$195 a Month Penalty for Filing Late Partnership and S Corporation Returns

Beginning in 2009, the late filing penalty for a partnership return is $89 for each MONTH, or part of a month (up to 12 months) the return is late. No penalty is imposed if the partnership can show that they reason for filing late was due to reasonable cause.

For tax years beginning AFTER 2009, the late filing penalty for a partnership return is $195 for each month, or any part of a month, up to 12 months. Once again, if you can show just reason, why the return is late, the penalty won't be imposed.

The penalty for filing an S corporation Return late after, 2009 is also $195 for each month or any part of a month, up to 12 months.

Reasonable cause will release you from having to pay the penalty.
However, if tax is owed with the return, the penalty is INCREASED.

Let's discuss Reasonable Cause:

1. The dog ate the documentation? No.
2. Natural Disaster? Yes.
3. Theft of documents? Maybe (Make sure there is a police report)
4. Forest Fire? Yes
5. Death or Serious illness in the immediate family? Yes
6. Serious illness of one of the partners of the corporation? Probably
7. Accountant left town with all the Corporations money? Probably


You get the idea of what the IRS deems as reasonable cause? Each case is decided separately, I am sure. So you never know. However, chances are they have the acceptable reasons, written within the Tax Codes!