Penalties for Form 1120-POL

Late Filing of Tax Return:

A political organization will be charged a penalty of 5% of the unpaid tax for each month or part of a month that the return is late, with a maximum penalty of 25% of the unpaid pax.

Note: The minimum penalty for returns that are more 60 days late is the smaller amount of the tax due or $135.

Late Payment of Tax:

An organization that fails to pay taxes that are due will be charged a penalty of half of 1% of the unpaid tax for each month or part of a month in which the tax is not paid, with a maximum of 25% of the unpaid tax.

Note: A notice from the IRS pertaining to any penalty would be sent after an organization has filed their return. Once this notice has been received, an organization must reply and provide a reasonable cause that the IRS could accept and not include this explanation when filing their original return.

Other Penalties:

Other penalties for negligence, substantial understatement of tax, and fraud can also be imposed. See IRC Sections 6662 & 6663 for more details.

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