US (United States) Code. Title 26. Subtitle F: Procedure and Administration. Chapter 68: Additions to the tax

Codificación normativa de EEUU (Estados Unidos) Legislación Federal estadounidense # Internal revenue code. Additional amounts and assessable penalties

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-CITE-

26 USC CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL

AMOUNTS, AND ASSESSABLE

PENALTIES 01/06/03

-CITE-

26 USC CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL

AMOUNTS, AND ASSESSABLE

PENALTIES 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

-HEAD-

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

-MISC1-

Subchapter Sec.(!1)

A. Additions to the tax and additional amounts 6651

B. Assessable penalties 6671

C. Procedural requirements 6751

AMENDMENTS

1998 - Pub. L. 105-206, title III, Sec. 3306(b), July 22, 1998,

112 Stat. 744, added item for subchapter C.

-SECREF-

CHAPTER REFERRED TO IN OTHER SECTIONS

This chapter is referred to in sections 7463, 7801 of this title.

-FOOTNOTE-

(!1) Section numbers editorially supplied.

-End-

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26 USC Subchapter A - Additions to the Tax and Additional

Amounts 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

-HEAD-

SUBCHAPTER A - ADDITIONS TO THE TAX AND ADDITIONAL AMOUNTS

-MISC1-

Part

I. General provisions.

II. Accuracy-related and fraud penalties.

III. Applicable rules.

AMENDMENTS

1989 - Pub. L. 101-239, title VII, Sec. 7721(c)(13), Dec. 19,

1989, 103 Stat. 2400, added part analysis consisting of parts I to

III.

-End-

-CITE-

26 USC PART I - GENERAL PROVISIONS 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

PART I - GENERAL PROVISIONS

-MISC1-

Sec.

6651. Failure to file tax return or pay tax.(!1)

6652. Failure to file certain information returns,

registration statements, etc.

6653. Failure to pay stamp tax.

6654. Failure by individual to pay estimated income tax.

6655. Failure by corporation to pay estimated income tax.

6656. Failure to make deposit of taxes.

6657. Bad checks.

6658. Coordination with title 11.

[6659 to 6662. Repealed.]

AMENDMENTS

1996 - Pub. L. 104-188, title I, Sec. 1704(t)(19), Aug. 20, 1996,

110 Stat. 1888, struck out item 6662 "Applicable rules".

1989 - Pub. L. 101-239, title VII, Secs. 7721(c)(13), (14),

7742(b), Dec. 19, 1989, 103 Stat. 2400, 2405, added part heading,

substituted "Failure to pay stamp tax" for "Additions to tax for

negligence and fraud" in item 6653, substituted "of taxes" for "of

taxes or over-statement of deposits" in item 6656, and struck out

items 6659 "Addition to tax in the case of valuation overstatements

for purposes of the income tax", 6659A "Addition to tax in case of

overstatements of pension liabilities", 6660 "Addition to tax in

the case of valuation understatement for purposes of estate or gift

taxes", and 6661 "Substantial understatement of liability".

1986 - Pub. L. 99-514, title XI, Sec. 1138(b), title XV, Sec.

1503(d)(2), Oct. 22, 1986, 100 Stat. 2486, 2743, substituted

"Additions to tax for negligence and fraud" for "Failure to pay

tax" in item 6653 and added item 6659A.

1984 - Pub. L. 98-369, div. A, title I, Sec. 155(c)(2)(B), July

18, 1984, 98 Stat. 695, added item 6660.

1982 - Pub. L. 97-248, title III, Sec. 323(b), Sept. 3, 1982, 96

Stat. 615, added item 6661 and redesignated former item 6660 as

6662. See Codification note set out under section 6662 of this

title.

1981 - Pub. L. 97-34, title VII, Secs. 722(a)(2), 724(b)(2), Aug.

13, 1981, 95 Stat. 342, 345, inserted "or overstatement of

deposits" in item 6656, added item 6659, and redesignated item 6659

as 6660.

1980 - Pub. L. 96-589, Sec. 6(e)(2), Dec. 24, 1980, 94 Stat.

3408, added item 6658.

1979 - Pub. L. 96-167, Sec. 6(b), Dec. 29, 1979, 93 Stat. 1276,

struck out item 6658 "Addition to tax in case of jeopardy".

1974 - Pub. L. 93-406, title II, Sec. 1031(b)(1)(B)(ii), Sept. 2,

1974, 88 Stat. 946, inserted ", registration statements, etc." in

item 6652.

1969 - Pub. L. 91-172, title IX, Sec. 943(c)(5), 83 Stat. 729,

inserted "or pay tax" in item 6651.

-SECREF-

SUBCHAPTER REFERRED TO IN OTHER SECTIONS

This subchapter is referred to in section 6229 of this title.

-FOOTNOTE-

(!1) So in original. Does not conform to section catchline.

-End-

-CITE-

26 USC Sec. 6651 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6651. Failure to file tax return or to pay tax

-STATUTE-

(a) Addition to the tax

In case of failure -

(1) to file any return required under authority of subchapter A

of chapter 61 (other than part III thereof), subchapter A of

chapter 51 (relating to distilled spirits, wines, and beer), or

of subchapter A of chapter 52 (relating to tobacco, cigars,

cigarettes, and cigarette papers and tubes), or of subchapter A

of chapter 53 (relating to machine guns and certain other

firearms), on the date prescribed therefor (determined with

regard to any extension of time for filing), unless it is shown

that such failure is due to reasonable cause and not due to

willful neglect, there shall be added to the amount required to

be shown as tax on such return 5 percent of the amount of such

tax if the failure is for not more than 1 month, with an

additional 5 percent for each additional month or fraction

thereof during which such failure continues, not exceeding 25

percent in the aggregate;

(2) to pay the amount shown on tax on any return specified in

paragraph (1) on or before the date prescribed for payment of

such tax (determined with regard to any extension of time for

payment), unless it is shown that such failure is due to

reasonable cause and not due to willful neglect, there shall be

added to the amount shown as tax on such return 0.5 percent of

the amount of such tax if the failure is for not more than 1

month, with an additional 0.5 percent for each additional month

or fraction thereof during which such failure continues, not

exceeding 25 percent in the aggregate; or

(3) to pay any amount in respect of any tax required to be

shown on a return specified in paragraph (1) which is not so

shown (including an assessment made pursuant to section 6213(b))

within 21 calendar days from the date of notice and demand

therefor (10 business days if the amount for which such notice

and demand is made equals or exceeds $100,000), unless it is

shown that such failure is due to reasonable cause and not due to

willful neglect, there shall be added to the amount of tax stated

in such notice and demand 0.5 percent of the amount of such tax

if the failure is for not more than 1 month, with an additional

0.5 percent for each additional month or fraction thereof during

which such failure continues, not exceeding 25 percent in the

aggregate.

In the case of a failure to file a return of tax imposed by chapter

1 within 60 days of the date prescribed for filing of such return

(determined with regard to any extensions of time for filing),

unless it is shown that such failure is due to reasonable cause and

not due to willful neglect, the addition to tax under paragraph (1)

shall not be less than the lesser of $100 or 100 percent of the

amount required to be shown as tax on such return.

(b) Penalty imposed on net amount due

For purposes of -

(1) subsection (a)(1), the amount of tax required to be shown

on the return shall be reduced by the amount of any part of the

tax which is paid on or before the date prescribed for payment of

the tax and by the amount of any credit against the tax which may

be claimed on the return,

(2) subsection (a)(2), the amount of tax shown on the return

shall, for purposes of computing the addition for any month, be

reduced by the amount of any part of the tax which is paid on or

before the beginning of such month and by the amount of any

credit against the tax which may be claimed on the return, and

(3) subsection (a)(3), the amount of tax stated in the notice

and demand shall, for the purpose of computing the addition for

any month, be reduced by the amount of any part of the tax which

is paid before the beginning of such month.

(c) Limitations and special rule

(1) Additions under more than one paragraph

With respect to any return, the amount of the addition under

paragraph (1) of subsection (a) shall be reduced by the amount of

the addition under paragraph (2) of subsection (a) for any month

(or fraction thereof) to which an addition to tax applies under

both paragraphs (1) and (2). In any case described in the last

sentence of subsection (a), the amount of the addition under

paragraph (1) of subsection (a) shall not be reduced under the

preceding sentence below the amount provided in such last

sentence.

(2) Amounts of tax shown more than amount required to be shown

If the amount required to be shown as tax on a return is less

than the amount shown as tax on such return, subsections (a)(2)

and (b)(2) shall be applied by substituting such lower amount.

(d) Increase in penalty for failure to pay tax in certain cases

(1) In general

In the case of each month (or fraction thereof) beginning after

the day described in paragraph (2) of this subsection, paragraphs

(2) and (3) of subsection (a) shall be applied by substituting "1

percent" for "0.5 percent" each place it appears.

(2) Description

For purposes of paragraph (1), the day described in this

paragraph is the earlier of -

(A) the day 10 days after the date on which notice is given

under section 6331(d), or

(B) the day on which notice and demand for immediate payment

is given under the last sentence of section 6331(a).

(e) Exception for estimated tax

This section shall not apply to any failure to pay any estimated

tax required to be paid by section 6654 or 6655.

(f) Increase in penalty for fraudulent failure to file

If any failure to file any return is fraudulent, paragraph (1) of

subsection (a) shall be applied -

(1) by substituting "15 percent" for "5 percent" each place it

appears, and

(2) by substituting "75 percent" for "25 percent".

(g) Treatment of returns prepared by Secretary under section

6020(b)

In the case of any return made by the Secretary under section

6020(b) -

(1) such return shall be disregarded for purposes of

determining the amount of the addition under paragraph (1) of

subsection (a), but

(2) such return shall be treated as the return filed by the

taxpayer for purposes of determining the amount of the addition

under paragraphs (2) and (3) of subsection (a).

(h) Limitation on penalty on individual's failure to pay for months

during period of installment agreement

In the case of an individual who files a return of tax on or

before the due date for the return (including extensions),

paragraphs (2) and (3) of subsection (a) shall each be applied by

substituting "0.25" for "0.5" each place it appears for purposes of

determining the addition to tax for any month during which an

installment agreement under section 6159 is in effect for the

payment of such tax.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 821; Pub. L. 90-364, title I,

Sec. 103(e)(4), June 28, 1968, 82 Stat. 264; Pub. L. 91-172, title

IX, Sec. 943(a), Dec. 30, 1969, 83 Stat. 727; Pub. L. 92-9, Sec.

3(j)(1), Apr. 1, 1971, 85 Stat. 22; Pub. L. 94-455, title XIX, Sec.

1904(b)(10)(A)(v), Oct. 4, 1976, 90 Stat. 1817; Pub. L. 97-248,

title III, Sec. 318(a), (b), Sept. 3, 1982, 96 Stat. 610; Pub. L.

98-369, div. A, title IV, Sec. 412(b)(8), July 18, 1984, 98 Stat.

792; Pub. L. 99-514, title XV, Sec. 1502(a), (b), Oct. 22, 1986,

100 Stat. 2741; Pub. L. 100-203, title X, Sec. 10301(b)(6), Dec.

22, 1987, 101 Stat. 1330-429; Pub. L. 101-239, title VII, Sec.

7741(a), Dec. 19, 1989, 103 Stat. 2404; Pub. L. 104-168, title III,

Sec. 303(b)(2), title XIII, Sec. 1301(a), July 30, 1996, 110 Stat.

1458, 1475; Pub. L. 105-206, title III, Sec. 3303(a), July 22,

1998, 112 Stat. 742.)

-MISC1-

AMENDMENTS

1998 - Subsec. (h). Pub. L. 105-206 added subsec. (h).

1996 - Subsec. (a)(3). Pub. L. 104-168, Sec. 303(b)(2),

substituted "21 calendar days from the date of notice and demand

therefor (10 business days if the amount for which such notice and

demand is made equals or exceeds $100,000)" for "10 days of the

date of the notice and demand therefor".

Subsec. (g). Pub. L. 104-168, Sec. 1301(a), added subsec. (g).

1989 - Subsec. (f). Pub. L. 101-239 added subsec. (f).

1987 - Subsec. (e). Pub. L. 100-203 substituted "section 6654 or

6655" for "section 6154 or 6654".

1986 - Subsec. (c)(1). Pub. L. 99-514, Sec. 1502(b), amended par.

(1) generally, striking out the designation "(A)" before "With

respect to", inserting "(or fraction thereof)", and striking out

subpar. (B) which read as follows: "With respect to any return, the

maximum amount of the addition permitted under paragraph (3) of

subsection (a) shall be reduced by the amount of the addition under

paragraph (1) of subsection (a) (determined without regard to the

last sentence of such subsection) which is attributable to the tax

for which the notice and demand is made and which is not paid

within 10 days of notice and demand."

Subsecs. (d), (e). Pub. L. 99-514, Sec. 1502(a), added subsec.

(d) and redesignated former subsec. (d) as (e).

1984 - Subsec. (d). Pub. L. 98-369 in amending subsec. (d)

generally, substituted in heading "estimated tax" for "declarations

of estimated tax", struck out provisions making section

inapplicable to any failure to file a declaration of estimated tax

required by section 6015 or to any failure to pay any estimated tax

required to be paid by section 6153, and made section inapplicable

to any failure to pay any estimated tax required to be paid by

section 6654.

1982 - Subsec. (a). Pub. L. 97-248, Sec. 318(a), inserted

provision that, in the case of a failure to file a return of tax

imposed by chapter 1 within 60 days of the date prescribed for

filing of such return (determined with regard to any extensions of

time for filing), unless it is shown that such failure is due to

reasonable cause and not due to willful neglect, the addition to

tax under par. (1) shall not be less than the lesser of $100 or 100

percent of the amount required to be shown as tax on such return.

Subsec. (c)(1)(A). Pub. L. 97-248, Sec. 318(b)(1), inserted

provision that in any case described in last sentence of subsec.

(a), the amount of the addition under par. (1) of subsec. (a) shall

not be reduced under first sentence of this subpar. below the

amount provided in such last sentence.

Subsec. (c)(1)(B). Pub. L. 97-248, Sec. 318(b)(2), inserted

"(determined without regard to the last sentence of such

subsection)" after "paragraph (1) of subsection (a)".

1976 - Subsec. (e). Pub. L. 94-455 struck out subsec. (e) which

related to certain interest equalization tax returns.

1971 - Subsec. (e). Pub. L. 92-9 added subsec. (e).

1969 - Subsec. (a). Pub. L. 91-172 designated existing provisions

as par. (1) and added pars. (2) and (3).

Subsec. (b). Pub. L. 91-172 designated existing provisions as

par. (1) and added pars. (2) and (3).

Subsecs. (c), (d). Pub. L. 91-172 added subsec. (c), redesignated

former subsec. (c) as (d) and struck out reference to section 6016

of this title and provided that this section would not be

applicable for failure to pay any estimated tax required under

section 6153 or 6154 of this title.

1968 - Subsec. (c). Pub. L. 90-364 struck out reference to

section 6016.

EFFECTIVE DATE OF 1998 AMENDMENT

Pub. L. 105-206, title III, Sec. 3303(b), July 22, 1998, 112

Stat. 742, provided that: "The amendment made by this section

[amending this section] shall apply for purposes of determining

additions to the tax for months beginning after December 31, 1999."

EFFECTIVE DATE OF 1996 AMENDMENT

Amendment by section 303(b)(2) of Pub. L. 104-168 applicable in

case of any notice and demand given after Dec. 31, 1996, see

section 303(c) of Pub. L. 104-168, set out as a note under section

6601 of this title.

Section 1301(b) of Pub. L. 104-168 provided that: "The amendment

made by subsection (a) [amending this section] shall apply in the

case of any return the due date for which (determined without

regard to extensions) is after the date of the enactment of this

Act [July 30, 1996]."

EFFECTIVE DATE OF 1989 AMENDMENT

Section 7741(b) of Pub. L. 101-239 provided that: "The amendment

made by subsection (a) [amending this section] shall apply in the

case of failures to file returns the due date for which (determined

without regard to extensions) is after December 31, 1989."

EFFECTIVE DATE OF 1987 AMENDMENT

Amendment by Pub. L. 100-203 applicable to taxable years

beginning after Dec. 31, 1987, see section 10301(c) of Pub. L.

100-203, set out as a note under section 585 of this title.

EFFECTIVE DATE OF 1986 AMENDMENT

Section 1502(c) of Pub. L. 99-514 provided that:

"(1) Subsection (a). - The amendments made by subsection (a)

[amending this section] shall apply -

"(A) to failures to pay which begin after December 31, 1986,

and

"(B) to failures to pay which begin on or before December 31,

1986, if after December 31, 1986 -

"(i) notice (or renotice) under section 6331(d) of the

Internal Revenue Code of 1954 [now 1986] is given with respect

to such failure, or

"(ii) notice and demand for immediate payment of the

underpayment is made under the last sentence of section 6331(a)

of such Code.

In the case of a failure to pay described in subparagraph (B),

paragraph (2) of section 6651(d) of such Code (as added by

subsection (a)) shall be applied by taking into account the first

notice (or renotice) after December 31, 1986.

"(2) Subsection (b). - The amendment made by subsection (b)

[amending this section] shall apply to amounts assessed after

December 31, 1986, with respect to failures to pay which begin

before, on, or after such date."

EFFECTIVE DATE OF 1984 AMENDMENT

Amendment by Pub. L. 98-369 applicable with respect to taxable

years beginning after Dec. 31, 1984, see section 414(a)(1) of Pub.

L. 98-369, set out as a note under section 6654 of this title.

EFFECTIVE DATE OF 1982 AMENDMENT

Section 318(c) of Pub. L. 97-248 provided that: "The amendments

made by this section [amending this section] shall apply to returns

the due date for filing of which (including extensions) is after

December 31, 1982."

EFFECTIVE DATE OF 1971 AMENDMENT

Section 3(j)(3) of Pub. L. 92-9 provided that: "The amendments

made by this subsection [amending this section and section 6680 of

this title] shall apply with respect to returns required to be

filed on or after the date of the enactment of this Act [Apr. 1,

1971]."

EFFECTIVE DATE OF 1969 AMENDMENT

Section 943(d) of Pub. L. 91-172 provided that: "The amendments

made by subsections (a) [amending this section] and (c) [amending

sections 3121, 5684, and 6653 of this title] shall apply with

respect to returns the date prescribed by law (without regard to

any extension of time) for filing of which is after December 31,

1969, and with respect to notices and demands for payment of tax

made after December 31, 1969. The amendment made by subsection (b)

[amending section 6656 of this title] shall apply with respect to

deposits the time for making of which is after December 31, 1969."

EFFECTIVE DATE OF 1968 AMENDMENT

Amendment by Pub. L. 90-364 applicable with respect to taxable

years beginning after Dec. 31, 1967, except as provided by section

104 of Pub. L. 90-364, see section 103(f) of Pub. L. 90-364, set

out as a note under section 243 of this title.

ILLEGAL TAX PROTESTER DESIGNATION

Pub. L. 105-206, title III, Sec. 3707, July 22, 1998, 112 Stat.

778, provided that:

"(a) Prohibition. - The officers and employees of the Internal

Revenue Service -

"(1) shall not designate taxpayers as illegal tax protesters

(or any similar designation); and

"(2) in the case of any such designation made on or before the

date of the enactment of this Act [July 22, 1998] -

"(A) shall remove such designation from the individual master

file; and

"(B) shall disregard any such designation not located in the

individual master file.

"(b) Designation of Nonfilers Allowed. - An officer or employee

of the Internal Revenue Service may designate any appropriate

taxpayer as a nonfiler, but shall remove such designation once the

taxpayer has filed income tax returns for 2 consecutive taxable

years and paid all taxes shown on such returns.

"(c) Effective Date. - The provisions of this section shall take

effect on the date of the enactment of this Act [July 22, 1998],

except that the removal of any designation under subsection

(a)(2)(A) shall not be required to begin before January 1, 1999."

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 3121, 5684, 5761, 6013,

6404, 6601, 6658, 6665, 6751, 7518 of this title; title 30 section

932; title 46 App. section 1177.

-End-

-CITE-

26 USC Sec. 6652 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6652. Failure to file certain information returns,

registration statements, etc.

-STATUTE-

(a) Returns with respect to certain payments aggregating less than

$10

In the case of each failure to file a statement of a payment to

another person required under the authority of -

(1) section 6042(a)(2) (relating to payments of dividends

aggregating less than $10), or

(2) section 6044(a)(2) (relating to payments of patronage

dividends aggregating less than $10),

on the date prescribed therefor (determined with regard to any

extension of time for filing), unless it is shown that such failure

is due to reasonable cause and not to willful neglect, there shall

be paid (upon notice and demand by the Secretary and in the same

manner as tax) by the person failing to so file the statement, $1

for each such statement not so filed, but the total amount imposed

on the delinquent person for all such failures during the calendar

year shall not exceed $1,000.

(b) Failure to report tips

In the case of failure by an employee to report to his employer

on the date and in the manner prescribed therefor any amount of

tips required to be so reported by section 6053(a) which are wages

(as defined in section 3121(a)) or which are compensation (as

defined in section 3231(e)), unless it is shown that such failure

is due to reasonable cause and not due to willful neglect, there

shall be paid by the employee, in addition to the tax imposed by

section 3101 or section 3201 (as the case may be) with respect to

the amount of tips which he so failed to report, an amount equal to

50 percent of such tax.

