IRC 6662 Percent Pentalty
NewKidinTown3 … or anyone else
A few years ago my brother told me the IRS has a rule where if you overpay them during the year more than $500 they only have to refund you $500. So for example you over pay them during the year $800 then they only have to give you $500 back and you loose the extra $300. I don’t know about this. Does anyone know if this is true or not?
The reason I bring this up is because my niece was audited and they sent her some forms to fill out. One of the forms titled “Accuracy-Related Penalties under IRC 6662†eluded to her having to pay a penalty for underpayment OR overpayment. I can see having a penalty for underpayment but not for overpayment to them.
Some wording from 2 paragraphs from the form sent to her
.
20 Percent Penalty - Internal Revenue Code Section 6662(a)
It has been determined that the underpayment of tax shown on line 7 below is attributable to one or more of the following:
(1) Negligence or disregard of rules or regulations;
(2) Substantial understatement of income tax;
(3) Substantial valuation misstatement (overstatement).
Therefore, an addition to tax is imposed as provided by Section 6662(a) of the Internal Revenue Code
40 Percent Penalty - Internal Revenue Code Section 6662(h)
It has been determined that the underpayment of tax shown on line 7 below is attributable to a gross valuation misstatement (overstatement). Therefore, an addition to tax is imposed as provided by Section 6662(h) of the Internal Revenue Code.
Her tax should have been ~ $169 but using one of these percent Penalty’s they were charging her $1157.00
Seems a long way from $167 to $1157.00
Anyone have any input about the Percent penalty charges – either section 6662(a) or Section 6662(h)
On the bottom of the form is “RSG Version 12.20.00
null
Comments(0)