OUR THOUGHTS ON:

IRS Announces Erroneous Failure-to-Deposit Penalties Will Be Resolved

Tax

By Jim Gilboy

This spring’s tax season was extended to April 18 because of a holiday (Emancipation Day) in the District of Columbia. While many of us believed that a few extra days to file tax returns past the normal April 15 annual deadline was a good thing, it appears that the Internal Revenue Service (IRS) has run into some difficulties related to the change in date.

The IRS announced that some payroll tax deposits made after April 15, but before April 19, were treated as being late because of a programming error within the IRS’ system.  The IRS’ processing system did not recognize that the due date for a timely deposit had been changed to April 18. As a result, some depositors were assessed failure-to-deposit penalties, which apply if a taxpayer does not deposit tax in the correct amount or on time.

Affected taxpayers do not need to contact the IRS or take any action at this time. The IRS is taking steps to correct these errant penalties, and any taxpayers impacted will be contacted when the penalty assessment issue is resolved.    

Contact us if you have qiuestions regarding any failure-to-deposit issues and visit the Our Thoughts On blog for timely tax articles

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