(c) Returns by exempt organizations and by certain trusts

(1) Annual returns under section 6033 or 6012(a)(6)

(A) Penalty on organization

In the case of -

(i) a failure to file a return required under section 6033

(relating to returns by exempt organizations) or section

6012(a)(6) (relating to returns by political organizations)

on the date and in the manner prescribed therefor (determined

with regard to any extension of time for filing), or

(ii) a failure to include any of the information required

to be shown on a return filed under section 6033 or section

6012(a)(6) or to show the correct information,

there shall be paid by the exempt organization $20 for each day

during which such failure continues. The maximum penalty under

this subparagraph on failures with respect to any 1 return

shall not exceed the lesser of $10,000 or 5 percent of the

gross receipts of the organization for the year. In the case of

an organization having gross receipts exceeding $1,000,000 for

any year, with respect to the return required under section

6033 or section 6012(a)(6) for such year, the first sentence of

this subparagraph shall be applied by substituting "$100" for

"$20" and, in lieu of applying the second sentence of this

subparagraph, the maximum penalty under this subparagraph shall

not exceed $50,000.

(B) Managers

(i) In general

The Secretary may make a written demand on any organization

subject to penalty under subparagraph (A) specifying therein

a reasonable future date by which the return shall be filed

(or the information furnished) for purposes of this

subparagraph.

(ii) Failure to comply with demand

If any person fails to comply with any demand under clause

(i) on or before the date specified in such demand, there

shall be paid by the person failing to so comply $10 for each

day after the expiration of the time specified in such demand

during which such failure continues. The maximum penalty

imposed under this subparagraph on all persons for failures

with respect to any 1 return shall not exceed $5,000.

(C) Public inspection of annual returns and reports

In the case of a failure to comply with the requirements of

section 6104(d) with respect to any annual return on the date

and in the manner prescribed therefor (determined with regard

to any extension of time for filing) or report required under

section 527(j), there shall be paid by the person failing to

meet such requirements $20 for each day during which such

failure continues. The maximum penalty imposed under this

subparagraph on all persons for failures with respect to any 1

return or report shall not exceed $10,000.

(D) Public inspection of applications for exemption and notice

of status

In the case of a failure to comply with the requirements of

section 6104(d) with respect to any exempt status application

materials (as defined in such section) or notice materials (as

defined in such section) on the date and in the manner

prescribed therefor, there shall be paid by the person failing

to meet such requirements $20 for each day during which such

failure continues.

(2) Returns under section 6034 or 6043(b)

(A) Penalty on organization or trust

In the case of a failure to file a return required under

section 6034 (relating to returns by certain trusts) or section

6043(b) (relating to terminations, etc., of exempt

organizations), on the date and in the manner prescribed

therefor (determined with regard to any extension of time for

filing), there shall be paid by the exempt organization or

trust failing so to file $10 for each day during which such

failure continues, but the total amount imposed under this

subparagraph on any organization or trust for failure to file

any 1 return shall not exceed $5,000.

(B) Managers

The Secretary may make written demand on an organization or

trust failing to file under subparagraph (A) specifying therein

a reasonable future date by which such filing shall be made for

purposes of this subparagraph. If such filing is not made on or

before such date, there shall be paid by the person failing so

to file $10 for each day after the expiration of the time

specified in the written demand during which such failure

continues, but the total amount imposed under this subparagraph

on all persons for failure to file any 1 return shall not

exceed $5,000.

(3) Reasonable cause exception

No penalty shall be imposed under this subsection with respect

to any failure if it is shown that such failure is due to

reasonable cause.

(4) Other special rules

(A) Treatment as tax

Any penalty imposed under this subsection shall be paid on

notice and demand of the Secretary and in the same manner as

tax.

(B) Joint and several liability

If more than 1 person is liable under this subsection for any

penalty with respect to any failure, all such persons shall be

jointly and severally liable with respect to such failure.

(C) Person

For purposes of this subsection, the term "person" means any

officer, director, trustee, employee, or other individual who

is under a duty to perform the act in respect of which the

violation occurs.

(d) Annual registration and other notification by pension plan

(1) Registration

In the case of any failure to file a registration statement

required under section 6057(a) (relating to annual registration

of certain plans) which includes all participants required to be

included in such statement, on the date prescribed therefor

(determined without regard to any extension of time for filing),

unless it is shown that such failure is due to reasonable cause,

there shall be paid (on notice and demand by the Secretary and in

the same manner as tax) by the person failing so to file, an

amount equal to $1 for each participant with respect to whom

there is a failure to file, multiplied by the number of days

during which such failure continues, but the total amount imposed

under this paragraph on any person for any failure to file with

respect to any plan year shall not exceed $5,000.

(2) Notification of change of status

In the case of failure to file a notification required under

section 6057(b) (relating to notification of change of status) on

the date prescribed therefor (determined without regard to any

extension of time for filing), unless it is shown that such

failure is due to reasonable cause, there shall be paid (on

notice and demand by the Secretary and in the same manner as tax)

by the person failing so to file, $1 for each day during which

such failure continues, but the total amounts imposed under this

paragraph on any person for failure to file any notification

shall not exceed $1,000.

(e) Information required in connection with certain plans of

deferred compensation, etc.

In the case of failure to file a return or statement required

under section 6058 (relating to information required in connection

with certain plans of deferred compensation), 6047 (relating to

information relating to certain trusts and annuity and bond

purchase plans), or 6039D (relating to returns and records with

respect to certain fringe benefit plans) on the date and in the

manner prescribed therefor (determined with regard to any extension

of time for filing), unless it is shown that such failure is due to

reasonable cause, there shall be paid (on notice and demand by the

Secretary and in the same manner as tax) by the person failing so

to file, $25 for each day during which such failure continues, but

the total amount imposed under this subsection on any person for

failure to file any return shall not exceed $15,000. This

subsection shall not apply to any return or statement which is an

information return described in section 6724(d)(1)(C)(ii) or a

payee statement described in section 6724(d)(2)(Y).

(f) Returns required under section 6039C

(1) In general

In the case of each failure to make a return required by

section 6039C which contains the information required by such

section on the date prescribed therefor (determined with regard

to any extension of time for filing), unless it is shown that

such failure is due to reasonable cause and not to willful

neglect, the amount determined under paragraph (2) shall be paid

(upon notice and demand by the Secretary and in the same manner

as tax) by the person failing to make such return.

(2) Amount of penalty

For purposes of paragraph (1), the amount determined under this

paragraph with respect to any failure shall be $25 for each day

during which such failure continues.

(3) Limitation

The amount determined under paragraph (2) with respect to any

person for failing to meet the requirements of section 6039C for

any calendar year shall not exceed the lesser of -

(A) $25,000, or

(B) 5 percent of the aggregate of the fair market value of

the United States real property interests owned by such person

at any time during such year.

For purposes of the preceding sentence, fair market value shall

be determined as of the end of the calendar year (or, in the case

of any property disposed of during the calendar year, as of the

date of such disposition).

(g) Information required in connection with deductible employee

contributions

In the case of failure to make a report required by section

219(f)(4) which contains the information required by such section

on the date prescribed therefor (determined with regard to any

extension of time for filing), there shall be paid (on notice and

demand by the Secretary and in the same manner as tax) by the

person failing so to file, an amount equal to $25 for each

participant with respect to whom there was a failure to file such

information, multiplied by the number of years during which such

failure continues, but the total amount imposed under this

subsection on any person for failure to file shall not exceed

$10,000. No penalty shall be imposed under this subsection on any

failure which is shown to be due to reasonable cause and not

willful neglect.

(h) Failure to give notice to recipients of certain pension, etc.,

distributions

In the case of each failure to provide notice as required by

section 3405(e)(10)(B), at the time prescribed therefor, unless it

is shown that such failure is due to reasonable cause and not to

willful neglect, there shall be paid, on notice and demand of the

Secretary and in the same manner as tax, by the person failing to

provide such notice, an amount equal to $10 for each such failure,

but the total amount imposed on such person for all such failures

during any calendar year shall not exceed $5,000.

(i) Failure to give written explanation to recipients of certain

qualifying rollover distributions

In the case of each failure to provide a written explanation as

required by section 402(f), at the time prescribed therefor, unless

it is shown that such failure is due to reasonable cause and not to

willful neglect, there shall be paid, on notice and demand of the

Secretary and in the same manner as tax, by the person failing to

provide such written explanation, an amount equal to $100 for each

such failure, but the total amount imposed on such person for all

such failures during any calendar year shall not exceed $50,000.

(j) Failure to file certification with respect to certain

residential rental projects

In the case of each failure to provide a certification as

required by section 142(d)(7) at the time prescribed therefor,

unless it is shown that such failure is due to reasonable cause and

not to willful neglect, there shall be paid, on notice and demand

of the Secretary and in the same manner as tax, by the person

failing to provide such certification, an amount equal to $100 for

each such failure.

(k) (!1) Failure to make reports required under section 1202

In the case of a failure to make a report required under section

1202(d)(1)(C) which contains the information required by such

section on the date prescribed therefor (determined with regard to

any extension of time for filing), there shall be paid (on notice

and demand by the Secretary and in the same manner as tax) by the

person failing to make such report, an amount equal to $50 for each

report with respect to which there was such a failure. In the case

of any failure due to negligence or intentional disregard, the

preceding sentence shall be applied by substituting "$100" for

"$50". In the case of a report covering periods in 2 or more years,

the penalty determined under preceding provisions of this

subsection shall be multiplied by the number of such years. No

penalty shall be imposed under this subsection on any failure which

is shown to be due to reasonable cause and not willful neglect.

(g742l) Failure to file return with respect to certain corporate

transactions

In the case of any failure to make a return required under

section 6043(c) containing the information required by such section

on the date prescribed therefor (determined with regard to any

extension of time for filing), unless it is shown that such failure

is due to reasonable cause, there shall be paid (on notice and

demand by the Secretary and in the same manner as tax) by the

person failing to file such return, an amount equal to $500 for

each day during which such failure continues, but the total amount

imposed under this subsection with respect to any return shall not

exceed $100,000.

(m) Alcohol and tobacco taxes

For penalties for failure to file certain information returns

with respect to alcohol and tobacco taxes, see, generally,

subtitle E.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 821; Pub. L. 85-866, title I,

Sec. 85, Sept. 2, 1958, 72 Stat. 1664; Pub. L. 87-834, Sec. 19(d),

Oct. 16, 1962, 76 Stat. 1057; Pub. L. 88-272, title II, Sec.

221(b)(2), Feb. 26, 1964, 78 Stat. 74; Pub. L. 89-97, title III,

Sec. 313(e)(2)(B), (3), July 30, 1965, 79 Stat. 385; Pub. L.

89-212, Sec. 2(e), Sept. 29, 1965, 79 Stat. 859; Pub. L. 91-172,

title I, Sec. 101(d)(4), Dec. 30, 1969, 83 Stat. 522; Pub. L.

93-406, title II, Sec. 1031(b)(1)(A), (B)(i), Sept. 2, 1974, 88

Stat. 945, 946; Pub. L. 94-455, title XII, Sec. 1207(e)(3)(B), (C),

title XIX, Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1708, 1834;

Pub. L. 96-167, Sec. 7(b)(1), Dec. 29, 1979, 93 Stat. 1277; Pub. L.

96-223, title I, Sec. 101(d)(2)(A), Apr. 2, 1980, 94 Stat. 251;

Pub. L. 96-499, title XI, Sec. 1123(b), Dec. 5, 1980, 94 Stat.

2689; Pub. L. 96-603, Sec. 1(d)(2), Dec. 28, 1980, 94 Stat. 3504;

Pub. L. 97-34, title III, Sec. 311(f), title VII, Sec. 723(a)(1),

(3), (4), Aug. 13, 1981, 95 Stat. 281, 343, 344; Pub. L. 97-248,

title III, Secs. 309(b)(2), 315(a), (b), Sept. 3, 1982, 96 Stat.

595, 605, 606; Pub. L. 97-448, title II, Sec. 201(i)(2), Jan. 12,

1983, 96 Stat. 2395; Pub. L. 98-67, title I, Sec. 105(b)(1), Aug.

5, 1983, 97 Stat. 380; Pub. L. 98-369, div. A, title I, Secs.

145(b)(1), (2), 146(b)(1), (2), 148(b)(1), (2), 149(b)(1),

155(b)(2)(A), title IV, Sec. 491(d)(50), title V, Sec.

531(b)(4)(B), title VII, Sec. 714(j)(3), July 18, 1984, 98 Stat.

685, 686, 688, 689, 693, 852, 882, 963; Pub. L. 98-397, title II,

Sec. 207(b), Aug. 23, 1984, 98 Stat. 1450; Pub. L. 98-611, Sec.

1(d)(2), Oct. 31, 1984, 98 Stat. 3177; Pub. L. 98-612, Sec.

1(b)(2), Oct. 31, 1984, 98 Stat. 3181; Pub. L. 99-514, title XI,

Sec. 1151(b), title XIII, Sec. 1301(g), title XV, Sec.

1501(d)(1)(A), title XVII, Sec. 1702(b), title XVIII, Secs.

1810(f)(9), 1811(c)(2), Oct. 22, 1986, 100 Stat. 2502, 2656, 2740,

2774, 2828, 2833; Pub. L. 100-203, title X, Secs. 10502(d)(11),

10704(a), Dec. 22, 1987, 101 Stat. 1330-444, 1330-461; Pub. L.

100-647, title I, Secs. 1011B(a)(10), 1017(b), 1018(u)(36), title

III, Sec. 3021(a)(10), Nov. 10, 1988, 102 Stat. 3484, 3575, 3592,

3630; Pub. L. 101-140, title II, Sec. 203(a)(1), Nov. 8, 1989, 103

Stat. 830; Pub. L. 101-239, title VII, Secs. 7208(b)(2),

7841(d)(5), Dec. 19, 1989, 103 Stat. 2338, 2428; Pub. L. 102-318,

title V, Sec. 522(b)(2)(F), July 3, 1992, 106 Stat. 314; Pub. L.

103-66, title XIII, Sec. 13113(c), Aug. 10, 1993, 107 Stat. 429;

Pub. L. 104-168, title XIII, Secs. 1314(a), (b), July 30, 1996, 110

Stat. 1480; Pub. L. 104-188, title I, Secs. 1455(c), (d)(2),

1704(s), Aug. 20, 1996, 110 Stat. 1818, 1887; Pub. L. 105-34, title

XII, Sec. 1281(a), (b), title XVI, Sec. 1602(d)(2)(B), Aug. 5,

1997, 111 Stat. 1037, 1094; Pub. L. 105-277, div. J, title I, Sec.

1004(b)(2)(B), (C), Oct. 21, 1998, 112 Stat. 2681-890; Pub. L.

106-230, Secs. 1(c), 2(c), 3(c), July 1, 2000, 114 Stat. 479, 482,

483.)

-COD-

CODIFICATION

Pub. L. 101-140, Sec. 203(a)(1), amended this section to read as

if the amendments made by section 1151(b) of Pub. L. 99-514

(enacting subsec. (l)) had not been enacted. Subsequent to

enactment by Pub. L. 99-514, subsec. (l) was amended by Pub. L.

100-203, Pub. L. 100-647, and Pub. L. 101-239. See 1989, 1988, and

1987 Amendment notes below.

-MISC1-

AMENDMENTS

2000 - Subsec. (c)(1). Pub. L. 106-230, Sec. 3(c)(4), inserted

"or 6012(a)(6)" after "section 6033" in heading.

Subsec. (c)(1)(A). Pub. L. 106-230, Sec. 3(c)(3), inserted "or

section 6012(a)(6)" after "section 6033" in last sentence.

Subsec. (c)(1)(A)(i). Pub. L. 106-230, Sec. 3(c)(1), inserted "or

section 6012(a)(6) (relating to returns by political

organizations)" after "organizations)".

Subsec. (c)(1)(A)(ii). Pub. L. 106-230, Sec. 3(c)(2), inserted

"or section 6012(a)(6)" after "section 6033".

Subsec. (c)(1)(C). Pub. L. 106-230, Sec. 2(c), in heading

inserted "and reports" after "returns" and in text inserted "or

report required under section 527(j)" after "filing)" and "or

report" after "1 return".

Subsec. (c)(1)(D). Pub. L. 106-230, Sec. 1(c), in heading

inserted "and notice of status" after "exemption" and in text

inserted "or notice materials (as defined in such section)" after

"section)".

1998 - Subsec. (c)(1)(C). Pub. L. 105-277, Sec. 1004(b)(2)(B),

substituted "section 6104(d) with respect to any annual return" for

"subsection (d) or (e)(1) of section 6104 (relating to public

inspection of annual returns)".

Subsec. (c)(1)(D). Pub. L. 105-277, Sec. 1004(b)(2)(C),

substituted "section 6104(d) with respect to any exempt status

application materials (as defined in such section)" for "section

6104(e)(2) (relating to public inspection of applications for

exemption)".

1997 - Subsec. (e). Pub. L. 105-34, Sec. 1602(d)(2)(B),

substituted "section 6724(d)(2)(Y)" for "section 6724(d)(2)(X)".

Subsec. (g). Pub. L. 105-34, Sec. 1281(a), inserted at end "No

penalty shall be imposed under this subsection on any failure which

is shown to be due to reasonable cause and not willful neglect."

Subsec. (k). Pub. L. 105-34, Sec. 1281(b), inserted at end "No

penalty shall be imposed under this subsection on any failure which

is shown to be due to reasonable cause and not willful neglect."

1996 - Subsec. (c)(1)(A). Pub. L. 104-168 in concluding

provisions, substituted "$20" for "$10" and "$10,000" for "$5,000"

and inserted at end "In the case of an organization having gross

receipts exceeding $1,000,000 for any year, with respect to the

return required under section 6033 for such year, the first

sentence of this subparagraph shall be applied by substituting

'$100' for '$20' and, in lieu of applying the second sentence of

this subparagraph, the maximum penalty under this subparagraph

shall not exceed $50,000."

Subsec. (c)(1)(C). Pub. L. 104-188, Sec. 1704(s)(1), substituted

"$20" for "$10" and "$10,000" for "$5,000".

Subsec. (c)(1)(D). Pub. L. 104-188, Sec. 1704(s)(2), substituted

"$20" for "$10".

Subsec. (e). Pub. L. 104-188, Sec. 1455(d)(2), inserted at end

"This subsection shall not apply to any return or statement which

is an information return described in section 6724(d)(1)(C)(ii) or

a payee statement described in section 6724(d)(2)(X)."

Subsec. (i). Pub. L. 104-188, Sec. 1455(c), substituted "$100"

and "$50,000" for "the $10" and "$5,000", respectively.

1993 - Subsec. (k). Pub. L. 103-66, which directed amendment of

section by adding subsec. (k) before the last subsection, was

executed by adding subsec. (k) after subsec. (j) to reflect the

probable intent of Congress.

1992 - Subsec. (h). Pub. L. 102-318 substituted "3405(e)(10)(B)"

for "3405(d)(10)(B)".

1989 - Subsec. (k). Pub. L. 101-239, Sec. 7841(d)(5)(B),

redesignated the subsec. (k), relating to alcohol and tobacco

taxes, as (l).

Pub. L. 101-239, Sec. 7841(d)(5)(A), redesignated the subsection

relating to information with respect to includible employee

benefits as (k), see Codification note above.

Pub. L. 101-140 amended this section to read as if amendments by

Pub. L. 99-514, Sec. 1151(b), had not been enacted, see

Codification note above and 1986 Amendment note below.

Subsec. (l). Pub. L. 101-239, Sec. 7208(b)(2), added subsec. (l)

and redesignated former subsec. (l) as (m).

Pub. L. 101-239, Sec. 7841(d)(5)(B), redesignated subsec. (k),

relating to alcohol and tobacco taxes, as (l).

Subsec. (m). Pub. L. 101-239, Sec. 7208(b)(2), redesignated

subsec. (l) as (m).

1988 - Subsec. (j). Pub. L. 100-647, Sec. 1017(b), amended

subsec. (j) as it existed prior to its repeal by Pub. L. 100-203,

Sec. 10502(d)(11), by inserting "(and the corresponding provision

of section 4041(d)(1))" after "section 4041(a)(1)", see 1987

Amendment note below.

Subsec. (k)(2)(B). Pub. L. 100-647, Sec. 3021(a)(10), amended

subpar. (B) generally. Prior to amendment, subpar. (B) read as

follows: "the employer-provided benefit (within the meaning of

section 89 without regard to subsection (g)(3) thereof) with

respect to the employee to whom such failure relates." See

Codification note above.

Pub. L. 100-647, Sec. 1011B(a)(10), substituted "subsection

(g)(3)(C)(i)" for "subsection (g)(3)". See Codification note above.

Subsec. (k)(4). Pub. L. 100-647, Sec. 1018(u)(36), substituted

"or part II of subchapter B of this chapter" for "or section 6678".

See Codification note above.

1987 - Subsec. (c). Pub. L. 100-203, Sec. 10704(a), amended

subsec. (c) generally, revising and restating as pars. (1) to (4)

provisions of former pars. (1) to (3).

Subsec. (j). Pub. L. 100-203, Sec. 10502(d)(11), struck out

subsec. (j), as added by section 1702(b) of Pub. L. 99-514, which

related to failure to give written notice to certain sellers of

diesel fuel.

Subsecs. (k), (l). Pub. L. 100-203, Sec. 10502(d)(11),

redesignated subsec. (l), relating to information with respect to

includible employee benefits, as (k), and directed the

redesignation of a nonexistent subsec. (m) as (l). See Codification

note above.

1986 - Subsec. (a). Pub. L. 99-514, Sec. 1501(d)(1)(A),

redesignated subsec. (b) as (a), substituted "Returns with respect

to certain payments aggregating less than $10" for "Other returns"

in heading, and struck out former subsec. (a) which provided

penalties for failure to file returns relating to information at

source, payments of dividends, etc. and certain transfers of stock.

Pub. L. 99-514, Sec. 1811(c)(2), inserted "(other than by

subsection (d) of such section)" in par. (3)(A)(ii).

