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CCA 201034024: Chief Counsel discussed penalties for failing to file Form 5329

Number
201034024
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Failure to File Tax Returns or Pay Tax (Addition v. No Addition to Tax)
Topics
Procedure, penalties, and administration
Code sections
§ 6058, § 6651
Ruling dated
July 30, 2010
Publicly released
August 27, 2010
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 2010, 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 2010
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

Chief Counsel advice addressed whether a failure to file Form 5329 could trigger penalties under § 6651. The advice states that the Form 5329 filing requirement arises under § 6058, which is referenced in § 6651(a)(1), and points to the related regulation and Internal Revenue Manual procedures. It also notes that both failure-to-file and failure-to-pay penalties must be considered when Form 5329 has not been filed, with the applicable amounts separately stated. The advice is limited to the issue presented in the email.

Ruling snapshot

  • Question: What filing requirement and penalty provisions apply when Form 5329 has not been filed?
  • Outcome: Advice given
  • Key authorities: IRC §§ 6058 and 6651; Treas. Reg. § 301.6058-1; IRM 4.4.14.2.8

Full text (IRS public release)

ID: CCA_2010073010185450 Number: 201034024
Release Date: 8/27/2010
Office: -------------------------
UILC: 6651.00-00

From: --------------------
Sent: Friday, July 30, 2010 10:19:08 AM
To: ------------------------------------------
Cc: ----------------------------------------------------------------------------------
Subject: RE: Failure to file apply?

The following is what I found in my research. The requirement to file the Form 5329 is under section 6058 of the Internal Revenue Code that is under subchapter A of chapter 61 (that is referenced in section 6651(a)(1)). Also, see section 301.6058-1(d) of the Procedure and Administration Regulations.

I have also attached a copy of the IRM 4.14 that discuss the penalty and the procedure, specifically I direct your attention to page 5. See 4.4.14.2.8 cited below:

4.4.14.2.8 (11-06-2009)
Penalties

1. Delinquency, negligence, or fraud may be applicable to the excise tax.
The portion of the penalties applicable to the income and IRA excise tax should be separately stated in the "other information" section of the report.
2. If the Form 5329 has not been filed, delinquency penalty under both IRC 6651(a)(1) failure to file and IRC 6651(a)(2) failure to pay must be considered. If the delinquency penalty does apply, and the Form 1040 was timely filed, it must be manually computed in RGS. If the delinquency penalty applies, then the accuracy related penalties should not be assessed against the excise tax.

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