| I was meeting with a current client and an IRS | | | | learn on the fly how to file 941 quarterly returns, and |
| Revenue Officer in my office this afternoon and we | | | | how to make weekly tax deposits at the IRS. |
| were discussing his tax liability and the enormous | | | | Unfortunately, he did not make these payments or |
| amount of penalties and interest that his company | | | | filings on time, but rather sporadically, and the IRS |
| owes on top of the modest amount of tax that is due. | | | | doesn't really care the reason for the company not |
| Along the way we have attempted to have the | | | | making the payments or filings on time. |
| penalties abated, but the IRS concluded that his | | | | The Revenue Officer gave my client this advice, and |
| reasons for not paying the taxes when due did not | | | | this applies not only to business owners but also to |
| meet the "reasonable cause" qualification for allowing | | | | individual taxpayers as well: File your returns on time, |
| an abatement of penalties. | | | | whether you can pay or not. The non-filing penalty is |
| About five years ago an entire market sector (textiles) | | | | one penalty you can prevent all together and you |
| basically disintegrated in our area, leaving many people | | | | won't have to ask the IRS to abate at a later time. |
| without a job and many companies closing their doors. | | | | Then all you would have to worry about is the failure |
| My client's business served the textile industry heavily | | | | to pay penalty (and the failure to deposit penalty if you |
| and when they took a hit, so did my client's business. | | | | are a business owner not making the deposits for your |
| When the market turned down, so did my client's | | | | 941 taxes). |
| business and he was forced to lay many of his | | | | Short and sweet, but should save taxpayers a lot of |
| employees off - including his bookkeeper. So he had to | | | | money in penalties: File your returns no matter what. |