) In general

In the case of any failure relating to a return or claim for refund filed in a calendar year beginning after 2014, each of the dollar amounts under subsections (a), (b), (c), (d), (e), (f), and (g) shall be increased by an amount equal to such dollar amount multiplied by the cost-of-living adjustment determined under section 1(f)(3) for the calendar year determined by substituting “calendar year 2013” for “calendar year 2016” in subparagraph (A)(ii) thereof.

(2) Rounding

If any amount adjusted under paragraph (1)—

(A)

is not less than $5,000 and is not a multiple of $500, such amount shall be rounded to the next lowest multiple of $500, and

(B)

is not described in subparagraph (A) and is not a multiple of $5, such amount shall be rounded to the next lowest multiple of $5.