Subsecs. (b) to (f). Pub. L. 99-514, Sec. 1501(d)(1)(A)(i),

redesignated subsecs. (c) to (f) as (b) to (e), respectively.

Former subsec. (b) redesignated (a).

Subsec. (g). Pub. L. 99-514, Sec. 1501(d)(1)(A)(i), redesignated

subsec. (h) as (g). Former subsec. (g) redesignated (f).

Pub. L. 99-514, Sec. 1810(f)(9)(C), struck out "etc.," after

"Returns" in heading.

Subsec. (g)(1). Pub. L. 99-514, Sec. 1810(f)(9)(A), in amending

par. (1) generally, struck out "(A)" after "In the case of each

failure", and struck out "(B) to furnish a statement required by

section 6039C(b)(3)," before "on the date required".

Subsec. (g)(3). Pub. L. 99-514, Sec. 1810(f)(9)(B), in amending

par. (3) generally, designated former subpar. (B) of par. (3) as

the entire paragraph, struck out former subpar. (A) setting a

limitation of $25,000 with respect to each subsection for failure

to meet the requirements of subsection (a) or (b) of section 6039C,

struck out former subpar. (B) heading "For failure to meet

requirements of section 6039C(c)" and in text substituted

"requirements of section 6039C" for "requirements of subsection (c)

of section 6039C" and inserted "(A)" before "$25,000" and "(B)"

before "5 percent".

Subsecs. (h), (i). Pub. L. 99-514, Sec. 1501(d)(1)(A)(i),

redesignated subsecs. (i) and (j) as (h) and (i), respectively.

Former subsec. (h) redesignated (g).

Subsec. (j). Pub. L. 99-514, Sec. 1702(b), added subsec. (j)

relating to failure to give written notice to certain sellers of

diesel fuel, and redesignated former subsec. (j), relating to

alcohol and tobacco taxes, as (k).

Pub. L. 99-514, Sec. 1301(g), added subsec. (j) relating to

failure to file certification with respect to certain residential

projects.

Pub. L. 99-514, Sec. 1501(d)(1)(A)(i), redesignated subsec. (k),

relating to alcohol and tobacco taxes, as (j). Former subsec. (j),

relating to failure to give written explanation to recipients of

certain qualifying rollover distributions, redesignated (i). Such

subsec. (j), relating to alcohol and tobacco taxes, was

subsequently redesignated as subsec. (k) by section 1301(g) of Pub.

L. 99-514, and also by section 1702(b) of Pub. L. 99-514, both of

which added a new subsec. (j), see above.

Subsec. (k). Pub. L. 99-514, Sec. 1501(d)(1)(A)(i), redesignated

subsec. (k), relating to alcohol and tobacco taxes, as (j).

Subsequently, such subsec. (j) was redesignated as subsec. (k) by

section 1301(g) of Pub. L. 99-514, and also by section 1702(b) of

Pub. L. 99-514.

Subsecs. (l), (m). Pub. L. 99-514, Sec. 1151(b), directed the

redesignation of a nonexistent subsec. (l) as (m), and added a new

subsec. (l) relating to information with respect to includible

employee benefits.

1984 - Subsec. (a)(1)(B)(v). Pub. L. 98-369, Sec. 145(b)(1),

added cl. (v).

Subsec. (a)(1)(B)(vi). Pub. L. 98-369, Sec. 146(b)(1), added cl.

(vi).

Subsec. (a)(1)(B)(vii). Pub. L. 98-369, Sec. 148(b)(1), added cl.

(vii).

Subsec. (a)(1)(B)(viii). Pub. L. 98-369, Sec. 149(b)(1), added

cl. (viii).

Subsec. (a)(1)(B)(ix). Pub. L. 98-369, Sec. 155(b)(2)(A), added

cl. (ix).

Subsec. (a)(3)(A)(iii). Pub. L. 98-369, Sec. 148(b)(2),

substituted ", 6050I, or 6050J" for "or 6050I".

Pub. L. 98-369, Sec. 146(b)(2), substituted ", 6050H or 6050I"

for "or section 6050H".

Pub. L. 98-369, Sec. 145(b)(2), inserted "or section 6050H" after

"section 6041A(b)".

Subsec. (f). Pub. L. 98-611, Sec. 1(d)(2), and Pub. L. 98-612,

Sec. 1(b)(2), made identical amendments, substituting "6039D

(relating to returns and records with respect to certain fringe

benefit plans)" for "125(h) (relating to information with respect

to cafeteria plans)".

Pub. L. 98-369, Sec. 531(b)(4)(B)(i), which directed the

amendment of subsec. (f) by striking out "or 6047 (relating to

information relating to certain trusts and annuity and bond

purchase plans)" and inserting in lieu thereof ", 6047 (relating to

information relating to certain trusts and annuity and bond

purchase plans), or 125(h) (relating to information with respect to

cafeteria plans)", was executed by substituting the quoted phrase

for "or 6047 (relating to information relating to certain trusts

and annuity plans)", as the probable intent of Congress.

Pub. L. 98-369, Sec. 531(b)(4)(B)(ii), inserted "; etc." in

heading.

Pub. L. 98-369, Sec. 491(d)(50), struck out "and bond purchase"

after "trusts and annuity".

Subsec. (i). Pub. L. 98-369, Sec. 714(j)(3), added subsec. (i).

Former subsec. (i), relating to alcohol and tobacco taxes,

redesignated (j).

Subsec. (j). Pub. L. 98-397, Sec. 207(b), added subsec. (j).

Former subsec. (j), relating to alcohol and tobacco taxes,

redesignated (k).

Pub. L. 98-369, Sec. 714(j)(3), redesignated former subsec. (i),

relating to alcohol and tobacco taxes, as (j).

Subsec. (k). Pub. L. 98-397, Sec. 207(b), redesignated subsec.

(j), relating to alcohol and tobacco taxes, as (k).

1983 - Subsec. (a)(1)(A). Pub. L. 98-67, Sec. 105(b)(1)(B),

struck out cls. (ii), (iii), and (iv), redesignated cls. (v) and

(vi) as (ii) and (iii), respectively, and in cl. (iii), as so

redesignated, struck out "6042(e), 6044(f), 6049(e), or" before

"6051(d)".

Subsec. (a)(2), (3). Pub. L. 98-67, Sec. 105(b)(1)(A), (C), added

par. (2), redesignated former par. (2) as (3), and in par. (3), as

so redesignated, inserted references to paragraph (2) in provisions

preceding subpar. (A) and in provisions of subpar. (A) preceding

cl. (i).

Subsec. (a). Pub. L. 97-448, which directed that "or" be struck

out at end of subpar. (F) of par. (1), "or" be inserted at end of

par. (2), a new par. (3) be added, and that in provision following

par. (3), "paragraph (2) or (3)" be substituted for "paragraph

(2)", was executed by striking out "or" at end of subpar. (A)(vi)

of par. (1), inserting "or" at end of subpar. (B)(iv) of par. (1),

redesignating par. (3) as subpar. (C) and adding such subpar. (C),

to par. (1), and in provision following subpar. (C) substituting

"subparagraph (B) or (C)" for "subparagraph (B)", to reflect the

probable intent of Congress and the intervening amendment of

subsec. (a) by section 315(a) of Pub. L. 97-248 which redesignated

former par. (1) as subpar. (A), former subpars. (A) to (F) as cls.

(i) to (vi), and former par. (2) as subpar. (B), and in provision

following subpar. (B) as so redesignated, substituted "subparagraph

(B)" for "paragraph (2)".

1982 - Subsec. (a). Pub. L. 97-248, Sec. 315(a), designated

existing provisions as par. (1) with a heading "In general",

redesignated former par. (1) as subpar. (A), in subpar. (A) as so

redesignated struck out "aggregate" before "amount", redesignated

former subpars. (A) through (F) as cls. (i) through (vi),

respectively, in cls. (ii) and (iii) as so redesignated struck out

"aggregating $10 or more" after "dividends", in cl. (iv) as so

redesignated substituted "(a)" for "(a)(1)" and struck out

"aggregating $10 or more" after "interest", in cl. (vi) as so

redesignated inserted "6042(e), 6044(f), 6049(e), or" before

"6051(d)", redesignated former par. (2) as subpar. (B), in subpar.

(B) as so redesignated designated from "section 6052(a)" through

the end of the parenthesis as cl. (iii) and struck out "with

respect to group-term life insurance on the life of an employee"

thereafter, added cls. (i), (ii), and (iv), in text after cl. (iv)

substituted "subparagraph (A)" for "paragraph (1)", "subparagraph

(B)" for "paragraph (2)", "$50 for each such failure" for "$10 for

each such failure", and "shall not exceed $50,000" for "shall not

exceed $25,000", and added par. (2).

Subsec. (b). Pub. L. 97-248, Sec. 309(b)(2), struck out pars. (3)

and (4) which referred to section 6049(a)(2) and section

6049(a)(3), respectively, as sources of authority for the

requirement of filing a statement of payment to another person.

Subsec. (f). Pub. L. 97-248, Sec. 315(b), substituted "$25" and

"$15,000" for "$10" and "$5,000", respectively.

1981 - Subsec. (a). Pub. L. 97-34, Sec. 723(a)(4), inserted in

heading "information at source," before "payments of dividends".

Subsec. (a)(1). Pub. L. 97-34, Sec. 723(a)(1), added subpars.

(A), (E), and (F), and redesignated former subpars. (A) to (C) as

(B) to (D), respectively.

Subsec. (b). Pub. L. 97-34, Sec. 723(a)(3), substituted

provisions relating to failure to file required statement of

payment to another person under authority of section 6042(a)(2),

6044(a)(2), or 6049(a)(2) or (3), and imposition of penalties with

a maximum of $1,000 for all failures during the calendar year, for

provisions relating to failure to file required statement of

payment to another person under authority of section 6041,

6042(a)(2), 6044(a)(2), 6049(a)(2) or (3), 6050A(a) or (b), 6050C,

6051(d), or 6053(b), and imposition of penalties with a maximum of

$1,000 for all failures during the calendar year.

Subsecs. (h), (i). Pub. L. 97-34, Sec. 311(f), added subsec. (h)

and redesignated former subsec. (h) as (i).

1980 - Subsec. (b). Pub. L. 96-223 inserted reference to

statement required by section 6050C (relating to information

regarding windfall profit tax on crude oil).

Subsec. (d)(3). Pub. L. 96-603 substituted in heading "returns"

for "reports" and in text "failure to comply" for "failure to file

a report required under section 6056 (relating to annual reports by

private foundations) or to comply", "failing to meet such

requirements" for "failing so to file or meet the publicity

requirement", and "failure with respect" for "failure to file or

comply with the requirements of section 6104(d) with regard".

Subsecs. (g), (h). Pub. L. 96-499 added subsec. (g) and

redesignated former subsec. (g) as (h).

1979 - Subsec. (a). Pub. L. 96-167 inserted "or" after "$10 or

more)," in par. (1), struck out par. (2) relating to failure to

make a return required by section 6039(a) with respect to a

transfer of stock or a transfer of legal title to stock,

redesignated par. (3) as (2), and in closing provision substituted

"return referred to in paragraph (2)" for "return referred to in

paragraph (2) or (3)".

1976 - Subsec. (a). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck

out "or his delegate" after "Secretary".

Subsec. (b). Pub. L. 94-455, Secs. 1207(e)(3)(B), (C),

1906(b)(13)(A), inserted "in the case of each failure to make a

return required by section 6050A(a) (relating to reporting

requirements of certain fishing boat operators)," after "income tax

withheld)," and "or section 6050A(b) (relating to statements

furnished by certain fishing boat operators)," after "respect to

tips)," and struck out "or his delegate" after "Secretary".

Subsecs. (d) to (f). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck

out "or his delegate" after "Secretary" wherever appearing.

1974 - Pub. L. 93-406, Sec. 1031(b)(1)(B)(i), inserted ",

registration statements, etc." in section catchline.

Subsecs. (e) to (g). Pub. L. 93-406, Sec. 1031(b)(1)(A), added

subsecs. (e) and (f) and redesignated former subsec. (e) as (g).

1969 - Subsecs. (d), (e). Pub. L. 91-172 added subsec. (d) and

redesignated former subsec. (d) as (e).

1965 - Subsec. (b). Pub. L. 89-97, Sec. 313(e)(2)(B), inserted

"and in the case of each failure to furnish a statement required by

section 6053(b) (relating to statements furnished by employers with

respect to tips)," after "income tax withheld).".

Subsec. (c). Pub. L. 89-212 inserted "or which are compensation

(as defined in section 3231(e))" and "or section 3201 (as the case

may be)".

Pub. L. 89-97, Sec. 313(e)(3), added subsec. (c). Former subsec.

(c) redesignated (d).

Subsec. (d). Pub. L. 89-97, Sec. 313(e)(3), redesignated former

subsec. (c) as (d).

1964 - Subsec. (a). Pub. L. 88-272 provided a penalty for failure

to make a return required by section 6039(a) with respect to a

transfer of stock or a transfer of legal title to stock, and by

section 6052(a) with respect to group-term life insurance on the

life of an employee.

1962 - Subsec. (a). Pub. L. 87-834 added subsec. (a). Former

subsec. (a) redesignated (b).

Subsec. (b). Pub. L. 87-834 redesignated former subsec. (a) as

(b), and substituted "section 6042(a)(2) (relating to payments of

dividends aggregating less than $10), section 6044(a)(2) (relating

to payments of patronage dividends aggregating less than $10),

section 6049(a)(2) (relating to payments of interest aggregating

less than $10), section 6049(a)(3) (relating to other payments of

interest by corporations), or section 6051(d) (relating to

information returns with respect to income tax withheld)" for

"section 6042(1) (relating to payments of corporate dividends),

section 6044 (relating to patronage dividends), or section 6051(d)

(relating to information returns with respect to income tax

withheld)". Former subsec. (b) redesignated (c).

Subsec. (c). Pub. L. 87-834 redesignated former subsec. (b) as

(c).

1958 - Subsec. (a). Pub. L. 85-866 substituted "section 6042(1)"

for "section 6042" and "(upon notice and demand by the Secretary or

his delegate and in the same manner as tax), by the person failing

to so file the statement, $1 for each such statement not so filed"

for "by the person failing to file the statement, upon notice and

demand by the Secretary or his delegate and in the same manner as

tax, $1 for each such statement not filed", deleted "section 6045

(relating to returns of brokers)" after "patronage dividends)" and

inserted "on the date prescribed therefor (determined with regard

to any extension of time for filing)" after "income tax

withheld),".

EFFECTIVE DATE OF 2000 AMENDMENT

Amendment by section 1(c) of Pub. L. 106-230 effective July 1,

2000, see section 1(d) of Pub. L. 106-230, set out as a note under

section 527 of this title.

Amendment by section 3(c) of Pub. L. 106-230 applicable to

returns for taxable years beginning after June 30, 2000, see

section 3(d) of Pub. L. 106-230, set out as a note under section

6012 of this title.

EFFECTIVE DATE OF 1998 AMENDMENT

Amendment by Pub. L. 105-277 applicable to requests made after

the later of Dec. 31, 1998, or the 60th day after the Secretary of

the Treasury first issues the regulations referred to in section

6104(d)(4) of this title, see section 1004(b)(3) of Pub. L.

105-277, set out as a note under section 6104 of this title.

EFFECTIVE DATE OF 1997 AMENDMENT

Section 1281(e) of Pub. L. 105-34 provided that: "The amendments

made by this section [amending this section and sections 6683 and

7519 of this title] shall apply to taxable years beginning after

the date of the enactment of this Act [Aug. 5, 1997]."

Amendment by section 1602(d)(2)(B) of Pub. L. 105-34 effective as

if included in the provisions of the Health Insurance Portability

and Accountability Act of 1996, Pub. L. 104-191, to which such

amendment relates, see section 1602(i) of Pub. L. 105-34, set out

as a note under section 26 of this title.

EFFECTIVE DATE OF 1996 AMENDMENTS

Amendment by section 1455(c), (d)(2) of Pub. L. 104-188

applicable to returns, reports, and other statements the due date

for which (determined without regard to extensions) is after Dec.

31, 1996, see section 1455(e) of Pub. L. 104-188, set out as a note

under section 408 of this title.

Section 1314(c) of Pub. L. 104-168 provided that: "The amendments

made by this section [amending this section] shall apply to returns

for taxable years ending on or after the date of the enactment of

this Act [July 30, 1996]."

EFFECTIVE DATE OF 1993 AMENDMENT

Amendment by Pub. L. 103-66 applicable to stock issued after Aug.

10, 1993, see section 13113(e) of Pub. L. 103-66, set out as a note

under section 53 of this title.

EFFECTIVE DATE OF 1992 AMENDMENT

Amendment by Pub. L. 102-318 applicable, except as otherwise

provided, to distributions after Dec. 31, 1992, see section 522(d)

of Pub. L. 102-318, set out as a note under section 401 of this

title.

EFFECTIVE DATE OF 1989 AMENDMENTS

Amendment by section 7208(b)(2) of Pub. L. 101-239 applicable to

transactions after Mar. 31, 1990, see section 7208(b)(4) of Pub. L.

101-239, set out as a note under section 6043 of this title.

Amendment by Pub. L. 101-140 effective as if included in section

1151 of Pub. L. 99-514, see section 203(c) of Pub. L. 101-140, set

out as a note under section 79 of this title.

EFFECTIVE DATE OF 1988 AMENDMENT

Amendment by sections 1011B(a)(10), 1017(b), 1018(u)(36) of Pub.

L. 100-647 effective, except as otherwise provided, as if included

in the provision of the Tax Reform Act of 1986, Pub. L. 99-514, to

which such amendment relates, see section 1019(a) of Pub. L.

100-647, set out as a note under section 1 of this title.

Amendment by section 3021(a)(10) of Pub. L. 100-647 effective as

if included in the amendments by section 1151 of Pub. L. 99-514,

see section 3021(d)(1) of Pub. L. 100-647, set out as a note under

section 129 of this title.

EFFECTIVE DATE OF 1987 AMENDMENT

Amendment by section 10502(d)(11) of Pub. L. 100-203 applicable

to sales after Mar. 31, 1988, see section 10502(e) of Pub. L.

100-203, set out as a note under section 40 of this title.

Section 10704(d) of Pub. L. 100-203 provided that: "The

amendments made by this section [amending this section and sections

6685 and 7207 of this title] shall apply -

"(1) to returns for years beginning after December 31, 1986,

and

"(2) on and after the date of the enactment of this Act [Dec.

22, 1987] in the case of applications submitted to the Internal

Revenue Service -

"(A) after July 15, 1987, or

"(B) on or before July 15, 1987, if the organization has a

copy of the application on July 15, 1987."

EFFECTIVE DATE OF 1986 AMENDMENT

Amendment by section 1151(b) of Pub. L. 99-514 applicable to

years beginning after Dec. 31, 1988, with certain qualifications

and exceptions, see section 1151(k) of Pub. L. 99-514, as amended,

set out as a note under section 79 of this title.

Amendment by section 1301(g) of Pub. L. 99-514 applicable to

bonds issued after Aug. 15, 1986, except as otherwise provided, see

sections 1311 to 1318 of Pub. L. 99-514, set out as an Effective

Date; Transitional Rules note under section 141 of this title.

Amendment by section 1501(d)(1)(A) of Pub. L. 99-514 applicable

to returns the due date for which (determined without regard to

extensions) is after Dec. 31, 1986, see section 1501(e) of Pub. L.

99-514, set out as an Effective Date note under section 6721 of

this title.

Amendment by section 1702(b) of Pub. L. 99-514 applicable to

sales after first calendar quarter beginning more than 60 days

after Oct. 22, 1986, see section 1702(c) of Pub. L. 99-514, set out

as a note under section 4041 of this title.

Amendment by sections 1810(f)(9) and 1811(c)(2) of Pub. L. 99-514

effective, except as otherwise provided, as if included in the

provisions of the Tax Reform Act of 1984, Pub. L. 98-369, div. A,

to which such amendment relates, see section 1881 of Pub. L.

99-514, set out as a note under section 48 of this title.

EFFECTIVE DATE OF 1984 AMENDMENTS

Amendment by Pub. L. 98-612 effective Jan. 1, 1985, see section

1(d)(2) of Pub. L. 98-612.

Amendment by Pub. L. 98-611 effective Jan. 1, 1985, see section

1(g)(2) of Pub. L. 98-611, set out as a note under section 127 of

this title.

Amendment by Pub. L. 98-397 applicable to distributions after

Dec. 31, 1984, see section 302(c) of Pub. L. 98-397, set out as a

note under section 1001 of Title 29, Labor.

Amendment by section 145(b)(1), (2) of Pub. L. 98-369 applicable

to amounts received after Dec. 31, 1984, see section 145(d) of Pub.

L. 98-369, set out as an Effective Date note under section 6050H of

this title.

Amendment by section 146(b)(1), (2) of Pub. L. 98-369 applicable

to amounts received after Dec. 31, 1984, see section 146(d) of Pub.

L. 98-369, set out as an Effective Date note under section 6050I of

this title.

Amendment by section 148(b)(1), (2) of Pub. L. 98-369 applicable

with respect to acquisitions of property and abandonments of

property after Dec. 31, 1984, see section 148(d) of Pub. L. 98-369,

set out as an Effective Date note under section 6050J of this

title.

Amendment by section 149(b)(1) of Pub. L. 98-369 applicable with

respect to exchanges after Dec. 31, 1984, see section 149(d) of

Pub. L. 98-369, set out as an Effective Date note under section

6050K of this title.

Amendment by section 155(b)(2)(A) of Pub. L. 98-369 applicable to

contributions made after Dec. 31, 1984, in taxable years ending

after such date, see section 155(d)(1) of Pub. L. 98-369, set out

as an Effective Date note under section 6050L of this title.

