Welcome Guest. Register Now!  

LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 07-06-2008, 06:20 PM
Junior Member
Join Date: Jul 2008
Posts: 1
Question about IRS penalty accessment

In 2006 our 20 year old live at home daughter filled her own taxes and claimed herself as a deduction(she didn't know better, first time doing it herself) so when we filed online for ours it was rejected. We have a very good income with very few itemizations, simple and straight forward and we were fully paid in for the year with exception of oweing approx $500.00. We sent our daughters ammendment in about 6 weeks ago and are awaiting verification by the IRS so we can refile for 2006. In the meantime we got a letter from the IRS giving us 30 days to file and accessing MAJOR penalties, not just on what we owe for the year(500.00) but on the entire paid in amount. My question is this....... if we were paid up(taxes taken out of paycheck every month) on our 2006 taxes with the exception of oweing 500.00(according to our return) can the irs fine us based on the total amount for the entire year or should we be assessed fines and penalties based on what we owed as of April 15,2007. We are freaked out by what they are saying we owe in penalties. I might also add that we filed for 2007 and are actually owed a 5300.00 refund (which we dont expect to see) The Irs is saying we owe 31,000.00 in penalties based on an estimated return that they sent us. Based on our previous years of filing. But the amount is based on the total paid in for the year. How can that be if they have had our money all along, on schedule with the exception of the 500.00. Would appreciate any help on what we might be able to expect in the matter.

Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 07-14-2008, 12:00 PM
TaxGuru's Avatar
Tax Guru
Join Date: Jan 2007
Location: New Jersey, USA
Posts: 2,413
Blog Entries: 3
Let me understand your situation fully! Your daugther filed her 2006 tax return herself and then you tried to file a 2006 Tax return online and it was rejected! Since then, how did you file the 2006 tax return? Did you include her as a dependent on the paper filed tax return?

You paid taxes on your bi-weekly pay check and the only way you would have owed federal taxes is if you your combined household income results in the imposition of AMT taxes, or your federal withholding was very low based on your W-4.

Please clarify the above and then I will be in a better position to answer your question.

Find a CPA near you!

Ask TaxGuru Please refer to the legal disclaimer.

Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Roth IRA – Withdrawal and Penalty lwebinc IRA/Sep 1 07-14-2008 12:22 PM
Frivolous Tax Submissions Penalty increased substantially for 2007 TaxGuru General 0 02-13-2008 10:47 AM
What is the penalty for failure to file Tax-Exempt Organization tax return? TaxGuru Non-Profit Organisation 0 01-09-2008 06:37 PM
Can the IRS abate the late filing penalty for an LLC or Partnership? TaxGuru Limited Liability Company 0 12-13-2007 06:26 PM
How one can avoid the 10% penalty for early withdrawal of funds from an IRA? gimini IRA/Sep 2 04-08-2007 11:36 PM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 » Income
 » IRA/Sep
 » Medical
 » Payroll
Forum for CPAs
Financial Planning

» Recent Tax Q&A