$10,000 Penalty

[MTR]

Hi All

Got a letter today from Internal Revenue Service (IRS), $10,000 penalty for failure to provide Form 5472 This is a tax return, amount due in 10 days.

I promptly phoned my accountant in Oz as last year he prepared paper work for extension of due date of tax returns. However, one of my LLC names was incorrect therefore this did not get processed, in other words no extension on file for this LLC. (Limited Liability Company).

What my accountant advised was that in US totally different from Oz, they are ruthless, "you pay up first and then we talk later" and then we see who is right, they will even consider foreclosing on your home.

Accountant has now sent letter to IRS with evidence etc and explaining what has happened and believes this will be resolved. Just a warning for anyone with US properties, it aint Oz and you don't get a slap across the hand.

MTR

 

[Ausprop]

wow that's an interesting one

 

[Scott No Mates]

Are you sure that it isn't some Nigerian scam?

 

[Terry_w]

You are probably on the anti terrorism watch list now and have all your communications monitored by the NSA.

 

[MTR]

Are you sure that it isn't some Nigerian scam?

LOL, no scam.

Apparently accountant advised that a few of his clients have received these letters, they are stock standard for anyone who does not comply, just have to go through the process and explain what happened etc at a cost of $200 accounting fees

 

[Amadio]

We have just come out on the right side of an IRS battle lasting nearly 3 years. It was very scary watching the interest and penalty rate climb on the amount they claimed I owed.

You are absolutely right - they send the bill first and the fight is on. Guilty first - prove your innocence.

You need to hold documents forever - had I not been married to a packrat who brought 7 boxes of 20 year old documents to Australia when we moved, we would never have been able to disprove their claim.

 

[Andrew_A]

Got a dispute with the ATO at the moment from a few years ago, same principle, guilty until proven innocent, found them generally very good to deal with though.

 

[MTR]

Got a dispute with the ATO at the moment from a few years ago, same principle, guilty until proven innocent, found them generally very good to deal with though.

From what I can gather ATO is "a walk in the park" compared to IRS, I know someone who has had to pay penalties of $700 for being late, in Oz we get warnings etc.

 

[jclegg]

I was overseas for a few years and the first year back in Oz we bought our house and spent every cent we had . Come tax time we knew we would have a bill so we kind of forgot to lodge the return . the following year we went to our accountant and explained and he lodged both years together. We got a huge fine for not lodging and paying the previous year but we couldn't really fight it as we had done it

 

[MRO]

From what I can gather ATO is "a walk in the park" compared to IRS, I know someone who has had to pay penalties of $700 for being late, in Oz we get warnings etc.

Not always. The ATO is pretty strict on fines now. One warning and the next year you are almost guaranteed a fine. $550 for individuals last time I checked. The ATO used to be a lot more lenient but times have changed.