Amendment by section 491(d)(50) of Pub. L. 98-369 applicable to

obligations issued after Dec. 31, 1983, see section 491(f)(1) of

Pub. L. 98-369, set out as a note under section 62 of this title.

Amendment by section 531(b)(4)(B) of Pub. L. 98-369 effective

Jan. 1, 1985, see section 531(h) of Pub. L. 98-369, set out as an

Effective Date note under section 132 of this title.

Amendment by section 714(j)(3) of Pub. L. 98-369 effective as if

included in the provision of the Tax Equity and Fiscal

Responsibility Act of 1982, Pub. L. 97-248, to which such amendment

relates, see section 715 of Pub. L. 98-369, set out as a note under

section 31 of this title.

EFFECTIVE DATE OF 1983 AMENDMENTS

Amendment by Pub. L. 98-67 applicable with respect to payments

made after Dec. 31, 1983, see section 110(a) of Pub. L. 98-67, set

out as a note under section 31 of this title.

Section 203(a), (b) of title II of Pub. L. 97-448, as amended by

Pub. L. 99-514, Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided

that:

"(a) General Rule. - Except as provided in subsection (b), any

amendment made by this title [amending this section and sections

44D [now 29], 46, 48, 193, 613A, 4988, 4989, 4991-4997, 6015, 6154,

6654, 6655, and 6678 of this title, enacting provisions set out as

notes under section 4996 of this title, and amending a provision

set out as a note under section 44E of this title] shall take

effect as if it had been included in the provision of the Crude Oil

Windfall Profit Tax Act of 1980 [Pub. L. 96-223] to which such

amendment relates.

"(b) Exceptions. -

"(1) Definition of independent producer. - The amendment made

by section 201(d)(1) [amending section 4992 of this title] shall

take effect on January 1, 1983.

"(2) Penalty provision. - The amendments made by section 201(i)

[amending this section and sections 4997 and 6678 of this title]

shall apply with respect to returns and statements the due dates

for which (without regard to extensions) are after the date of

the enactment of this Act [Jan. 12, 1983].

"(3) Amendments to section 613a. -

"(A) The amendment made by section 202(d)(1) [amending

section 613A of this title] shall apply to transfers in taxable

years ending after December 31, 1974, but only for purposes of

applying section 613A of the Internal Revenue Code of 1986

[formerly I.R.C. 1954] to periods after December 31, 1979.

"(B) The amendment made by section 202(d)(2) [amending

section 613A of this title] shall apply to bulk sales after

September 18, 1982.

"(4) No withholding by reason of condensate provision. - No

withholding of tax shall be required under section 4995 of the

Internal Revenue Code of 1986 by reason of the amendment made by

section 201(h)(2)(A) of this Act [amending section 4996 of this

title] before the date on which regulations with respect to such

amendment are published in the Federal Register."

EFFECTIVE DATE OF 1982 AMENDMENT

Amendment by section 309(b)(2) of Pub. L. 97-248 applicable to

amounts paid (or treated as paid) after Dec. 31, 1982, see section

309(c) of Pub. L. 97-248, set out as a note under section 6049 of

this title.

Section 315(d) of Pub. L. 97-248 provided that: "The amendments

made by this section [amending this section and section 6678 of

this title] shall apply with respect to returns or statements the

due date for the filing of which (without regard to extensions) is

after December 31, 1982."

EFFECTIVE DATE OF 1981 AMENDMENT

Amendment by section 311(f) of Pub. L. 97-34 applicable to

taxable years beginning after Dec. 31, 1981, see section 311(i)(1)

of Pub. L. 97-34, set out as a note under section 219 of this

title.

Section 723(c) of Pub. L. 97-34 provided that: "The amendments

made by this section [amending this section and sections 6041 and

6678 of this title] shall apply to returns and statements required

to be furnished after December 31, 1981."

EFFECTIVE DATE OF 1980 AMENDMENTS

Amendment by Pub. L. 96-603 applicable to taxable years beginning

after Dec. 31, 1980, see section 1(f) of Pub. L. 96-603, set out as

a note under section 6033 of this title.

Amendment by Pub. L. 96-499, applicable to 1980 and subsequent

calendar years, with 1980 being treated as beginning on June 19,

1980, and ending on Dec. 31, 1980, see section 1125(b) of Pub. L.

96-499, set out as an Effective Date note under section 897 of this

title.

Amendment by Pub. L. 96-223 applicable to periods after Feb. 29,

1980, see section 101(i) of Pub. L. 96-223, set out as a note under

section 6161 of this title.

EFFECTIVE DATE OF 1979 AMENDMENT

Section 7(c) of Pub. L. 96-167 provided that: "The amendments

made by this section [amending this section and sections 6039 and

6678 of this title] shall apply with respect to calendar years

beginning after 1979."

EFFECTIVE DATE OF 1976 AMENDMENT

Amendment by section 1207(e)(3)(B), (C) of Pub. L. 94-455

applicable to calendar years beginning after Oct. 4, 1976, see

section 1207(f)(4) of Pub. L. 94-455, set out as a note under

section 3121 of this title.

EFFECTIVE DATE OF 1974 AMENDMENT

Amendment by Pub. L. 93-406 effective Sept. 2, 1974, see section

1034 of Pub. L. 93-406, set out as an Effective Date note under

section 6057 of this title.

EFFECTIVE DATE OF 1969 AMENDMENT

Amendment by Pub. L. 91-172 applicable to taxable years beginning

after Dec. 31, 1969, see section 101(k)(2)(B) of Pub. L. 91-172,

set out as an Effective Date note under section 4940 of this title.

EFFECTIVE DATE OF 1965 AMENDMENTS

Amendment by Pub. L. 89-212 effective only with respect to tips

received after 1965, see section 6 of Pub. L. 89-212, set out as a

note under section 3201 of this title.

Amendment by Pub. L. 89-97 applicable only with respect to tips

received by employees after 1965, see section 313(f) of Pub. L.

89-97, set out as an Effective Date note under section 6053 of this

title.

EFFECTIVE DATE OF 1964 AMENDMENT

Amendment by Pub. L. 88-272 applicable to group-term life

insurance provided after Dec. 31, 1963, in taxable years ending

after such date, see section 204(d) of Pub. L. 88-272, set out as

an Effective Date note under section 79 of this title.

Amendment by Pub. L. 88-272 applicable to taxable years ending

after Dec. 31, 1963, except for par. (2) of subsec. (a) which shall

apply to stock transferred pursuant to options exercised on or

after Jan. 1, 1964, see section 221(e) of Pub. L. 88-272, set out

as a note under section 421 of this title.

EFFECTIVE DATE OF 1962 AMENDMENT

Amendment by Pub. L. 87-834 applicable to payments of dividends

and interest made on or after Jan. 1, 1963, and to payments of

amounts described in section 6044(b) of this title made on or after

Jan. 1, 1963, with respect to patronage occurring on or after the

first day of the first taxable year of the cooperative beginning on

or after Jan. 1, 1963, see section 19(h) of Pub. L. 87-834, set out

as a note under section 6042 of this title.

EFFECTIVE DATE OF 1958 AMENDMENT

Amendment by Pub. L. 85-866 effective Aug. 17, 1954, see section

1(c)(2) of Pub. L. 85-866, set out as a note under section 165 of

this title.

NONENFORCEMENT OF AMENDMENT MADE BY SECTION 1151 OF PUB. L. 99-514

FOR FISCAL YEAR 1990

No monies appropriated by Pub. L. 101-136 to be used to implement

or enforce section 1151 of Pub. L. 99-514 or the amendments made by

such section, see section 528 of Pub. L. 101-136, set out as a note

under section 89 of this title.

PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1998

For provisions directing that if any amendments made by subtitle

D [Secs. 1401-1465] of title I of Pub. L. 104-188 require an

amendment to any plan or annuity contract, such amendment shall not

be required to be made before the first day of the first plan year

beginning on or after Jan. 1, 1998, see section 1465 of Pub. L.

104-188, set out as a note under section 401 of this title.

PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1994

For provisions directing that if any amendments made by subtitle

B [Secs. 521-523] of title V of Pub. L. 102-318 require an

amendment to any plan, such plan amendment shall not be required to

be made before the first plan year beginning on or after Jan. 1,

1994, see section 523 of Pub. L. 102-318, set out as a note under

section 401 of this title.

PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989

For provisions directing that if any amendments made by subtitle

A or subtitle C of title XI [Secs. 1101-1147 and 1171-1177] or

title XVIII [Secs. 1800-1899A] of Pub. L. 99-514 require an

amendment to any plan, such plan amendment shall not be required to

be made before the first plan year beginning on or after Jan. 1,

1989, see section 1140 of Pub. L. 99-514, as amended, set out as a

note under section 401 of this title.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 42, 142, 219, 527, 6033,

6034, 6047, 6057, 6058 of this title.

-FOOTNOTE-

(!1) See 1993 Amendment note below.

-End-

-CITE-

26 USC Sec. 6653 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6653. Failure to pay stamp tax

-STATUTE-

Any person (as defined in section 6671(b)) who -

(1) willfully fails to pay any tax imposed by this title which

is payable by stamp, coupons, tickets, books, or other devices or

methods prescribed by this title or by regulations under the

authority of this title, or

(2) willfully attempts in any manner to evade or defeat any

such tax or the payment thereof,

shall, in addition to other penalties provided by law, be liable

for a penalty of 50 percent of the total amount of the underpayment

of the tax.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 822; Pub. L. 85-866, title I,

Sec. 86, Sept. 2, 1958, 72 Stat. 1665; Pub. L. 91-172, title I,

Sec. 101(j)(50), title IX, Sec. 943(c)(6), Dec. 30, 1969, 83 Stat.

531, 729; Pub. L. 91-679, Sec. 2, Jan. 12, 1971, 84 Stat. 2063;

Pub. L. 93-406, title II, Sec. 1016(a)(18), Sept. 2, 1974, 88 Stat.

931; Pub. L. 96-223, title I, Sec. 101(f)(8), Apr. 2, 1980, 94

Stat. 253; Pub. L. 97-34, title V, Sec. 501(b), title VII, Sec.

722(b)(1), Aug. 13, 1981, 95 Stat. 326, 342; Pub. L. 97-248, title

III, Sec. 325(a), Sept. 3, 1982, 96 Stat. 616; Pub. L. 97-448,

title I, Secs. 105(a)(1)(D), 107(a)(3), Jan. 12, 1983, 96 Stat.

2384, 2391; Pub. L. 98-67, title I, Sec. 106, Aug. 5, 1983, 97

Stat. 382; Pub. L. 98-369, div. A, title I, Sec. 179(b)(3), July

18, 1984, 98 Stat. 718; Pub. L. 99-44, Sec. 1(b), May 24, 1985, 99

Stat. 77; Pub. L. 99-514, title XV, Sec. 1503(a), (b), (c)(2), (3),

(d)(1), Oct. 22, 1986, 100 Stat. 2742, 2743; Pub. L. 100-647, title

I, Sec. 1015(b)(2)(A), (B), (3), Nov. 10, 1988, 102 Stat. 3569;

Pub. L. 101-239, title VII, Sec. 7721(c)(1), Dec. 19, 1989, 103

Stat. 2399.)

-MISC1-

AMENDMENTS

1989 - Pub. L. 101-239 substituted "Failure to pay stamp tax" for

"Additions to tax for negligence and fraud" in section catchline

and amended text generally, substituting a single par. for former

subsecs. (a) to (g).

1988 - Subsec. (a)(1). Pub. L. 100-647, Sec. 1015(b)(2)(A),

amended par. (1) generally. Prior to amendment, par. (1) read as

follows: "If any part of any underpayment (as defined in subsection

(c)) is due to negligence or disregard of rules or regulations,

there shall be added to the tax an amount equal to the sum of -

"(A) 5 percent of the underpayment, and

"(B) an amount equal to 50 percent of the interest payable

under section 6601 with respect to the portion of such

underpayment which is attributable to negligence for the period

beginning on the last date prescribed by law for payment of such

underpayment (determined without regard to any extension) and

ending on the date of the assessment of the tax (or, if earlier,

the date of the payment of the tax)."

Subsec. (b)(1). Pub. L. 100-647, Sec. 1015(b)(2)(B), amended par.

(1) generally. Prior to amendment, par. (1) read as follows: "If

any part of any underpayment (as defined in subsection (c)) of tax

required to be shown on a return is due to fraud, there shall be

added to the tax an amount equal to the sum of -

"(A) 75 percent of the portion of the underpayment which is

attributable to fraud, and

"(B) an amount equal to 50 percent of the interest payable

under section 6601 with respect to such portion for the period

beginning on the last day prescribed by law for payment of such

underpayment (determined without regard to any extension) and

ending on the date of the assessment of the tax or, if earlier,

the date of the payment of the tax."

Subsec. (g). Pub. L. 100-647, Sec. 1015(b)(3), inserted at end

"If any penalty is imposed under subsection (a) by reason of the

preceding sentence, only the portion of the underpayment which is

attributable to the failure described in the preceding sentence

shall be taken into account in determining the amount of the

penalty under subsection (a)."

1986 - Pub. L. 99-514, Sec. 1503(d)(1), substituted "Additions to

tax for negligence and fraud" for "Failure to pay tax" in section

catchline.

Subsec. (a). Pub. L. 99-514, Sec. 1503(a), added subsec. (a) and

struck out former subsec. (a) which added percentage to tax due for

underpayment of taxes where negligence or intentional disregard of

rules and regulations with respect to income, gift, or windfall

profit taxes was involved, and also provided additional interest

penalty for portion of underpayment attributable to negligence,

etc.

Subsec. (b). Pub. L. 99-514, Sec. 1503(b), added subsec. (b) and

struck out former subsec. (b) which added percentage to tax due for

underpayment of taxes where fraud was involved, and also provided

for additional interest penalty, but stated that there would be no

negligence addition where there was addition for fraud, and

concluded with special rule for joint returns.

Subsec. (d). Pub. L. 99-514, Sec. 1503(c)(2), substituted

"portion of the underpayment which is attributable to fraud" for

"same underpayment".

Subsec. (f). Pub. L. 99-514, Sec. 1503(c)(3), struck out "or

intentional disregard of rules and regulations (but without intent

to defraud)" after "underpayment due to negligence".

Subsec. (g). Pub. L. 99-514, Sec. 1503(b), amended subsec. (g)

generally, substituting provisions relating to special rule for

amounts shown on information returns for provisions relating to

special rule in case of interest or dividend payments, and struck

out provision that penalty was to apply only to portion of

underpayment due to failure to include interest or dividend

payment.

1985 - Subsec. (h). Pub. L. 99-44 repealed Pub. L. 98-369, Sec.

179(b)(3), which added subsec. (h), and provided that the Internal

Revenue Code of 1954 [now 1986] [this title] shall be applied and

administered as if section 179(b)(3) (and the amendments made by

such section) had not been enacted. See 1984 Amendment note and

Effective Date of 1985 Amendment note below.

1984 - Subsec. (h). Pub. L. 98-369 added subsec. (h) which

provided for a special rule in the case of underpayment

attributable to failure to meet the substantiation requirements of

section 274(d) of this title. See 1985 Amendment note above.

1983 - Subsec. (a)(2)(B). Pub. L. 97-448, Sec. 107(a)(3),

inserted "(or, if earlier, the date of the payment of the tax)"

after "assessment of the tax".

Subsec. (f). Pub. L. 97-448, Sec. 105(a)(1)(D), redesignated

subsec. (g), added by Pub. L. 97-34, as (f) and substituted

"unrecognized gain" for "unrealized gain" in heading.

Subsec. (g). Pub. L. 98-67 added subsec. (g).

Pub. L. 97-448, Sec. 105(a)(1)(D), redesignated subsec. (g),

added by Pub. L. 97-34, as (f).

1982 - Subsec. (b). Pub. L. 97-248 designated first sentence of

existing provisions as par. (1) with heading "In general", struck

out second sentence which provided that in the case of income taxes

and gift taxes, the amount under this subsec. shall be in lieu of

any amount determined under subsec. (a), added pars. (2) and (3),

designated last sentence as par. (4) with heading "Special rule for

joint returns", and in par. (4) as so designated substituted "of

the spouse" for "of a spouse".

1981 - Subsec. (a). Pub. L. 97-34, Sec. 722(b)(1), designated

existing provisions as par. (1), inserted heading, struck out

"(relating to income taxes and gift taxes)", and added par. (2)

after "subtitle B".

Subsec. (g). Pub. L. 97-34, Sec. 501(b), added subsec. (g).

1980 - Subsec. (a). Pub. L. 96-223 substituted ", gift, or

windfall profit taxes" for "or gift taxes" in heading, and in text

substituted "," for "or" before "by chapter 12" and inserted ", or

by chapter 45 (relating to windfall profit tax)" before "is due to

negligence".

1974 - Subsec. (c)(1). Pub. L. 93-406 substituted "certain

excise" for "chapter 42" in heading and text.

1971 - Subsec. (b). Pub. L. 91-679 inserted sentence making

subsection inapplicable, in the case of a joint return under

section 6013 of this title, with respect to the tax of a spouse

unless some part of the underpayment is due to the fraud of such

spouse.

1969 - Subsec. (c)(1). Pub. L. 91-172, Sec. 101(j)(50), inserted

reference to chapter 42 taxes in heading and text.

Subsec. (d). Pub. L. 91-172, Sec. 943(c)(6), inserted "or pay

tax" after "such return".

1958 - Subsec. (c)(1). Pub. L. 85-866, inserted "on or" after

"such return was filed".

EFFECTIVE DATE OF 1989 AMENDMENT

Amendment by Pub. L. 101-239 applicable to returns the due date

for which (determined without regard to extensions) is after Dec.

31, 1989, see section 7721(d) of Pub. L. 101-239, set out as a note

under section 461 of this title.

EFFECTIVE DATE OF 1988 AMENDMENT

Amendment by section 1015(b)(2)(A), (B) of Pub. L. 100-647

applicable to returns the due date for which (determined without

regard to extensions) is after Dec. 31, 1988, see section

1015(b)(4) of Pub. L. 100-647, set out as a note under section 6013

of this title.

Amendment by section 1015(b)(3) of Pub. L. 100-647 effective,

except as otherwise provided, as if included in the provision of

the Tax Reform Act of 1986, Pub. L. 99-514, to which such amendment

relates, see section 1019(a) of Pub. L. 100-647, set out as a note

under section 1 of this title.

EFFECTIVE DATE OF 1986 AMENDMENT

Section 1503(e) of Pub. L. 99-514 provided that: "The amendments

made by this section [amending this section and section 6222 of

this title] shall apply to returns the due date for which

(determined without regard to extensions) is after December 31,

1986."

EFFECTIVE DATE OF 1985 AMENDMENT

Amendment by Pub. L. 99-44 effective as if included in the

amendments made by section 179(b) of Pub. L. 98-369, see section

6(a) of Pub. L. 99-44, set out as a note under section 274 of this

title.

EFFECTIVE DATE OF 1984 AMENDMENT

Amendment by Pub. L. 98-369 applicable to taxable years beginning

after Dec. 31, 1984, see section 179(d)(2) of Pub. L. 98-369, set

out as an Effective Date note under section 280F of this title.

EFFECTIVE DATE OF 1983 AMENDMENTS

Amendment by Pub. L. 98-67 applicable with respect to payments

made after Dec. 31, 1983, see section 110(a) of Pub. L. 98-67, set

out as a note under section 31 of this title.

Amendment by Pub. L. 97-448 effective, except as otherwise

provided, as if it had been included in the provision of the

Economic Recovery Tax Act of 1981, Pub. L. 97-34, to which such

amendment relates, see section 109 of Pub. L. 97-448, set out as a

note under section 1 of this title.

EFFECTIVE DATE OF 1982 AMENDMENT

Section 325(b) of Pub. L. 97-248 provided that: "The amendment

made by subsection (a) [amending this section] shall apply with

respect to taxes the last day prescribed by law for payment of

which (determined without regard to any extension) is after the

date of enactment of this Act [Sept. 3, 1982]."

EFFECTIVE DATE OF 1981 AMENDMENT

Amendment by section 501(b) of Pub. L. 97-34 applicable to

property acquired and positions established by the taxpayer after

June 23, 1981, in taxable years ending after such date, and

applicable when so elected with respect to property held on June

23, 1981, see section 508 of Pub. L. 97-34, set out as an Effective

Date note under section 1092 of this title.

Section 722(b)(2) of Pub. L. 97-34 provided that: "The amendment

made by paragraph (1) [amending this section] shall apply to taxes

the last date prescribed for payment of which is after December 31,

1981."

EFFECTIVE DATE OF 1980 AMENDMENT

Amendment by Pub. L. 96-223 applicable to periods after Feb. 29,

1980, see section 101(i) of Pub. L. 96-223, set out as a note under

section 6161 of this title.

EFFECTIVE DATE OF 1974 AMENDMENT

Amendment by Pub. L. 93-406 applicable, except as otherwise

provided in section 1017(c) through (i) of Pub. L. 93-406, for plan

years beginning after Sept. 2, 1974, but, in the case of plans in

existence on Jan. 1, 1974, amendment by Pub. L. 93-406 applicable

for plan years beginning after Dec. 31, 1975, see section 1017 of

Pub. L. 93-406, set out as an Effective Date; Transitional Rules

note under section 410 of this title.

EFFECTIVE DATE OF 1971 AMENDMENT

Amendment by Pub. L. 91-679 applicable to all taxable years to

which this title applies, see section 3 of Pub. L. 91-679, set out

as a note under section 6013 of this title.

EFFECTIVE DATE OF 1969 AMENDMENT

Amendment by section 101(j)(50) of Pub. L. 91-172 effective Jan.

1, 1970, see section 101(k)(1) of Pub. L. 91-172, set out as an

Effective Date note under section 4940 of this title.

