Sigma Tax Pro Reports New IRS Penalty Relief For Small Business Retirement Plans
The Internal Revenue Service recently announced it will pilot a one year program to help small businesses who owe penalties for their retirement plans.
Many small businesses have been saddled with penalties for not filing reporting documents pertaining to their retirement plans. The Internal Revenue Service announced this week that it will begin a pilot program to help small businesses in this position. During this pilot one-year period small businesses will be able to file current and prior year forms to avoid penalties. The details of the program can be found on the IRS website at Revenue Procedure 2014-32.
The penalties that small businesses can face in this situation can be up to $15,000 per return. Moreover, many businesses were unaware that this filing requirement even existed. The Internal Revenue Service hopes that the new program will allow good intentioned businesses to come into compliance with the filing requirements. Pension plan administrators must file an annual Form 5500, however this program is only available to certain small businesses such as owner-spouse arrangements.
In an attempt to simplify the process for business owners and retirement plan administrators, multiple plan returns will be allowable in a single submission. Furthermore, if returns are delinquent for more than one year, relief may still be granted and there will be no filing fee during the first year pilot phase.
Sigma Tax Pro provides a full range of essential services for tax professionals. This includes industry leading software solutions as well as technical support, tax preparation support and client retention strategies. Sigma Tax Pro specializes in helping tax preparation firms expand their businesses, open new offices and increase their client base. Clients can already renew their software licenses for next year’s tax season and ensure the lowest pricing available in the industry.
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Tax Preparers Claim Final Victory Over IRS in Licensing Plan, Announces Sigma Tax Pro
The conclusion to a case that has taken over two years was finally reached as the IRS declined to file a petition to the Supreme Court.
The case that began in 2012 when three tax preparers decided to take on the IRS reached its conclusion this month when the IRS did not exercise its option to seek a review of the case by the Supreme Court. Now that the deadline has passed, the issue can finally be put to rest and tax preparers around the country can breathe a sigh of relief. The IRS will not be able to require independent tax preparers to go through a licensing program which many within the industry perceived to be onerous.
The background to the case is interesting; the IRS proposed that it had the authority to regulate tax preparers under the “Horse Act” of 1884. This statute was created to regulate compensation claims for dead horses brought by civil war veterans but was used as a means to put forward licensing requirements for tax preparers in the 21st century. The three tax preparers who took on the IRS —Sabina Loving of Chicago, Ill., Elmer Kilian of Eagle, Wis., and John Gambino of Hoboken, N.J., argued that the IRS could not use this 19th century legislation without the approval of Congress.
The proposed licensing would have affected hundreds of thousands of tax preparers across the United States and it was argued that it would have benefited special interests over independent tax preparation offices. Ultimately, the IRS did not obtain congressional approval and declined their opportunity to take the case to the Supreme Court.
Sigma Tax Pro provides a full range of essential services for independent tax preparers. This includes industry leading software solutions as well as technical support, tax preparation support and client retention strategies. Sigma Tax Pro specializes in helping tax preparation firms expand their businesses, open new offices and increase their client base. Clients can already renew their tax software licenses for next year’s tax season and ensure the lowest pricing available in the industry.
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