Penalty Relief: IRS Notice 2022-36
The IRS has announced broad-based penalty relief for certain 2019 and 2020 returns due to the COVID-19 pandemic.
The penalty relief will be automatic for people and businesses who qualify. Relief applies specifically to the failure to file penalty. This penalty is typically assessed at a rate of 5% per month and up to 25% of the unpaid tax when a federal income tax return is filed late.
This relief applies to returns in both the Form 1040 and Form 1120 series, as well as others listed in the notice. To qualify, any eligible income tax return must be filed on or before 9/30/22.
Relief is also available for various information returns, such as those in the Form 1099 series. The IRS Notice 2022-36 also provides details on relief for filers of various international information returns.
Penalties that have already been assessed will be abated. If already paid, the taxpayer will receive a credit or refund.