Ezel / IRS Rulings / 201438028

Section 6721 penalty is assessable without deficiency procedures

Number
201438028
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Failure to File Certain Information Returns (See Also 6652.00-00)
Topics
Procedure, penalties, and administration
Code sections
§ 6721
Ruling dated
August 22, 2014
Publicly released
September 19, 2014
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 2014, 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 2014
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 advised that the penalty under section 6721 could be assessed without following deficiency procedures. A taxpayer generally would have to pay the penalty and bring a refund suit to challenge it, unless collection due process procedures were available. The advice therefore approved using the term "assessing" in the proposed penalty letter.

Ruling snapshot

  • Question: Is "assessing" an appropriate term for a section 6721 penalty letter?
  • Outcome: Advice given. The penalty is assessable without deficiency procedures.
  • Key authorities: IRC § 6721

Full text (IRS public release)

ID: CCA_2014082213293528 [Third Party Communication:

UILC: 6721.00-00
Date of Communication: Month DD, YYYY]

Number: 201438028
Release Date: 9/19/2014
From:
Sent: Friday, August 22, 2014 1:29:35 PM
To:
Cc:
Bcc:
Subject: RE: Intentional Disregard Penalty Letter

Glad you sent this again, as I had overlooked it and didn’t realize that I had it on my plate.

The section 6721 penalty is assessable and the IRS does not need to follow deficiency procedures to assess it. The taxpayer would need to pay and bring a refund suit to challenge the penalty (unless the taxpayer uses CDP procedures).

So, assessing is an appropriate term in the letter.

What does the Code say today, for your facts?

This advice was written for IRS staff and cannot be cited. Ezel checks the current Internal Revenue Code and IRS guidance against your situation, with citations.

Opens in Ezel Pro.

  • Checks the law as it stands today, not only this page
  • Cites every source it relies on, so you can verify it
  • Chat, drafting and research in one workspace