Amendment by section 943(c)(6) of Pub. L. 91-172 applicable with

respect to tax returns the date prescribed by law for filing of

which is after Dec. 31, 1969, see section 943(d) of Pub. L. 91-172,

set out as a note under section 6651 of this title.

EFFECTIVE DATE OF 1958 AMENDMENT

Amendment by Pub. L. 85-866 effective Aug. 17, 1954, see section

1(c)(2) of Pub. L. 85-866, set out as a note under section 165 of

this title.

REPEAL OF REGULATIONS COVERING SUBSTANTIATION BY ADEQUATE

CONTEMPORANEOUS RECORDS

Regulations issued before May 24, 1985, to carry out subsec. (h)

of this section as added by section 179(b)(3) of Pub. L. 98-369 to

have no force and effect, see section 1(c) of Pub. L. 99-44, set

out as a note under section 274 of this title.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 5684, 5761, 6601, 6672 of

this title.

-End-

-CITE-

26 USC Sec. 6654 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6654. Failure by individual to pay estimated income tax

-STATUTE-

(a) Addition to the tax

Except as otherwise provided in this section, in the case of any

underpayment of estimated tax by an individual, there shall be

added to the tax under chapter 1 and the tax under chapter 2 for

the taxable year an amount determined by applying -

(1) the underpayment rate established under section 6621,

(2) to the amount of the underpayment,

(3) for the period of the underpayment.

(b) Amount of underpayment; period of underpayment

For purposes of subsection (a) -

(1) Amount

The amount of the underpayment shall be the excess of -

(A) the required installment, over

(B) the amount (if any) of the installment paid on or before

the due date for the installment.

(2) Period of underpayment

The period of the underpayment shall run from the due date for

the installment to whichever of the following dates is the

earlier -

(A) the 15th day of the 4th month following the close of the

taxable year, or

(B) with respect to any portion of the underpayment, the date

on which such portion is paid.

(3) Order of crediting payments

For purposes of paragraph (2)(B), a payment of estimated tax

shall be credited against unpaid required installments in the

order in which such installments are required to be paid.

(c) Number of required installments; due dates

For purposes of this section -

(1) Payable in 4 installments

There shall be 4 required installments for each taxable year.

(2) Time for payment of installments

In the case of the following T2The due date is:

required installments:

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

1st April 15

2nd June 15

3rd September 15

4th January 15 of the

following taxable year.

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

(d) Amount of required installments

For purposes of this section -

(1) Amount

(A) In general

Except as provided in paragraph (2), the amount of any

required installment shall be 25 percent of the required annual

payment.

(B) Required annual payment

For purposes of subparagraph (A), the term "required annual

payment" means the lesser of -

(i) 90 percent of the tax shown on the return for the

taxable year (or, if no return is filed, 90 percent of the

tax for such year), or

(ii) 100 percent of the tax shown on the return of the

individual for the preceding taxable year.

Clause (ii) shall not apply if the preceding taxable year was

not a taxable year of 12 months or if the individual did not

file a return for such preceding taxable year.

(C) Limitation on use of preceding year's tax

(i) In general

If the adjusted gross income shown on the return of the

individual for the preceding taxable year beginning in any

calendar year exceeds $150,000, clause (ii) of subparagraph

(B) shall be applied by substituting the applicable

percentage for "100 percent". For purposes of the preceding

sentence, the applicable percentage shall be determined in

accordance with the following table:

The

If the preceding taxable applicable

year begins in: percentage is:

1998 105

1999 108.6

2000 110

2001 112

2002 or thereafter 110.

This clause shall not apply in the case of a preceding

taxable year beginning in calendar year 1997.

(ii) Separate returns

In the case of a married individual (within the meaning of

section 7703) who files a separate return for the taxable

year for which the amount of the installment is being

determined, clause (i) shall be applied by substituting

"$75,000" for "$150,000".

(iii) Special rule

In the case of an estate or trust, adjusted gross income

shall be determined as provided in section 67(e).

(2) Lower required installment where annualized income

installment is less than amount determined under paragraph (1)

(A) In general

In the case of any required installment, if the individual

establishes that the annualized income installment is less than

the amount determined under paragraph (1) -

(i) the amount of such required installment shall be the

annualized income installment, and

(ii) any reduction in a required installment resulting from

the application of this subparagraph shall be recaptured by

increasing the amount of the next required installment

determined under paragraph (1) by the amount of such

reduction (and by increasing subsequent required installments

to the extent that the reduction has not previously been

recaptured under this clause).

(B) Determination of annualized income installment

In the case of any required installment, the annualized

income installment is the excess (if any) of -

(i) an amount equal to the applicable percentage of the tax

for the taxable year computed by placing on an annualized

basis the taxable income, alternative minimum taxable income,

and adjusted self-employment income for months in the taxable

year ending before the due date for the installment, over

(ii) the aggregate amount of any prior required

installments for the taxable year.

(C) Special rules

For purposes of this paragraph -

(i) Annualization

The taxable income, alternative minimum taxable income, and

adjusted self-employment income shall be placed on an

annualized basis under regulations prescribed by the

Secretary.

(ii) Applicable percentage

In the case of the following The applicable

required installments: percentage is:

1st 22.5

2nd 45

3rd 67.5

4th 90.

(iii) Adjusted self-employment income

The term "adjusted self-employment income" means

self-employment income (as defined in section 1402(b));

except that section 1402(b) shall be applied by placing wages

(within the meaning of section 1402(b)) for months in the

taxable year ending before the due date for the installment

on an annualized basis consistent with clause (i).

(D) Treatment of subpart F and section 936 income

(i) In general

Any amounts required to be included in gross income under

section 936(h) or 951(a) (and credits properly allocable

thereto) shall be taken into account in computing any

annualized income installment under subparagraph (B) in a

manner similar to the manner under which partnership income

inclusions (and credits properly allocable thereto) are taken

into account.

(ii) Prior year safe harbor

If a taxpayer elects to have this clause apply to any

taxable year -

(I) clause (i) shall not apply, and

(II) for purposes of computing any annualized income

installment for such taxable year, the taxpayer shall be

treated as having received ratably during such taxable year

items of income and credit described in clause (i) in an

amount equal to the amount of such items shown on the

return of the taxpayer for the preceding taxable year (the

second preceding taxable year in the case of the first and

second required installments for such taxable year).

(e) Exceptions

(1) Where tax is small amount

No addition to tax shall be imposed under subsection (a) for

any taxable year if the tax shown on the return for such taxable

year (or, if no return is filed, the tax), reduced by the credit

allowable under section 31, is less than $1,000.

(2) Where no tax liability for preceding taxable year

No addition to tax shall be imposed under subsection (a) for

any taxable year if -

(A) the preceding taxable year was a taxable year of 12

months,

(B) the individual did not have any liability for tax for the

preceding taxable year, and

(C) the individual was a citizen or resident of the United

States throughout the preceding taxable year.

(3) Waiver in certain cases

(A) In general

No addition to tax shall be imposed under subsection (a) with

respect to any underpayment to the extent the Secretary

determines that by reason of casualty, disaster, or other

unusual circumstances the imposition of such addition to tax

would be against equity and good conscience.

(B) Newly retired or disabled individuals

No addition to tax shall be imposed under subsection (a) with

respect to any underpayment if the Secretary determines that -

(i) the taxpayer -

(I) retired after having attained age 62, or

(II) became disabled,

in the taxable year for which estimated payments were

required to be made or in the taxable year preceding such

taxable year, and

(ii) such underpayment was due to reasonable cause and not

to willful neglect.

(f) Tax computed after application of credits against tax

For purposes of this section, the term "tax" means -

(1) the tax imposed by chapter 1 (other than any increase in

such tax by reason of section 143(m)), plus

(2) the tax imposed by chapter 2, minus

(3) the credits against tax provided by part IV of subchapter A

of chapter 1, other than the credit against tax provided by

section 31 (relating to tax withheld on wages).

(g) Application of section in case of tax withheld on wages

(1) In general

For purposes of applying this section, the amount of the credit

allowed under section 31 for the taxable year shall be deemed a

payment of estimated tax, and an equal part of such amount shall

be deemed paid on each due date for such taxable year, unless the

taxpayer establishes the dates on which all amounts were actually

withheld, in which case the amounts so withheld shall be deemed

payments of estimated tax on the dates on which such amounts were

actually withheld.

(2) Separate application

The taxpayer may apply paragraph (1) separately with respect to

-

(A) wage withholding, and

(B) all other amounts withheld for which credit is allowed

under section 31.

(h) Special rule where return filed on or before January 31

If, on or before January 31 of the following taxable year, the

taxpayer files a return for the taxable year and pays in full the

amount computed on the return as payable, then no addition to tax

shall be imposed under subsection (a) with respect to any

underpayment of the 4th required installment for the taxable year.

(i) Special rules for farmers and fishermen

For purposes of this section -

(1) In general

If an individual is a farmer or fisherman for any taxable year

-

(A) there shall be only 1 required installment for the

taxable year,

(B) the due date for such installment shall be January 15 of

the following taxable year,

(C) the amount of such installment shall be equal to the

required annual payment determined under subsection (d)(1)(B)

by substituting "66 2/3 percent" for "90 percent" and without

regard to subparagraph (C) of subsection (d)(1), and

(D) subsection (h) shall be applied -

(i) by substituting "March 1" for "January 31", and

(ii) by treating the required installment described in

subparagraph (A) of this paragraph as the 4th required

installment.

(2) Farmer or fisherman defined

An individual is a farmer or fisherman for any taxable year if

-

(A) the individual's gross income from farming or fishing

(including oyster farming) for the taxable year is at least 66

2/3 percent of the total gross income from all sources for the

taxable year, or

(B) such individual's gross income from farming or fishing

(including oyster farming) shown on the return of the

individual for the preceding taxable year is at least 66 2/3

percent of the total gross income from all sources shown on

such return.

(j) Special rules for nonresident aliens

In the case of a nonresident alien described in section 6072(c):

(1) Payable in 3 installments

There shall be 3 required installments for the taxable year.

(2) Time for payment of installments

The due dates for required installments under this subsection

shall be determined under the following table:

In the case of the following T2The due date is:

required installments:

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

1st June 15

2nd September 15

3rd January 15 of the

following taxable year.

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

(3) Amount of required installments

(A) First required installment

In the case of the first required installment, subsection (d)

shall be applied by substituting "50 percent" for "25 percent"

in subsection (d)(1)(A).

(B) Determination of applicable percentage

The applicable percentage for purposes of subsection (d)(2)

shall be determined under the following table:

In the case of the following The applicable

required installments: percentage is:

1st 45

2nd 67.5

3rd 90.

(k) Fiscal years and short years

(1) Fiscal years

In applying this section to a taxable year beginning on any

date other than January 1, there shall be substituted, for the

months specified in this section, the months which correspond

thereto.

(2) Short taxable year

This section shall be applied to taxable years of less than 12

months in accordance with regulations prescribed by the

Secretary.

(g742l) Estates and trusts

(1) In general

Except as otherwise provided in this subsection, this section

shall apply to any estate or trust.

(2) Exception for estates and certain trusts

With respect to any taxable year ending before the date 2 years

after the date of the decedent's death, this section shall not

apply to -

(A) the estate of such decedent, or

(B) any trust -

(i) all of which was treated (under subpart E of part I of

subchapter J of chapter 1) as owned by the decedent, and

(ii) to which the residue of the decedent's estate will

pass under his will (or, if no will is admitted to probate,

which is the trust primarily responsible for paying debts,

taxes, and expenses of administration).

(3) Exception for charitable trusts and private foundations

This section shall not apply to any trust which is subject to

the tax imposed by section 511 or which is a private foundation.

(4) Special rule for annualizations

In the case of any estate or trust to which this section

applies, subsection (d)(2)(B)(i) shall be applied by substituting

"ending before the date 1 month before the due date for the

installment" for "ending before the due date for the

installment".

(m) Regulations

The Secretary shall prescribe such regulations as may be

necessary to carry out the purposes of this section.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 823; Pub. L. 87-682, Sec.

1(a)(4), Sept. 25, 1962, 76 Stat. 575; Pub. L. 89-368, title I,

Secs. 102(b)(1)-(3), 103(a), Mar. 15, 1966, 80 Stat. 62-64; Pub. L.

91-172, title III, Sec. 301(b)(13), Dec. 30, 1969, 83 Stat. 586;

Pub. L. 92-5, title II, Sec. 203(b)(7), Mar. 17, 1971, 85 Stat. 11;

Pub. L. 92-336, title II, Sec. 203(b)(7), July 1, 1972, 86 Stat.

420; Pub. L. 93-66, title II, Sec. 203(b)(7), (d), July 9, 1973, 87

Stat. 153; Pub. L. 93-233, Sec. 5(b)(7), (d), Dec. 31, 1973, 87

Stat. 954; Pub. L. 93-625, Sec. 7(c), Jan. 3, 1975, 88 Stat. 2115;

Pub. L. 94-455, title XIX, Sec. 1906(a)(35), (b)(13)(A), Oct. 4,

1976, 90 Stat. 1829, 1834; Pub. L. 95-30, title I, Sec. 102(b)(16),

May 23, 1977, 91 Stat. 139; Pub. L. 95-600, title IV, Sec.

421(e)(9), Nov. 6, 1978, 92 Stat. 2877; Pub. L. 97-34, title VI,

Sec. 601(a)(6)(A), title VII, Sec. 725(b), (c)(5), Aug. 13, 1981,

95 Stat. 336, 346; Pub. L. 97-248, title II, Sec. 207(d)(7),

formerly Sec. 207(c)(7), title III, Secs. 307(a)(14), 308(a),

328(a), Sept. 3, 1982, 96 Stat. 420, 590, 591, 618, renumbered Sec.

207(d)(7), Pub. L. 97-448, title III, Sec. 306(a)(1)(A)(i), Jan.

12, 1983, 96 Stat. 2400; Pub. L. 97-448, title I, Secs.

106(a)(4)(C), 107(c)(1), title II, Sec. 201(j)(3), Jan. 12, 1983,

96 Stat. 2390, 2391, 2396; Pub. L. 98-67, title I, Sec. 102(a),

Aug. 5, 1983, 97 Stat. 369; Pub. L. 98-369, div. A, title IV, Sec.

411, July 18, 1984, 98 Stat. 788; Pub. L. 99-514, title XIV, Sec.

1404(a), title XV, Secs. 1511(c)(14), 1541(a), (b), title XVIII,

Sec. 1841, Oct. 22, 1986, 100 Stat. 2713, 2745, 2751, 2852; Pub. L.

100-418, title I, Sec. 1941(b)(6)(A), Aug. 23, 1988, 102 Stat.

1324; Pub. L. 100-647, title I, Sec. 1014(d)(1), (2), title IV,

Sec. 4005(g)(5), Nov. 10, 1988, 102 Stat. 3560, 3651; Pub. L.

101-239, title VII, Sec. 7811(j)(5), (6), Dec. 19, 1989, 103 Stat.

2411, 2412; Pub. L. 102-164, title IV, Sec. 403(a), (b), Nov. 15,

1991, 105 Stat. 1062, 1064; Pub. L. 103-66, title XIII, Sec.

13214(a), (b), Aug. 10, 1993, 107 Stat. 475; Pub. L. 103-465, title

VII, Sec. 711(b), Dec. 8, 1994, 108 Stat. 4998; Pub. L. 105-34,

title X, Sec. 1091(a), title XII, Sec. 1202(a), Aug. 5, 1997, 111

Stat. 962, 994; Pub. L. 105-277, div. J, title II, Sec. 2003(a),

Oct. 21, 1998, 112 Stat. 2681-901; Pub. L. 106-170, title V, Sec.

531(a), Dec. 17, 1999, 113 Stat. 1928.)

-MISC1-

AMENDMENTS

1999 - Subsec. (d)(1)(C)(i). Pub. L. 106-170 in table substituted

items assigning applicable percentages of 108.6 for 1999 and 110

for 2000 for item assigning applicable percentage of 106 for 1999

or 2000.

1998 - Subsec. (d)(1)(C)(i). Pub. L. 105-277 in table substituted

items assigning applicable percentages of 105 for 1998 and 106 for

1999 or 2000 for item assigning applicable percentage of 105 for

1998, 1999, or 2000.

1997 - Subsec. (d)(1)(C)(i). Pub. L. 105-34, Sec. 1091(a),

reenacted heading without change and amended text generally. Prior

to amendment, text read as follows: "If the adjusted gross income

shown on the return of the individual for the preceding taxable

year exceeds $150,000, clause (ii) of subparagraph (B) shall be

applied by substituting '110 percent' for '100 percent'."

Subsec. (e)(1). Pub. L. 105-34, Sec. 1202(a), substituted

"$1,000" for "$500".

1994 - Subsec. (d)(2)(D). Pub. L. 103-465 added subpar. (D).

1993 - Subsec. (d)(1)(C) to (F). Pub. L. 103-66, Sec. 13214(a),

added subpar. (C) and struck out former subpars. (C) to (F) which

related to limitation on use of preceding year's tax, modified

adjusted gross income for current year, qualified pass-thru item,

and other definitions and special rules, respectively.

Subsec. (j)(3)(A). Pub. L. 103-66, Sec. 13214(b)(1), struck out

before period at end "and subsection (d)(1)(C)(iii) shall not

apply".

Subsec. (l)(4). Pub. L. 103-66, Sec. 13214(b)(2), substituted

"subsection (d)(2)(B)(i)" for "paragraphs (1)(C)(iv) and (2)(B)(i)

of subsection (d)".

1991 - Subsec. (d)(1)(C) to (F). Pub. L. 102-164, Sec. 403(a),

added subpars. (C) to (F).

Subsec. (i)(1)(C). Pub. L. 102-164, Sec. 403(b)(1), amended

subpar. (C) generally. Prior to amendment, subpar. (C) read as

follows: "the amount of such installment shall be equal to the

required annual payment (determined under subsection (d)(1)(B) by

substituting '66 2/3 percent' for '90 percent', and".

Subsec. (j)(3)(A). Pub. L. 102-164, Sec. 403(b)(2), inserted

before period at end "and subsection (d)(1)(C)(iii) shall not

apply".

Subsec. (l)(4). Pub. L. 102-164, Sec. 403(b)(3), substituted

"paragraphs (l)(C)(iv) and (2)(B)(i) of subsection (d)" for

"subsection (d)(2)(B)(i)".

1989 - Subsec. (l)(1). Pub. L. 101-239, Sec. 7811(j)(5),

substituted "this section shall" for "this subsection shall".

Subsec. (l)(2)(B)(ii). Pub. L. 101-239, Sec. 7811(j)(6), inserted

before period at end "(or, if no will is admitted to probate, which

is the trust primarily responsible for paying debts, taxes, and

expenses of administration)".

1988 - Subsec. (f)(1). Pub. L. 100-647, Sec. 4005(g)(5), inserted

"(other than any increase in such tax by reason of section 143(m))"

after "chapter 1".

Subsec. (f)(3). Pub. L. 100-418 amended par. (3) generally. Prior

to amendment par. (3) read as follows: "the sum of -

"(A) the credits against tax allowed by part IV of subchapter A

of chapter 1, other than the credit against tax provided by

section 31 (relating to tax withheld on wages), plus

"(B) to the extent allowed under regulations prescribed by the

Secretary, any overpayment of the tax imposed by section 4986

(determined without regard to section 4995(a)(4)(B))."

Subsec. (l). Pub. L. 100-647, Sec. 1014(d)(2), substituted

"Estates and trusts" for "Trusts and certain estates" in heading

and amended text generally. Prior to amendment, text read as

follows: "This section shall apply to -

"(1) any trust, and

"(2) any estate with respect to any taxable year ending 2 or

more years after the date of the death of the decedent's death."

Pub. L. 100-647, Sec. 1014(d)(1), made clarifying amendment to

directory language of Pub. L. 99-514, Sec. 1404(a), to reflect

prior redesignation of subsec. (k) as (l) by section 1841 of Pub.

L. 99-514, see 1986 Amendment note below.

1986 - Subsec. (a)(1). Pub. L. 99-514, Sec. 1511(c)(14),

substituted "the underpayment rate established under section 6621"

for "the applicable annual rate established under section 6621".

Subsec. (d)(1)(B)(i). Pub. L. 99-514, Sec. 1541(a), substituted

"90 percent" for "80 percent" in two places.

Subsec. (d)(2)(C)(ii). Pub. L. 99-514, Sec. 1541(b)(1), in table

of applicable percentages increased applicable percentages from

"20" to "22.5", from "40" to "45", from "60" to "67.5", and from

"80" to "90", respectively.

Subsec. (i)(1)(C). Pub. L. 99-514, Sec. 1541(b)(2), substituted

"90 percent" for "80 percent".

Subsec. (j). Pub. L. 99-514, Sec. 1841, added subsec. (j). Former

subsec. (j) redesignated (k).

Subsec. (j)(3)(B). Pub. L. 99-514, Sec. 1541(b)(3), which

directed the amendment of the table in subpar. (B) by substituting

"45" for "40", "65.5" for "60", and "90" for "80", could not be

executed because the higher figures appear in the text as enacted

by section 1841 of Pub. L. 99-514.

Subsec. (k). Pub. L. 99-514, Sec. 1841, redesignated former

subsec. (j) as (k). Former subsec. (k) redesignated (l).

Subsec. (l). Pub. L. 99-514, Sec. 1404(a), as amended by Pub. L.

100-647, Sec. 1014(d)(1), amended subsec. (l) generally. Prior to

amendment, subsec. (l) read as follows: "This section shall not

apply to any estate or trust."

Pub. L. 99-514, Sec. 1841, redesignated subsec. (k) as (l).

Former subsec. (l) redesignated (m).

Subsec. (m). Pub. L. 99-514, Sec. 1841, redesignated former

subsec. (l) as (m).

