Ezel / IRS Rulings / 200939022

CCA 200939022: Section 6662A applied to understatements, not only underpayments

Number
200939022
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Accuracy Related Penalty on Understatements with respect to Reportable Transactions
Topics
Procedure, penalties, and administration
Code sections
§ 6662A
Ruling dated
August 13, 2009
Publicly released
September 25, 2009
Source
View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2009, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2009
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

An IRS attorney addressed whether the section 6662A penalty applied to a particular tax year and loss. The attorney advised that section 6662A was effective for tax years ending after October 22, 2004, so it did not apply to the redacted year. The attorney also explained that the penalty applies to understatements, and an underpayment is not necessary. Therefore, the fact that a loss was not used in another redacted year did not necessarily mean the penalty was inapplicable.

Ruling snapshot

  • Question: When did the section 6662A penalty apply, and did it require an underpayment?
  • Outcome: Advice given.
  • Key authorities: IRC § 6662A.

Full text (IRS public release)

ID: CCA_2009081316372464 Number: 200939022
Release Date: 9/25/2009
Office: --------------
UILC: 6662A.00-00

From: ------------------
Sent: Thursday, August 13, 2009 4:37:31 PM
To: -----------------
Cc: ----------------------
Subject: RE: 6662A

Section 6662A is effective for tax years ending after 10/22/04, so it will not apply to the ------- year. Note, however, that the 6662A penalty applies to understatements - an underpayment is not necessary. So, the fact that the loss was not used in ------- does not necessarily mean that section 6662A does not apply to -------.

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