Inflation-Adjusted Penalties Released for 2015 by IRS

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The inflation-adjusted amounts of some penalties for failing to properly comply with certain aspects of tax compliance were released Feb. 5 during an Internal Revenue Service teleconference call for the payroll industry.

Penalties for violating sections of the Internal Revenue Code became subject to annual adjustments for inflation under Section 208 of Division B of the Tax Increase Prevention Act of 2014 (H.R. 5771, Pub. L. 113-295), signed Dec. 19 by President Barack Obama. Computations of the inflation-adjusted amounts for 2015 were completed Feb. 4.

For 2015, the penalty amount under I.R.C. Section 6721, Failure to File Correct Information Returns, and Section 6722, Failure to Furnish Correct Payee Statement, for intentional disregard of filing requirements increased to $260 for each form from $250.

The tier of penalties associated with Sections 6721 and 6722, including penalty amounts of $30, $60 or $100 per form, that can be assessed when there was no intentional disregard for filing requirements but that increase with lateness in correcting noncompliance are to not be adjusted for inflation.

The penalty for a third-party administrator for failing to comply with due diligence requirements regarding the earned income credit is $505 per failure for 2015, up from $500 for 2014.

The 2015 maximum total penalty for certain tax-exempt organizations for failing to file required disclosures under Section 6652, Failure to File Certain Information Returns, Registration Statements, Etc., is $50,500, up from $50,000.

Other topics discussed during the teleconference included:

•The ZIP code for Philadelphia on the filing instructions for the 2014 Form 8922, Third-Party Sick Pay Recap, was incorrect, the IRS said. The correct ZIP code is 19255-0533. The revised form is at

•The 2015 Form 941, Employer's Quarterly Federal Tax Return, is to be released later in February. Filers that submitted more than 5,000 payroll tax returns in 2014 are to be required to file forms of the Form 94x-series (940, 941, 943, 944 and 945) with the Modernized e-File program starting in July. Bulk and batch filers are to be required to file such forms with the Modernized e-File program starting in October.

To contact the reporter on this story: Howard Perlman in Washington at

To contact the editor on this story: Michael Trimarchi in Washington at