1984 - Subsec. (a). Pub. L. 98-369 amended subsec. (a) generally,

setting out the exception provision as initial phrase, previously

set out as second phrase, substituting "subsection (d)" for "this

section"; and substituting "determined by applying - " and

provisions designated cls. (1) to (3) for provisions reading

"determined at an annual rate established under section 6621 upon

the amount of the underpayment (determined under subsection (b))

for the period of the underpayment (determined under subsection

(c)))".

Subsec. (b). Pub. L. 98-369 amended subsec. (b) generally,

substituting provisions relating to amount and period of

underpayment for provisions relating only to amount of

underpayment.

Subsec. (c). Pub. L. 98-369 amended subsec. (c) generally,

substituting provisions relating to number of required installments

and due dates for provisions respecting period of underpayment. See

subsec. (b)(2) of this section.

Subsec. (d). Pub. L. 98-369 amended subsec. (d) generally,

substituting provisions relating to amount of required installments

for provisions designated "Exception" and describing conditions for

nonimposition of an addition to the tax with respect to any

underpayment of any installment.

Subsec. (e). Pub. L. 98-369 amended subsec. (e) generally,

substituting provisions relating to exceptions for provisions

relating to application of section in case of tax withheld on

wages. See subsec. (g) of this section.

Subsec. (f). Pub. L. 98-369 amended subsec. (f) generally,

substituting provisions relating to tax computed after application

of credits against tax for provisions relating to exception where

tax is small amount. See subsec. (e)(1) of this section.

Subsec. (g). Pub. L. 98-369 amended subsec. (g) generally,

substituting provisions relating to application of section in case

of tax withheld on wages for provisions relating to tax computed

after application of credits against tax. See subsec. (f) of this

section.

Subsec. (h). Pub. L. 98-369 amended subsec. (h) generally,

substituting provisions relating to special rule for returns filed

on or before January 31 for provisions relating to exception for no

tax liability for preceding taxable year. See subsec. (e)(2) of

this section.

Subsec. (i). Pub. L. 98-369 amended subsec. (i) generally,

substituting provisions relating to special rules for farmers and

fishermen for provisions relating to short taxable year. See

subsec. (j)(2) of this section.

Subsecs. (j) to (l). Pub. L. 98-369, in amending section

generally, added subsecs. (j) to (l).

1983 - Subsec. (e)(1). Pub. L. 98-67 repealed amendments made by

Pub. L. 97-248. See 1982 Amendment note below.

Subsec. (f)(1). Pub. L. 97-448, Sec. 107(c)(1), inserted ",

reduced by the credit allowable under section 31," before "is less

than".

Subsec. (g)(3)(B). Pub. L. 97-448, Sec. 201(j)(3), amended

subpar. (B) generally. Prior to amendment, subpar. (B) read as

follows: "to the extent allowed under regulations prescribed by the

Secretary, any amount which is treated under section 6429 or 6430

as an overpayment of the tax imposed by section 4986".

Pub. L. 97-448, Sec. 106(a)(4)(C), inserted "or 6430" after

"section 6429".

1982 - Subsec. (e)(1). Pub. L. 97-248, Secs. 307(a)(14), 308(a),

provided that, applicable to payments of interest, dividends, and

patronage dividends paid or credited after June 30, 1983, par. (1)

is amended by inserting ", interest, dividends, and patronage

dividends" after "tax withheld at source on wages". Section 102(a),

(b) of Pub. L. 98-67, title I, Aug. 5, 1983, 97 Stat. 369, repealed

subtitle A (Secs. 301-308) of title III of Pub. L. 97-248 as of the

close of June 30, 1983, and provided that the Internal Revenue Code

of 1954 [now 1986] [this title] shall be applied and administered

(subject to certain exceptions) as if such subtitle A (and the

amendments made by such subtitle A) had not been enacted.

Subsec. (g). Pub. L. 97-248, Sec. 328(a)(2), substituted "(f),

and (h)" for "and (f)".

Subsec. (g)(1). Pub. L. 97-248, Sec. 201(d)(7), formerly Sec.

201(c)(7), substituted "section 55" for "section 55 or 56".

Subsec. (g)(3). Pub. L. 97-248, Secs. 307(a)(14), 308(a),

provided that, applicable to payments of interest, dividends, and

patronage dividends paid or credited after June 30, 1983, subsec.

(g)(3) is amended by inserting ", interest, dividends, and

patronage dividends" after "tax withheld at source on wages".

Section 102(a), (b) of Pub. L. 98-67, title I, Aug. 5, 1983, 97

Stat. 369, repealed subtitle A (Secs. 301-308) of title III of Pub.

L. 97-248 as of the close of June 30, 1983, and provided that the

Internal Revenue Code of 1954 [now 1986] [this title] shall be

applied and administered (subject to certain exceptions) as if such

subtitle A (and the amendments made by such subtitle A) had not

been enacted.

Subsecs. (h), (i). Pub. L. 97-248, Sec. 328(a)(1), added subsec.

(h) and redesignated former subsec. (h) as (i).

1981 - Subsec. (f). Pub. L. 97-34, Sec. 725(b), added subsec.

(f). Former subsec. (f) redesignated (g).

Subsec. (f)(3). Pub. L. 97-34, Sec. 601(a)(6)(A), inserted "the

sum of - " after "(3)", designated former par. (3) as subpar. (A),

and added subpar. (B).

Subsecs. (g), (h). Pub. L. 97-34, Secs. 601(a)(6)(A), 725(b),

(c)(5), redesignated former subsec. (f) as (g), inserted reference

to subsec. (f) in introductory text, and "the sum of - " after

"(3)", designated former par. (3) as subpar. (A), and added subpar.

(B). Former subsec. (g) redesignated (h).

1978 - Subsec. (f)(1). Pub. L. 95-600 substituted "section 55 or

56" for "section 56".

1977 - Subsec. (d)(2)(A). Pub. L. 95-30 substituted provisions

directing that the placement of taxable income on an annualized

basis be accomplished under regulations prescribed by the Secretary

for provisions which had spelled out in detail the formula under

which taxable income would be placed on an annualized basis.

1976 - Subsec. (g). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck

out "or his delegate" after "Secretary".

Subsec. (h). Pub. L. 94-455, Sec. 1906(a)(35), struck out subsec.

(h) which provided that this section shall apply to taxable years

beginning after Dec. 31, 1954 and that section 294(d) of the

Internal Revenue Code of 1939 shall continue in force with respect

to taxable years beginning before Jan. 1, 1955.

1975 - Subsec. (a). Pub. L. 93-625 substituted "an annual rate

established under section 6621" for "the rate of 6 percent per

annum".

1973 - Subsec. (d)(2)(B)(ii). Pub. L. 93-233, Sec. 5(b)(7),

effective with respect to taxable years beginning after 1973,

substituted "$13,200" for "$12,600".

Pub. L. 93-233, Sec. 5(d), applicable only with respect to

remuneration paid after, and taxable years beginning after, 1973

(as provided in section 5(e) of Pub. L. 93-233, set out as an

Effective Date of 1973 Amendments note under section 409 of Title

42, The Public Health and Welfare), amended section 203(b)(7)(C) of

Pub. L. 92-336 (set out as 1973 Amendment note below), substituting

"$13,200" for "$12,600". See, also, 1973 Amendment note below.

Pub. L. 93-66, Sec. 203(b)(7), effective with respect to taxable

years beginning after 1973, substituted "$12,600" for "$12,000".

Pub. L. 93-66, Sec. 203(d), applicable only with respect to

remuneration paid after, and taxable years beginning after, 1973

(as provided in section 203(e) of Pub. L. 93-66, set out as an

Effective Date of 1973 Amendments note under section 409 of Title

42, The Public Health and Welfare), amended section 203(b)(7)(C) of

Pub. L. 92-336 (set out as 1972 Amendment note below, substituting

"$12,600" for "$12,000". See, also, such 1972 Amendment note below.

1972 - Subsec. (d)(2)(B)(ii). Pub. L. 92-336, Sec. 203(b)(7)(A)

substituted "$10,800" for "$9,000".

Pub. L. 92-336, Sec. 203(b)(7)(B), effective with respect to

taxable years beginning after 1973, substituted "$12,000" for

"$10,800".

Pub. L. 92-336, Sec. 203(b)(7)(C), effective with respect to

taxable years beginning after 1974, substituted "(I) an amount

equal to the contribution and benefit base (as determined under

section 230 of the Social Security Act) which is effective for the

calendar year in which the taxable year begins, over (II)" for

"$12,000 over".

1971 - Subsec. (d)(2)(B)(ii). Pub. L. 92-5 substituted "$9,000"

for "$6,600".

1969 - Subsec. (f)(1). Pub. L. 91-172 inserted "(other than by

section 56)" after "chapter 1".

1966 - Subsec. (a). Pub. L. 89-368, Sec. 102(b)(1), inserted "and

the tax under chapter 2" after "chapter 1".

Subsec. (b). Pub. L. 89-368, Sec. 103(a), substituted "80

percent" for "70 percent" whenever appearing.

Subsec. (d). Pub. L. 89-368, Secs. 102(b)(2), 103(a), inserted

requirement that, for purposes of applying the annualization

exception, the tax on adjusted self-employment income be included

in determining if the net earnings from self-employment for the

taxable year equal or exceed $400, inserted definition of "adjusted

self-employment income", inserted a requirement that, for purposes

of determining the applicability of the 90 percent exception, the

tax on actual self-employment income be included, and substituted

"80 percent" for "70 percent" wherever appearing.

Subsec. (f). Pub. L. 89-368, Sec. 102(b)(3), inserted tax imposed

by chapter 2 to definition of "tax".

1962 - Subsecs. (b), (d)(1)(C). Pub. L. 87-682 inserted "or

fishing" after "from farming" wherever appearing.

EFFECTIVE DATE OF 1999 AMENDMENT

Pub. L. 106-170, title V, Sec. 531(b), Dec. 17, 1999, 113 Stat.

1928, provided that: "The amendment made by this section [amending

this section] shall apply with respect to any installment payment

for taxable years beginning after December 31, 1999."

EFFECTIVE DATE OF 1998 AMENDMENT

Pub. L. 105-277, div. J, title II, Sec. 2003(b), Oct. 21, 1998,

112 Stat. 2681-902, provided that: "The amendment made by this

section [amending this section] shall apply with respect to any

installment payment for taxable years beginning after December 31,

1999."

EFFECTIVE DATE OF 1997 AMENDMENT

Section 1091(b) of Pub. L. 105-34 provided that: "The amendment

made by this section [amending this section] shall apply with

respect to any installment payment for taxable years beginning

after December 31, 1997."

Section 1202(b) of Pub. L. 105-34 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1997."

EFFECTIVE DATE OF 1994 AMENDMENT

Section 711(c) of Pub. L. 103-465 provided that: "The amendments

made by this section [amending this section and section 6655 of

this title] shall apply for purposes of determining underpayments

of estimated tax for taxable years beginning after December 31,

1994."

EFFECTIVE DATE OF 1993 AMENDMENT

Section 13214(c) of Pub. L. 103-66 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1993."

EFFECTIVE DATE OF 1991 AMENDMENT

Section 403(c) of Pub. L. 102-164 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1991."

EFFECTIVE DATE OF 1989 AMENDMENT

Amendment by Pub. L. 101-239 effective, except as otherwise

provided, as if included in the provision of the Technical and

Miscellaneous Revenue Act of 1988, Pub. L. 100-647, to which such

amendment relates, see section 7817 of Pub. L. 101-239, set out as

a note under section 1 of this title.

EFFECTIVE DATE OF 1988 AMENDMENTS

Amendment by section 1014(d)(1), (2) of Pub. L. 100-647

effective, except as otherwise provided, as if included in the

provision of the Tax Reform Act of 1986, Pub. L. 99-514, to which

such amendment relates, see section 1019(a) of Pub. L. 100-647, set

out as a note under section 1 of this title.

Amendment by section 4005(g)(5) of Pub. L. 100-647 applicable to

financing provided, and mortgage credit certificates issued, after

Dec. 31, 1990, with certain exceptions, see section 4005(h)(3) of

Pub. L. 100-647, set out as a note under section 143 of this title.

Amendment by Pub. L. 100-418 applicable to crude oil removed from

the premises on or after Aug. 23, 1988, see section 1941(c) of Pub.

L. 100-418, set out as a note under section 164 of this title.

EFFECTIVE DATE OF 1986 AMENDMENTS

Pub. L. 100-203, title X, Sec. 10303(a), Dec. 22, 1987, 101 Stat.

1330-430, provided that: "Notwithstanding section 1541(c) of the

Tax Reform Act of 1986 [section 1541(c) of Pub. L. 99-514, set out

below], the amendments made by section 1541 of such Act [amending

this section] shall apply only to taxable years beginning after

December 31, 1987."

Amendment by section 1404(a) of Pub. L. 99-514 applicable to

taxable years beginning after Dec. 31, 1986, see section 1404(d) of

Pub. L. 99-514, set out as a note under section 643 of this title.

Amendment by section 1511(c)(14) of Pub. L. 99-514 applicable for

purposes of determining interest for periods after Dec. 31, 1986,

see section 1511(d) of Pub. L. 99-514, set out as a note under

section 47 of this title.

Section 1541(c) of Pub. L. 99-514 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1986." [See section 10303(a) of

Pub. L. 100-203, set out above.]

Amendment by section 1841 of Pub. L. 99-514 effective, except as

otherwise provided, as if included in the provisions of the Tax

Reform Act of 1984, Pub. L. 98-369, div. A, to which such amendment

relates, see section 1881 of Pub. L. 99-514, set out as a note

under section 48 of this title.

EFFECTIVE DATE OF 1984 AMENDMENT

Section 414(a) of Pub. L. 98-369, as amended by Pub. L. 99-514,

Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:

"(1) In general. - The amendments made by sections 411 and 412

[amending this section and sections 871, 1403, 6012, 6020, 6201,

6362, 6601, 6651, 7203, 7216, and 7701 of this title and repealing

sections 6015, 6073, and 6153 of this title] shall apply with

respect to taxable years beginning after December 31, 1984.

"(2) Waiver authority. - The provisions of paragraph (3) of

section 6654(e) of the Internal Revenue Code of 1986 [formerly

I.R.C. 1954] (as amended by section 411) shall also apply with

respect to underpayments for taxable years beginning in 1984."

EFFECTIVE DATE OF 1983 AMENDMENT

Amendment by section 106(a)(4)(C) of Pub. L. 97-448 effective

Jan. 1, 1982, see section 106(a)(4)(E)(ii) of Pub. L. 97-448, set

out as an Effective Date note under section 6430 of this title.

Amendment by title I of Pub. L. 97-448 effective, except as

otherwise provided, as if it had been included in the provision of

the Economic Recovery Tax Act of 1981, Pub. L. 97-34, to which such

amendment relates, see section 109 of Pub. L. 97-448, set out as a

note under section 1 of this title.

Amendment by title II of Pub. L. 97-448 effective, except as

otherwise provided, as if it had been included in the provision of

the Crude Oil Windfall Profit Tax Act of 1980, Pub. L. 96-223, to

which such amendment relates, see section 203(a), (b) of Pub. L.

97-448, set out as a note under section 6652 of this title.

EFFECTIVE DATE OF 1982 AMENDMENT

Amendment by section 201(d)(7) of Pub. L. 97-248 applicable to

taxable years beginning after Dec. 31, 1982, see section 201(e)(1)

of Pub. L. 97-248, set out as a note under section 5 of this title.

Section 328(c) of Pub. L. 97-248 provided that: "The amendments

made by this section [amending this section and sections 6015,

6073, and 6153 of this title] shall apply to taxable years

beginning after December 31, 1982."

EFFECTIVE DATE OF 1981 AMENDMENT

Section 601(c)(1), (2) of Pub. L. 97-34 provided that:

"(1) Except as provided in paragraph (2), subsection (a)

[amending this section and sections 6429 and 6655 of this title]

shall take effect on January 1, 1981.

"(2) The amendments made by paragraph (6) of subsection (a)

[amending this section and section 6655 of this title] shall take

effect on January 1, 1980."

Amendment by section 725(b), (c)(5) of Pub. L. 97-34 applicable

to estimated tax for taxable years beginning after Dec. 31, 1980,

see section 725(d) of Pub. L. 97-34, set out as a note under

section 871 of this title.

EFFECTIVE DATE OF 1978 AMENDMENT

Amendment by Pub. L. 95-600 applicable to taxable years beginning

after Dec. 31, 1978, see section 421(g) of Pub. L. 95-600, set out

as a note under section 5 of this title.

EFFECTIVE DATE OF 1977 AMENDMENT

Amendment by Pub. L. 95-30 applicable to taxable years beginning

after Dec. 31, 1976, see section 106(a) of Pub. L. 95-30, set out

as a note under section 1 of this title.

EFFECTIVE DATE OF 1976 AMENDMENT

Amendment by Pub. L. 94-455 effective first day of first month

which begins more than 90 days after Oct. 4, 1976, see section

1906(d)(1) of Pub. L. 94-455, set out as a note under section 6013

of this title.

EFFECTIVE DATE OF 1975 AMENDMENT

Amendment by Pub. L. 93-625 effective July 1, 1975, and

applicable to amounts outstanding on such date or arising

thereafter, see section 7(e) of Pub. L. 93-625, set out as an

Effective Date note under section 6621 of this title.

EFFECTIVE DATE OF 1973 AMENDMENTS

Amendment by Pub. L. 93-233 applicable only with respect to

remuneration paid after, and taxable years beginning after, 1973,

see section 5(e) of Pub. L. 93-233, set out as a note under section

409 of Title 42, The Public Health and Welfare.

Amendment by Pub. L. 93-66 applicable only with respect to

remuneration paid after, and taxable years beginning after, 1973,

see section 203(e) of Pub. L. 93-66, set out as a note under

section 409 of Title 42.

EFFECTIVE DATE OF 1972 AMENDMENT

Amendment by Pub. L. 92-336 applicable only with respect to

taxable years beginning after 1972, see section 203(c) of Pub.

92-336, set out as a note under section 409 of Title 42, The Public

Health and Welfare.

EFFECTIVE DATE OF 1971 AMENDMENT

Amendment by Pub. L. 92-5 applicable only with respect to taxable

years beginning after 1971, see section 203(c) of Pub. L. 92-5, set

out as a note under section 409 of Title 42, The Public Health and

Welfare.

EFFECTIVE DATE OF 1969 AMENDMENT

Amendment by Pub. L. 91-172 applicable to taxable years ending

after Dec. 31, 1969, see section 301(c) of Pub. L. 91-172, set out

as a note under section 5 of this title.

EFFECTIVE DATE OF 1966 AMENDMENT

Section 102(d) of Pub. L. 89-368 provided that: "The amendments

made by subsections (a) amending section 6015 of this title], (b)

[amending this section and sections 1403, 6211, and 7701 of this

title], and (c) [amending section 1402 of this title] shall apply

with respect to taxable years beginning after December 31, 1966."

Section 103(b) of Pub. L. 89-368 provided that: "The amendments

made by subsection (a) [amending this section] shall apply with

respect to taxable years beginning after December 31, 1966."

EFFECTIVE DATE OF 1962 AMENDMENT

Section 2 of Pub. L. 87-682 provided that: "The amendments made

by the first section of this Act [amending this section and

sections 6015, 6073, and 6153 of this title] shall apply only with

respect to taxable years beginning after December 31, 1962."

WAIVER OF ESTIMATED TAX PENALTIES FOR 1998 UNDERPAYMENTS

Pub. L. 105-206, Sec. 1(c), July 22, 1998, 112 Stat. 685,

provided that: "No addition to tax shall be made under section 6654

or 6655 of the Internal Revenue Code of 1986 with respect to any

underpayment of an installment required to be paid on or before the

30th day after the date of the enactment of this Act [July 22,

1998] to the extent such underpayment was created or increased by

any provision of this Act [see Tables for classification]."

Section 1(d) of Pub. L. 105-34 provided that: "No addition to tax

shall be made under section 6654 or 6655 of the Internal Revenue

Code of 1986 for any period before January 1, 1998, for any payment

the due date of which is before January 16, 1998, with respect to

any underpayment attributable to such period to the extent such

underpayment was created or increased by any provision of this Act

[see Tables for classification]."

UNDERPAYMENTS OF ESTIMATED TAX FOR 1996

Pub. L. 104-188, title I, Sec. 1102, Aug. 20, 1996, 110 Stat.

1758, provided that: "No addition to the tax shall be made under

section 6654 or 6655 of the Internal Revenue Code of 1986 (relating

to failure to pay estimated tax) with respect to any underpayment

of an installment required to be paid before the date of the

enactment of this Act [Aug. 20, 1996] to the extent such

underpayment was created or increased by any provision of this

title [title I (Secs. 1101-1954) of Pub. L. 104-188, see Tables for

classification]."

WAIVER OF ESTIMATED PENALTIES FOR 1993 UNDERPAYMENTS ATTRIBUTABLE

TO REVENUE RECONCILIATION ACT OF 1993

Section 13001(d) of Pub. L. 103-66 provided that: "No addition to

tax shall be made under section 6654 or 6655 of the Internal

Revenue Code of 1986 for any period before April 16, 1994 (March

16, 1994, in the case of a corporation), with respect to any

underpayment to the extent such underpayment was created or

increased by any provision of this chapter [chapter 1 (Secs.

13001-13444) of title XIII of Pub. L. 103-66, see Tables for

classification]."

WAIVER OF ESTIMATED TAX PENALTIES FOR UNDERPAYMENTS ATTRIBUTABLE TO

SECTION 420(B)(4)(B) OF THIS TITLE

No addition to tax to be made under this section for taxable year

preceding taxpayer's first taxable year beginning after Dec. 31,

1990, with respect to any underpayment to the extent such

underpayment was created or increased by reason of section

420(b)(4)(B) of this title, see section 12011(c)(2) of Pub. L.

