Page 23 - Avoid False Claims
P. 23
W HAT ARE THE LEGAL
CONSEQUENCES FOR FILING
A FRIVOLOUS RETURN?
A4.
- Penalties
- Claims and filings that are based upon a position identified as
frivolous by the IRS -or- reflect a desire to delay or impede tax
administration are subject to theInternal Revenue Code (IRC)6702(a)
penalty. This penalty is $5,000 for each return (or copy of return)
claiming an improper credit as defined above. The penalty is assessed
against each spouse on a married filing joint return.(Notice 2010-33)
- Compliance audit
- Uncorrected frivolous claims may be subject to a compliance audit.
Taxpayers may be contacted by an Examination Function and asked to
provide documentation related to the claim. The taxpayer will be
required to verify eligibility for the credit under the law.
- Criminal prosecution
- Individuals or preparers who knowingly file false income tax returns
may face fines and be subject to criminal prosecution and
imprisonment.
TRAINBYUS: TRANSFORMING DIGITAL LEARNING
