Tax professionals are intimately familiar with certain reporting requirements under the Internal Revenue Code. Indeed, a failure to properly and timely report a position on a return where it is otherwise required may result in significant penalties to a taxpayer.
One common failure-to-report penalty relates to so-called “listed transactions.” Generally, these transactions must be reported on an IRS Form 8886, Reportable Transaction Disclosure Statement. Any failure to report the transaction on a timely and properly filed Form 8886 can result in significant penalties—up to $200,000 per year. See I.R.C. § 6707A.
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