101-508, set out as an Effective Date note under section 420 of

this title.

WAIVER OF ESTIMATED PENALTIES FOR 1988 UNDERPAYMENTS ATTRIBUTABLE

TO TECHNICAL AND MISCELLANEOUS REVENUE ACT OF 1988

No addition to tax to be made under this section for any period

before Apr. 16, 1989, with respect to any underpayment to the

extent that such underpayment was created or increased by any

provision of title I (Secs. 1001-1019) or II (Secs. 2001-2006) of

Pub. L. 100-647, see section 1019(b) of Pub. L. 100-647, set out as

an Effective Date of 1988 Amendment note under section 1 of this

title.

PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989

For provisions directing that if any amendments made by subtitle

A or subtitle C of title XI [Secs. 1101-1147 and 1171-1177] or

title XVIII [Secs. 1800-1899A] of Pub. L. 99-514 require an

amendment to any plan, such plan amendment shall not be required to

be made before the first plan year beginning on or after Jan. 1,

1989, see section 1140 of Pub. L. 99-514, as amended, set out as a

note under section 401 of this title.

WAIVER OF ESTIMATED PENALTIES FOR 1986 UNDERPAYMENTS ATTRIBUTABLE

TO TAX REFORM ACT OF 1986

Section 1543 of Pub. L. 99-514 provided that: "No addition to tax

shall be made under section 6654 or 6655 of the Internal Revenue

Code of 1986 (relating to failure to pay estimated tax) for any

period before April 16, 1987 (March 16, 1987, in the case of a

taxpayer subject to section 6655 of such Code), with respect to any

underpayment, to the extent such underpayment was created or

increased by any provision of this Act [Pub. L. 99-514, see Tables

for classification]."

WAIVER OF ESTIMATED TAX PENALTIES

No addition to tax to be made under this section for any period

before Apr. 16, 1985, with respect to any underpayment, to the

extent that such underpayment was created or increased by any

provision of Pub. L. 98-369, div. A, see section 1879(a) of Pub. L.

99-514, set out as a note under section 6655 of this title.

INCREASE IN SECTION 31 CREDIT FOR TAXABLE YEARS WHICH INCLUDE ANY

PORTION OF PERIOD JULY 1, 1983, TO DECEMBER 31, 1983

For purposes of determining the amount of any addition to tax

under this section with respect to any installment required to be

paid before July 1, 1983, the amount of the credit allowed by

section 31 of this title for any taxable year which includes any

portion of the period beginning July 1, 1983, and ending December

31, 1983, to be increased by an amount equal to 10 percent of the

aggregate amount of payments (1) which are received during the

portion of such taxable year after June 30, 1983, and before

January 1, 1984, and (2) which (but for the repeal of sections 3451

to 3456 of this title) would have been subject to withholding under

sections 3451 to 3456 of this title (determined without regard to

any exemption described in former section 3452 of this title, see

section 102(d) of Pub. L. 98-67, set out as a note under section

3451 of this title.

ESTIMATED TAX UNDERPAYMENTS CREATED OR INCREASED BY TAX REFORM ACT

OF 1976

Section 303 of Pub. L. 95-30, as amended by Pub. L. 99-514, Sec.

2, Oct. 22, 1986, 100 Stat. 2095, provided that: "No addition to

the tax shall be made under section 6654 or 6655 of the Internal

Revenue Code of 1986 [formerly I.R.C. 1954] (relating to failure to

pay estimated income tax) for any period before April 16, 1977

(March 16, 1977, in the case of a taxpayer subject to section

6655), with respect to any underpayment, to the extent that such

underpayment was created or increased by any provision of the Tax

Reform Act of 1976 [Pub. L. 94-455]."

WAIVER OF PENALTY FOR UNDERPAYMENT OF 1971 ESTIMATED INCOME TAX

Pub. L. 92-178, title II, Sec. 207, Dec. 10, 1971, 85 Stat. 512,

provided that subsec. (a) of this section did not apply to any

taxable year beginning after Dec. 31, 1970 and ending before Jan.

1, 1972, if the gross income for such taxable year did not exceed

$10,000 for a single individual other than head of household or a

married individual filing separately, or if the gross income did

not exceed $20,000 for a head of household, a surviving spouse, of

married individuals filing jointly, or if the taxpayer had income

from sources other than wages in excess of $200 or $400 in case of

a joint return.

DECLARATION OF ESTIMATED TAX

With respect to taxable years beginning before Dec. 30, 1969, if

a taxpayer is required to make a declaration, or to pay any amount

of estimated tax by reason of amendments made by Pub. L. 91-172,

such amount shall be paid ratably on each of the remaining

installment dates for the taxable year beginning with the first

installment date on or after Dec. 30, 1969; as to any declaration

or payment of estimates tax before the first installment date, this

section, and sections 6015, 6154, and 6655 of this title shall be

applied without regard to amendments made by Pub. L. 91-172, see

section 946(b) of Pub. L. 91-172, set out as a note under section

6153 of this title.

TAX SURCHARGE EXTENSION; DECLARATIONS OF ESTIMATED TAX

Requirement of making a declaration or amended declaration or

amended declaration of estimated tax or of payment of any amount or

additional amount of estimated tax by reason of amendment of

sections 51(a)(1)(A), (B), (2)(A) and 963(b) of this title as

calling for payment of such amount or additional amount ratably on

or before each of remaining installment dates for taxable year

beginning with first installment date on or after the 30th day

after Aug. 7, 1969; application of this section without regard to

such amendment with respect to any declaration or payment of

estimated tax before such first installment date; and definition of

"installment date", see Pub. L. 91-53, Sec. 5(c), Aug. 7, 1969, 83

Stat. 95.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 167, 460, 3510, 6201,

6601, 6621, 6622, 6651, 6658, 6665, 6751, 7203 of this title; title

42 section 430.

-End-

-CITE-

26 USC Sec. 6655 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6655. Failure by corporation to pay estimated income tax

-STATUTE-

(a) Addition to tax

Except as otherwise provided in this section, in the case of any

underpayment of estimated tax by a corporation, there shall be

added to the tax under chapter 1 for the taxable year an amount

determined by applying -

(1) the underpayment rate established under section 6621,

(2) to the amount of the underpayment,

(3) for the period of the underpayment.

(b) Amount of underpayment; period of underpayment

For purposes of subsection (a) -

(1) Amount

The amount of the underpayment shall be the excess of -

(A) the required installment, over

(B) the amount (if any) of the installment paid on or before

the due date for the installment.

(2) Period of underpayment

The period of the underpayment shall run from the due date for

the installment to whichever of the following dates is the

earlier -

(A) the 15th day of the 3rd month following the close of the

taxable year, or

(B) with respect to any portion of the underpayment, the date

on which such portion is paid.

(3) Order of crediting payments

For purposes of paragraph (2)(B), a payment of estimated tax

shall be credited against unpaid required installments in the

order in which such installments are required to be paid.

(c) Number of required installments; due dates

For purposes of this section -

(1) Payable in 4 installments

There shall be 4 required installments for each taxable year.

(2) Time for payment of installments

In the case of the following The due date is:

required installments:

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

1st April 15

2nd June 15

3rd September 15

4th December 15.

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

(d) Amount of required installments

For purposes of this section -

(1) Amount

(A) In general

Except as otherwise provided in this section, the amount of

any required installment shall be 25 percent of the required

annual payment.

(B) Required annual payment

Except as otherwise provided in this subsection, the term

"required annual payment" means the lesser of -

(i) 100 percent of the tax shown on the return for the

taxable year (or, if no return is filed, 100 percent of the

tax for such year), or

(ii) 100 percent of the tax shown on the return of the

corporation for the preceding taxable year.

Clause (ii) shall not apply if the preceding taxable year was not

a taxable year of 12 months, or the corporation did not file a

return for such preceding taxable year showing a liability for

tax.

(2) Large corporations required to pay 100 percent of current

year tax

(A) In general

Except as provided in subparagraph (B), clause (ii) of

paragraph (1)(B) shall not apply in the case of a large

corporation.

(B) May use last year's tax for 1st installment

Subparagraph (A) shall not apply for purposes of determining

the amount of the 1st required installment for any taxable

year. Any reduction in such 1st installment by reason of the

preceding sentence shall be recaptured by increasing the amount

of the next required installment determined under paragraph (1)

by the amount of such reduction.

(e) Lower required installment where annualized income installment

or adjusted seasonal installment is less than amount determined

under subsection (d)

(1) In general

In the case of any required installment, if the corporation

establishes that the annualized income installment or the

adjusted seasonal installment is less than the amount determined

under subsection (d)(1) (as modified by paragraphs (2) and (3) of

subsection (d)) -

(A) the amount of such required installment shall be the

annualized income installment (or, if lesser, the adjusted

seasonal installment), and

(B) any reduction in a required installment resulting from

the application of this paragraph shall be recaptured by

increasing the amount of the next required installment

determined under subsection (d)(1) (as so modified) by the

amount of such reduction (and by increasing subsequent required

installments to the extent that the reduction has not

previously been recaptured under this subparagraph).

(2) Determination of annualized income installment

(A) In general

In the case of any required installment, the annualized

income installment is the excess (if any) of -

(i) an amount equal to the applicable percentage of the tax

for the taxable year computed by placing on an annualized

basis the taxable income, alternative minimum taxable income,

and modified alternative minimum taxable income -

(I) for the first 3 months of the taxable year, in the

case of the 1st required installment,

(II) for the first 3 months of the taxable year, in the

case of the 2nd required installment,

(III) for the first 6 months of the taxable year in the

case of the 3rd required installment, and

(IV) for the first 9 months of the taxable year, in the

case of the 4th required installment, over

(ii) the aggregate amount of any prior required

installments for the taxable year.

(B) Special rules

For purposes of this paragraph -

(i) Annualization

The taxable income, alternative minimum taxable income, and

modified alternative minimum taxable income shall be placed

on an annualized basis under regulations prescribed by the

Secretary.

(ii) Applicable percentage

In the case of the following The applicable

required installments: percentage is:

1st 25

2nd 50

3rd 75

4th 100.

(iii) Modified alternative minimum taxable income

The term "modified alternative minimum taxable income" has

the meaning given to such term by section 59A(b).

(C) Election for different annualization periods

(i) If the taxpayer makes an election under this clause -

(I) subclause (I) of subparagraph (A)(i) shall be applied

by substituting "2 months" for "3 months",

(II) subclause (II) of subparagraph (A)(i) shall be applied

by substituting "4 months" for "3 months",

(III) subclause (III) of subparagraph (A)(i) shall be

applied by substituting "7 months" for "6 months", and

(IV) subclause (IV) of subparagraph (A)(i) shall be applied

by substituting "10 months" for "9 months".

(ii) If the taxpayer makes an election under this clause -

(I) subclause (II) of subparagraph (A)(i) shall be applied

by substituting "5 months" for "3 months",

(II) subclause (III) of subparagraph (A)(i) shall be

applied by substituting "8 months" for "6 months", and

(III) subclause (IV) of subparagraph (A)(i) shall be

applied by substituting "11 months" for "9 months".

(iii) An election under clause (i) or (ii) shall apply to the

taxable year for which made and such an election shall be

effective only if made on or before the date required for the

payment of the first required installment for such taxable

year.

(3) Determination of adjusted seasonal installment

(A) In general

In the case of any required installment, the amount of the

adjusted seasonal installment is the excess (if any) of -

(i) 100 percent of the amount determined under subparagraph

(C), over

(ii) the aggregate amount of all prior required

installments for the taxable year.

(B) Limitation on application of paragraph

This paragraph shall apply only if the base period percentage

for any 6 consecutive months of the taxable year equals or

exceeds 70 percent.

(C) Determination of amount

The amount determined under this subparagraph for any

installment shall be determined in the following manner -

(i) take the taxable income for all months during the

taxable year preceding the filing month,

(ii) divide such amount by the base period percentage for

all months during the taxable year preceding the filing

month,

(iii) determine the tax on the amount determined under

clause (ii), and

(iv) multiply the tax computed under clause (iii) by the

base period percentage for the filing month and all months

during the taxable year preceding the filing month.

(D) Definitions and special rules

For purposes of this paragraph -

(i) Base period percentage

The base period percentage for any period of months shall

be the average percent which the taxable income for the

corresponding months in each of the 3 preceding taxable years

bears to the taxable income for the 3 preceding taxable

years.

(ii) Filing month

The term "filing month" means the month in which the

installment is required to be paid.

(iii) Reorganization, etc.

The Secretary may by regulations provide for the

determination of the base period percentage in the case of

reorganizations, new corporations, and other similar

circumstances.

(4) Treatment of subpart F and section 936 income

(A) In general

Any amounts required to be included in gross income under

section 936(h) or 951(a) (and credits properly allocable

thereto) shall be taken into account in computing any

annualized income installment under paragraph (2) in a manner

similar to the manner under which partnership income inclusions

(and credits properly allocable thereto) are taken into

account.

(B) Prior year safe harbor

(i) In general

If a taxpayer elects to have this subparagraph apply for

any taxable year -

(I) subparagraph (A) shall not apply, and

(II) for purposes of computing any annualized income

installment for such taxable year, the taxpayer shall be

treated as having received ratably during such taxable year

items of income and credit described in subparagraph (A) in

an amount equal to 115 percent of the amount of such items

shown on the return of the taxpayer for the preceding

taxable year (the second preceding taxable year in the case

of the first and second required installments for such

taxable year).

(ii) Special rule for noncontrolling shareholder

(I) In general

If a taxpayer making the election under clause (i) is a

noncontrolling shareholder of a corporation, clause (i)(II)

shall be applied with respect to items of such corporation

by substituting "100 percent" for "115 percent".

(II) Noncontrolling shareholder

For purposes of subclause (I), the term "noncontrolling

shareholder" means, with respect to any corporation, a

shareholder which (as of the beginning of the taxable year

for which the installment is being made) does not own

(within the meaning of section 958(a)), and is not treated

as owning (within the meaning of section 958(b)), more than

50 percent (by vote or value) of the stock in the

corporation.

(5) Treatment of certain REIT dividends

(A) In general

Any dividend received from a closely held real estate

investment trust by any person which owns (after application of

subsection (d)(5) of section 856) 10 percent or more (by vote

or value) of the stock or beneficial interests in the trust

shall be taken into account in computing annualized income

installments under paragraph (2) in a manner similar to the

manner under which partnership income inclusions are taken into

account.

(B) Closely held REIT

For purposes of subparagraph (A), the term "closely held real

estate investment trust" means a real estate investment trust

with respect to which 5 or fewer persons own (after application

of subsection (d)(5) of section 856) 50 percent or more (by

vote or value) of the stock or beneficial interests in the

trust.

(f) Exception where tax is small amount

No addition to tax shall be imposed under subsection (a) for any

taxable year if the tax shown on the return for such taxable year

(or, if no return is filed, the tax) is less than $500.

(g) Definitions and special rules

(1) Tax

For purposes of this section, the term "tax" means the excess

of -

(A) the sum of -

(i) the tax imposed by section 11 or 1201(a), or subchapter

L of chapter 1, whichever applies,

(ii) the tax imposed by section 55,

(iii) the tax imposed by section 59A, plus

(iv) the tax imposed by section 887, over

(B) the credits against tax provided by part IV of subchapter

A of chapter 1.

For purposes of the preceding sentence, in the case of a foreign

corporation subject to taxation under section 11 or 1201(a), or

under subchapter L of chapter 1, the tax imposed by section 881

shall be treated as a tax imposed by section 11.

(2) Large corporation

(A) In general

For purposes of this section, the term "large corporation"

means any corporation if such corporation (or any predecessor

corporation) had taxable income of $1,000,000 or more for any

taxable year during the testing period.

(B) Rules for applying subparagraph (A)

(i) Testing period

For purposes of subparagraph (A), the term "testing period"

means the 3 taxable years immediately preceding the taxable

year involved.

(ii) Members of controlled group

For purposes of applying subparagraph (A) to any taxable

year in the testing period with respect to corporations which

are component members of a controlled group of corporations

for such taxable year, the $1,000,000 amount specified in

subparagraph (A) shall be divided among such members under

rules similar to the rules of section 1561.

(iii) Certain carrybacks and carryovers not taken into

account

For purposes of subparagraph (A), taxable income shall be

determined without regard to any amount carried to the

taxable year under section 172 or 1212(a).

(3) Certain tax-exempt organizations

For purposes of this section -

(A) Any organization subject to the tax imposed by section

511, and any private foundation, shall be treated as a

corporation subject to tax under section 11.

(B) Any tax imposed by section 511, and any tax imposed by

section 1 or 4940 on a private foundation, shall be treated as

a tax imposed by section 11.

(C) Any reference to taxable income shall be treated as

including a reference to unrelated business taxable income or

net investment income (as the case may be).

In the case of any organization described in subparagraph (A),

subsection (b)(2)(A) shall be applied by substituting "5th month"

for "3rd month", subsection (e)(2)(A) shall be applied by

substituting "2 months" for "3 months" in clause (i)(I), the

election under clause (i) of subsection (e)(2)(C) may be made

separately for each installment, and clause (ii) of subsection

(e)(2)(C) shall not apply. In the case of a private foundation,

subsection (c)(2) shall be applied by substituting "May 15" for

"April 15".

(4) Application of section to certain taxes imposed on S

corporations

In the case of an S corporation, for purposes of this section -

(A) The following taxes shall be treated as imposed by

section 11:

(i) The tax imposed by section 1374(a) (or the

corresponding provisions of prior law).

(ii) The tax imposed by section 1375(a).

(iii) Any tax for which the S corporation is liable by

reason of section 1371(d)(2).

(B) Paragraph (2) of subsection (d) shall not apply.

(C) Clause (ii) of subsection (d)(1)(B) shall be applied as

if it read as follows:

"(ii) the sum of -

"(I) the amount determined under clause (i) by only

taking into account the taxes referred to in clauses (i)

and (iii) of subsection (g)(4)(A), and

"(II) 100 percent of the tax imposed by section 1375(a)

which was shown on the return of the corporation for the

preceding taxable year."

(D) The requirement in the last sentence of subsection

(d)(1)(B) that the return for the preceding taxable year show a

liability for tax shall not apply.

(E) Any reference in subsection (e) to taxable income shall

be treated as including a reference to the net recognized

built-in gain or the excess passive income (as the case may

be).

(h) Excessive adjustment under section 6425

(1) Addition to tax

If the amount of an adjustment under section 6425 made before

the 15th day of the 3rd month following the close of the taxable

year is excessive, there shall be added to the tax under chapter

1 for the taxable year an amount determined at the underpayment

rate established under section 6621 upon the excessive amount

from the date on which the credit is allowed or the refund is

paid to such 15th day.

(2) Excessive amount

For purposes of paragraph (1), the excessive amount is equal to

the amount of the adjustment or (if smaller) the amount by which

-

(A) the income tax liability (as defined in section 6425(c))

for the taxable year as shown on the return for the taxable

year, exceeds

(B) the estimated income tax paid during the taxable year,

reduced by the amount of the adjustment.

(i) Fiscal years and short years

(1) Fiscal years

In applying this section to a taxable year beginning on any

date other than January 1, there shall be substituted, for the

months specified in this section, the months which correspond

thereto.

(2) Short taxable year

This section shall be applied to taxable years of less than 12

months in accordance with regulations prescribed by the

Secretary.

(j) Regulations

The Secretary shall prescribe such regulations as may be

necessary to carry out the purposes of this section.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 825; Pub. L. 88-272, title I,

Sec. 122(c), Feb. 26, 1964, 78 Stat. 28; Pub. L. 90-364, title I,

Sec. 103(c), (d)(2), (e)(1), June 28, 1968, 82 Stat. 262, 264; Pub.

L. 93-625, Sec. 7(c), Jan. 3, 1975, 88 Stat. 2115; Pub. L. 94-455,

title XIX, Sec. 1906(b)(3)(A)-(C)(i), (13)(A), Oct. 4, 1976, 90

Stat. 1833, 1834; Pub. L. 95-600, title III, Sec. 301(b)(20)(B),

Nov. 6, 1978, 92 Stat. 2824; Pub. L. 96-499, title XI, Sec.

1111(a), (b), Dec. 5, 1980, 94 Stat. 2681, 2682; Pub. L. 97-34,

title VI, Sec. 601(a)(6)(B), title VII, Sec. 731(a), (b), Aug. 13,

1981, 95 Stat. 336, 346, 347; Pub. L. 97-248, title II, Sec.

234(a), (c), (d), Sept. 3, 1982, 96 Stat. 503, 504; Pub. L. 97-448,

title II, Sec. 201(j)(4), Jan. 12, 1983, 96 Stat. 2396; Pub. L.

99-499, title V, Sec. 516(b)(4)(D), Oct. 17, 1986, 100 Stat. 1771;

Pub. L. 99-514, title VII, Sec. 701(d)(3), title XV, Sec.

1511(c)(15), Oct. 22, 1986, 100 Stat. 2342, 2745; Pub. L. 100-203,

title X, Sec. 10301(a), Dec. 22, 1987, 101 Stat. 1330-424; Pub. L.

100-418, title I, Sec. 1941(b)(6)(B), Aug. 23, 1988, 102 Stat.

1324; Pub. L. 100-647, title II, Sec. 2004(r), title V, Sec.

