Supplement filing year controlled the penalty amount

Plain-English summary

This brief Chief Counsel email addressed a supplement that was due in one year and filed the next year. It advised that the failure to file occurred in the due year, and that year determined the penalty amount. The email separately explained that the assessment limitation period was not tied directly to the time of the failure. Under section 6501(c)(3), that period did not begin until a return was filed.

Ruling snapshot

• Question: Which year determines the penalty for a late supplement, and when does the assessment period begin?
• Outcome: advice given, the due year controlled the penalty and the assessment period began only when a return was filed
• Key authorities: IRC § 6501(c)(3)

Full text (IRS public release)

ID:        CCA_2019053016355347
UILC:      6035.00-00

Number: 201935012
Release Date: 8/30/2019
From:
Sent: Thursday, May 30, 2019 4:35:54 PM
To:
Cc:
Bcc:
Subject: FW: For Review


-------




In regard to your second bullet, below, where the supplement was due in 2025 and not
filed until 2026, the failure to file occurred in 2025 and that would determine the amount
of the penalty. Calculating the ASED is not directly tied to the time of the failure,
though, because under section 6501(c)(3) the ASED does not begin to run until a return
is filed.

Thanks,

-----


----------------
------------------------------------
------------------------------------
------------
--------------------------