5001(a), Nov. 10, 1988, 102 Stat. 3609, 3660; Pub. L. 101-239,

title VII, Secs. 7209(a), 7822(a), Dec. 19, 1989, 103 Stat. 2338,

2424; Pub. L. 101-508, title XI, Sec. 11704(a)(28), Nov. 5, 1990,

104 Stat. 1388-519; Pub. L. 102-227, title II, Sec. 201(a), (b),

Dec. 11, 1991, 105 Stat. 1689; Pub. L. 102-244, Sec. 3(a), Feb. 7,

1992, 106 Stat. 4; Pub. L. 102-318, title V, Sec. 512(a), (b), July

3, 1992, 106 Stat. 300; Pub. L. 103-66, title XIII, Sec. 13225(a),

(b), Aug. 10, 1993, 107 Stat. 486; Pub. L. 103-465, title VII, Sec.

711(a), Dec. 8, 1994, 108 Stat. 4998; Pub. L. 104-188, title I,

Sec. 1703(h), Aug. 20, 1996, 110 Stat. 1876; Pub. L. 105-34, title

XIV, Sec. 1461(a), Aug. 5, 1997, 111 Stat. 1057; Pub. L. 106-170,

title V, Sec. 571(a), Dec. 17, 1999, 113 Stat. 1950; Pub. L.

106-554, Sec. 1(a)(7) [title III, Sec. 319(21)], Dec. 21, 2000, 114

Stat. 2763, 2763A-647.)

-MISC1-

AMENDMENTS

2000 - Subsec. (e)(5)(A), (B). Pub. L. 106-554 substituted

"subsection (d)(5)" for "subsections (d)(5) and (l)(3)(B)".

1999 - Subsec. (e)(5). Pub. L. 106-170 added par. (5).

1997 - Subsec. (g)(3). Pub. L. 105-34 inserted at end "In the

case of a private foundation, subsection (c)(2) shall be applied by

substituting 'May 15' for 'April 15'."

1996 - Subsec. (g)(3). Pub. L. 104-188, Sec. 1703(h), in closing

provisions, substituted ", subsection (e)(2)(A) shall be applied by

substituting '2 months' for '3 months' in clause (i)(I), the

election under clause (i) of subsection (e)(2)(C) may be made

separately for each installment, and clause (ii) of subsection

(e)(2)(C) shall not apply." for ", and, except in the case of an

election under subsection (e)(2)(C), subsection (e)(2)(A) shall be

applied by substituting '2 months' for '3 months' and in clause

(i)(I), by substituting '4 months' for '5 months' in clause

(i)(II), by substituting '7 months' for '8 months' in clause

(i)(III), and by substituting '10 months' for '11 months' in clause

(i)(IV)."

1994 - Subsec. (e)(4). Pub. L. 103-465 added par. (4).

1993 - Subsec. (d)(1)(B)(i). Pub. L. 103-66, Sec. 13225(a)(1),

substituted "100 percent" for "91 percent" in two places.

Subsec. (d)(2). Pub. L. 103-66, Sec. 13225(a)(2)(A)(ii),

substituted "100 percent" for "91 percent" in heading.

Subsec. (d)(3). Pub. L. 103-66, Sec. 13225(a)(2)(A)(i), struck

out heading and text of par. (3). Text read as follows: "In the

case of any taxable year beginning after June 30, 1992, and before

1997 -

"(A) paragraph (1)(B)(i) and subsection (e)(3)(A)(i) shall be

applied by substituting '97 percent' for '91 percent' each place

it appears, and

"(B) the table contained in subsection (e)(2)(B)(ii) shall be

applied by substituting '24.25', '48.50', '72.75', and '97' for

'22.75', '45.50', '68.25', and '91.00', respectively."

Subsec. (e)(2)(A)(i)(II). Pub. L. 103-66, Sec. 13225(b)(1)(A),

struck out "or for the first 5 months" after "3 months".

Subsec. (e)(2)(A)(i)(III). Pub. L. 103-66, Sec. 13225(b)(1)(B),

struck out "or for the first 8 months" after "6 months".

Subsec. (e)(2)(A)(i)(IV). Pub. L. 103-66, Sec. 13225(b)(1)(C),

struck out "or for the first 11 months" after "9 months".

Subsec. (e)(2)(B)(ii). Pub. L. 103-66, Sec. 13225(a)(2)(B), in

table, substituted applicable percentages of 25, 50, 75, and 100

for 22.75, 45.50, 68.25, and 91.00, respectively, in 1st, 2nd, 3rd,

and 4th installments.

Subsec. (e)(2)(C). Pub. L. 103-66, Sec. 13225(b)(2), added

subpar. (C).

Subsec. (e)(3)(A)(i). Pub. L. 103-66, Sec. 13225(a)(2)(C),

substituted "100 percent" for "91 percent".

Subsec. (g)(3). Pub. L. 103-66, Sec. 13225(b)(3), substituted

"and, except in the case of an election under subsection (e)(2)(C),

subsection (e)(2)(A)" for "and subsection (e)(2)(A)" in last

sentence.

1992 - Subsec. (d)(1)(B)(i). Pub. L. 102-318, Sec. 512(a)(1),

substituted "91 percent" for "90 percent" in two places.

Subsec. (d)(2). Pub. L. 102-318, Sec. 512(a)(2), substituted "91

percent" for "90 percent" in heading.

Subsec. (d)(3). Pub. L. 102-318, Sec. 512(a)(3), added par. (3)

and struck out former par. (3) which related to temporary increase

in amount of installment method based on current tax year for

taxable years beginning after 1991 and before 1997.

Subsec. (d)(3)(A). Pub. L. 102-244, amended table generally,

substituting a single entry "1993 through 1996 . . . . . 95" for

former arrangement under which years after 1992 were covered by two

table entries: "1993 or 1994 . . . . . 94" and "1995 or 1996 . . .

. . 95".

Subsec. (e)(2)(B)(ii). Pub. L. 102-318, Sec. 512(b)(1), in table,

substituted applicable percentages of 22.75, 45.50, 68.25, and

91.00 for 22.5, 45, 67.5, and 90, respectively, in 1st, 2nd, 3rd

and 4th installments.

Subsec. (e)(3)(A)(i). Pub. L. 102-318, Sec. 512(b)(2),

substituted "91 percent" for "90 percent".

1991 - Subsec. (d)(3). Pub. L. 102-227, Sec. 201(a), added par.

(3).

Subsec. (e)(1). Pub. L. 102-227, Sec. 201(b), substituted

"paragraphs (2) and (3) of subsection (d)" for "subsection (d)(2)".

1990 - Subsec. (g)(3). Pub. L. 101-508 inserted a period at end

of last sentence.

1989 - Subsec. (e)(1). Pub. L. 101-239, Sec. 7822(a), substituted

"under subsection (d)(1)" for "under section (d)(1)".

Subsec. (g)(4). Pub. L. 101-239, Sec. 7209(a), added par. (4).

1988 - Subsec. (e)(1). Pub. L. 100-647, Sec. 5001(a), struck out

at end "A reduction shall be treated as recaptured for purposes of

subparagraph (B) if 90 percent of the reduction is recaptured."

Subsec. (g)(1)(B). Pub. L. 100-418 amended subpar. (B) generally.

Prior to amendment, subpar. (B) read as follows: "the sum of -

"(i) the credits against tax provided by part IV of subchapter

A of chapter 1, plus

"(ii) to the extent allowed under regulations prescribed by the

Secretary, any overpayment of the tax imposed by section 4986

(determined without regard to section 4995(a)(4)(B))."

Subsec. (g)(3). Pub. L. 100-647, Sec. 2004(r), inserted last

sentence, and struck out former last sentence which read as

follows: "In the case of any organization described in subparagraph

(A), subsection (b)(2)(A) shall be applied by substituting '5th

month' for '3rd month'."

1987 - Pub. L. 100-203 amended section generally, revising and

restating as subsecs. (a) to (j) provisions of former subsecs. (a)

to (i).

1986 - Subsec. (a)(1). Pub. L. 99-514, Sec. 1511(c)(15),

substituted "the underpayment rate established under section 6621"

for "the rate established under section 6621".

Subsec. (f)(1). Pub. L. 99-514, Sec. 701(d)(3), amended par. (1)

generally, restating existing provisions in subpar. (A) and adding

subpar. (B).

Pub. L. 99-499 amended subsec. (f)(1), as amended by the Tax

Reform Act of 1986 (Pub. L. 99-514), by striking out "plus" at end

of subpar. (A), substituting "plus" for "over" at end of subpar.

(B), and adding subpar. (C).

1983 - Subsec. (f)(2)(B). Pub. L. 97-448 amended subpar. (B)

generally. Prior to amendment, subpar. (B) read as follows: "to the

extent allowed under regulations prescribed by the Secretary, any

amount which is treated under section 6429 as an overpayment of the

tax imposed by section 4986". Notwithstanding directory language

that amendment be made to subsec. (e)(2)(B), the amendment was

executed to subsec. (f)(2)(B) to reflect the probable intent of

Congress, the intervening redesignation of subsec. (e) as (f) by

Pub. L. 97-248, and the retrospective effect of the amendment as

provided by section 203(a), (b) of Pub. L. 97-448, set out as an

Effective Date of 1983 Amendment note under section 4988 of this

title.

1982 - Subsec. (a). Pub. L. 97-248, Sec. 234(c), in heading

substituted "Addition to tax" for "Addition to the tax", in

provisions preceding par. (1) inserted reference to subsec. (e) as

an exception and struck out "estimated" before "tax", designated

existing provisions as par. (1), and in par. (1) as so designated

struck out parenthetical reference to subsecs. (b) and (c) for

determination of the amount of the underpayment and the period of

the underpayment, respectively, and added par. (2).

Subsec. (b)(1). Pub. L. 97-248, Sec. 234(a)(1), substituted "90"

for "80" wherever appearing.

Subsec. (d)(3)(A). Pub. L. 97-248, Sec. 234(a)(2), substituted

"90" for "80".

Subsec. (e). Pub. L. 97-248, Sec. 234(d)(1), added subsec. (e).

Former subsec. (e) redesignated (f).

Subsec. (f). Pub. L. 97-248, Sec. 234(d), redesignated former

subsec. (e) as (f) and substituted references to subsecs. (e) and

(i) for references to subsec. (h). Former subsec. (f) redesignated

(g).

Subsecs. (g) to (i). Pub. L. 97-248, Sec. 234(d)(1), redesignated

former subsecs. (f) to (h) as (g) to (i), respectively.

1981 - Subsec. (e)(2). Pub. L. 97-34, Sec. 601(a)(6)(B), inserted

"the sum of - ", designated existing provisions as subpar. (A),

inserted at end of subpar. (A) ", plus", and added subpar. (B).

Subsec. (h). Pub. L. 97-34, Sec. 731(a), (b), substituted in

heading "minimum percentage" for "at least 60 percent" and

provisions of par. (1) respecting minimum percentage, for

provisions respecting in the case of a large corporation, the

amount treated as the estimated tax for the taxable year under

paragraphs (1) and (2) of subsection (d) shall in no event be less

than 60 percent of the tax shown on the return for the taxable

year, or if no return was filed, the tax for such year.

1980 - Subsec. (e). Pub. L. 96-499, Sec. 1111(b), substituted

"subsections (b), (d), and (h)" for "subsections (b) and (d)".

Subsec. (h). Pub. L. 96-499, Sec. 1111(a), added subsec. (h).

1978 - Subsec. (e). Pub. L. 95-600 struck out provisions relating

to the corporation's temporary estimated tax exemption.

1976 - Subsec. (e)(1)(B). Pub. L. 94-455, Sec. 1906(b)(3)(A),

struck out in cl. (ii) "after December 31, 1967, and" after

"taxable year beginning" and struck out cl. (iii) which related to

the case of a taxable year beginning after Dec. 31, 1967, and

before Jan. 1, 1972, the amount of the corporation's transitional

exemption for such year.

Subsec. (e)(2)(B). Pub. L. 94-455, Sec. 1906(b)(3)(B),

substituted "clause (ii)" for "clauses (ii) and (iii)".

Subsec. (e)(3), (4). Pub. L. 94-455, Sec. 1906(b)(3)(C)(i),

redesignated par. (4) as (3). Former par. (3), which related to the

computation of a corporation's transitional exemption, was struck

out.

Subsec. (f). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck out "or

his delegate" after "Secretary".

1975 - Subsecs. (a), (g)(1). Pub. L. 93-625 substituted "an

annual rate established under section 6621" for "the rate of 6

percent per annum".

1968 - Subsec. (b)(1). Pub. L. 90-364, Sec. 103(c)(1),

substituted "80 percent" for "70 percent".

Subsec. (d)(1). Pub. L. 90-364, Sec. 103(e)(1), struck out

"reduced by $100,000" after "The tax shown on the return of the

corporation for the preceding taxable year".

Subsec. (d)(3)(A). Pub. L. 90-364, Sec. 103(c)(1), substituted

"80 percent" for "70 percent".

Subsec. (e). Pub. L. 90-364, Sec. 103(c)(2), designated existing

provisions as par. (1) under a heading "In general", in such

redesignated par. (1) substituted "For purposes of subsections (b)

and (d)" for "For purposes of subsections (b), (d)(2), and (d)(3)"

in introductory text, redesignated as subpar. (A) former par. (1)

and as subpar. (B) former par. (2), struck out reference to

$100,000 as one factor in the sum required for redesignated subpar.

(B) and added cls. (ii) and (iii), and added pars. (2), (3), and

(4) under headings "Temporary estimated tax exemption",

"Transitional exemption", and "Special rule for subsection (d)(1)

and (2)" respectively.

Subsec. (g). Pub. L. 90-364, Sec. 103(d)(2), added subsec. (g).

1964 - Subsec. (c)(2). Pub. L. 88-272, Sec. 122(c)(1),

substituted "any installment date" and "such installment date" for

"the 15th day of the 12th month".

Subsec. (d)(3). Pub. L. 88-272, Sec. 122(c)(2), redesignated cls.

(A)(i) and (ii) as (A)(iii) and (iv), respectively, added cls.

(A)(i) and (ii), and substituted "(3, 5, 6, 8, 9,)" for "(6 or 8,

or 9)" in subpar. (B)(ii).

EFFECTIVE DATE OF 1999 AMENDMENT

Pub. L. 106-170, title V, Sec. 571(b), Dec. 17, 1999, 113 Stat.

1951, provided that: "The amendment made by subsection (a)

[amending this section] shall apply to estimated tax payments due

on or after December 15, 1999."

EFFECTIVE DATE OF 1997 AMENDMENT

Section 1461(b) of Pub. L. 105-34 provided that: "The amendment

made by subsection (a) [amending this section] shall apply for

purposes of determining underpayments of estimated tax for taxable

years beginning after the date of the enactment of this Act [Aug.

5, 1997]."

EFFECTIVE DATE OF 1996 AMENDMENT

Amendment by Pub. L. 104-188 effective as if included in the

provision of the Revenue Reconciliation Act of 1993, Pub. L.

103-66, Secs. 13001-13444, to which such amendment relates, see

section 1703(o) of Pub. L. 104-188, set out as a note under section

39 of this title.

EFFECTIVE DATE OF 1994 AMENDMENT

Amendment by Pub. L. 103-465 applicable for purposes of

determining underpayments of estimated tax for taxable years

beginning after Dec. 31, 1994, see section 711(c) of Pub. L.

103-465, set out as a note under section 6654 of this title.

EFFECTIVE DATE OF 1993 AMENDMENT

Section 13225(c) of Pub. L. 103-66 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1993."

EFFECTIVE DATE OF 1992 AMENDMENTS

Section 512(c) of Pub. L. 102-318 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after June 30, 1992."

Section 3(b) of Pub. L. 102-244 provided that: "The amendment

made by subsection (a) [amending this section] shall apply to

taxable years beginning after December 31, 1992."

EFFECTIVE DATE OF 1991 AMENDMENT

Section 201(c) of Pub. L. 102-227 provided that: "The amendments

made by subsection (a) [amending this section] shall apply to

taxable years beginning after December 31, 1991."

EFFECTIVE DATE OF 1989 AMENDMENT

Section 7209(b) of Pub. L. 101-239 provided that: "The amendment

made by subsection (a) [amending this section] shall apply to

taxable years beginning after December 31, 1989."

Amendment by section 7822(a) of Pub. L. 101-239 effective as if

included in the provision of the Revenue Act of 1987, Pub. L.

100-203, title X, to which such amendment relates, see section 7823

of Pub. L. 101-239, set out as a note under section 26 of this

title.

EFFECTIVE DATE OF 1988 AMENDMENTS

Amendment by section 2004(r) of Pub. L. 100-647 effective, except

as otherwise provided, as if included in the provision of the

Revenue Act of 1987, Pub. L. 100-203, title X, to which such

amendment relates, see section 2004(u) of Pub. L. 100-647, set out

as a note under section 56 of this title.

Section 5001(b) of Pub. L. 100-647 provided that: "The amendment

made by subsection (a) [amending this section] shall apply to

installments required to be made after December 31, 1988."

Amendment by Pub. L. 100-418 applicable to crude oil removed from

the premises on or after Aug. 23, 1988, see section 1941(c) of Pub.

L. 100-418, set out as a note under section 164 of this title.

EFFECTIVE DATE OF 1987 AMENDMENT

Amendment by Pub. L. 100-203 applicable to taxable years

beginning after Dec. 31, 1987, see section 10301(c) of Pub. L.

100-203, set out as a note under section 585 of this title.

EFFECTIVE DATE OF 1986 AMENDMENTS

Amendment by section 701(d)(3) of Pub. L. 99-514 applicable to

taxable years beginning after Dec. 31, 1986, with certain

exceptions and qualifications, see section 701(f) of Pub. L.

99-514, set out as an Effective Date note under section 55 of this

title.

Amendment by section 1511(c)(15) of Pub. L. 99-514 applicable for

purposes of determining interest for periods after Dec. 31, 1986,

see section 1511(d) of Pub. L. 99-514, set out as a note under

section 47 of this title.

Amendment by Pub. L. 99-499 applicable to taxable years beginning

after Dec. 31, 1986, see section 516(c) of Pub. L. 99-499, set out

as a note under section 26 of this title.

EFFECTIVE DATE OF 1983 AMENDMENT

Amendment by Pub. L. 97-448 effective, except as otherwise

provided, as if it had been included in the provision of the Crude

Oil Windfall Profit Tax Act of 1980, Pub. L. 96-223, to which such

amendment relates, see section 203(a), (b) of Pub. L. 97-448, set

out as a note under section 6652 of this title.

EFFECTIVE DATE OF 1982 AMENDMENT

Section 234(e) of Pub. L. 97-248 provided that: "The amendments

made by this section [amending this section and sections 832, 6081,

6152, and 6164 of this title] shall apply to taxable years

beginning after December 31, 1982."

EFFECTIVE DATE OF 1981 AMENDMENT

Amendment by section 601(a)(6)(B) of Pub. L. 97-34 effective Jan.

1, 1980, see section 601(c)(2) of Pub. L. 97-34, set out as a note

under section 6654 of this title.

Section 731(c) of Pub. L. 97-34 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1981."

EFFECTIVE DATE OF 1980 AMENDMENT

Section 1111(c) of Pub. L. 96-499 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1980."

EFFECTIVE DATE OF 1978 AMENDMENT

Amendment by Pub. L. 95-600 applicable to taxable years beginning

after Dec. 31, 1978, see section 301(c) of Pub. L. 95-600, set out

as a note under section 11 of this title.

EFFECTIVE DATE OF 1976 AMENDMENT

Amendment by section 1906(b)(3)(A)-(C)(i) of Pub. L. 94-455

effective with respect to taxable years after Dec. 31, 1976, see

section 1906(d)(2) of Pub. L. 94-455, set out as a note under

section 6013 of this title.

EFFECTIVE DATE OF 1975 AMENDMENT

Amendment by Pub. L. 93-625 effective July 1, 1975, and

applicable to amounts outstanding on such date or arising

thereafter, see section 7(e) of Pub. L. 93-625, set out as an

Effective Date note under section 6621 of this title.

EFFECTIVE DATE OF 1968 AMENDMENT

Amendment by Pub. L. 90-364 applicable with respect to taxable

years beginning after Dec. 31, 1967, except as provided by section

104 of Pub. L. 90-364, see section 103(f) of Pub. L. 90-364, set

out as a note under section 243 of this title.

EFFECTIVE DATE OF 1964 AMENDMENT

Amendment by Pub. L. 88-272 effective, except for purposes of

section 21 of this title, with respect to taxable years beginning

after Dec. 31, 1963, see section 131 of Pub. L. 88-272, set out as

a note under section 1 of this title.

TIME FOR PAYMENT OF SEPTEMBER 2001 AND SEPTEMBER 2004 CORPORATE

ESTIMATED TAXES

Pub. L. 107-16, title VIII, Sec. 801, June 7, 2001, 115 Stat.

148, provided that: "Notwithstanding section 6655 of the Internal

Revenue Code of 1986 -

"(1) 100 percent of the amount of any required installment of

corporate estimated tax which is otherwise due in September 2001

shall not be due until October 1, 2001; and

"(2) 20 percent of the amount of any required installment of

corporate estimated tax which is otherwise due in September 2004

shall not be due until October 1, 2004."

WAIVER OF ESTIMATED TAX PENALTIES FOR 1998 UNDERPAYMENTS

No addition to tax to be made under this section with respect to

any underpayment of an installment required to be paid on or before

the 30th day after July 22, 1998, to the extent such underpayment

was created or increased by any provision of Pub. L. 105-206, see

section 1(c) of Pub. L. 105-206, set out as a note under section

6654 of this title.

No addition to tax to be made under this section for any period

before Jan. 1, 1998, for any payment the due date of which is

before Jan. 16, 1998, with respect to any underpayment attributable

to such period to the extent such underpayment was created or

increased by any provision of Pub. L. 105-34, see section 1(d) of

Pub. L. 105-34, set out as a note under section 6654 of this title.

UNDERPAYMENTS OF ESTIMATED TAX FOR 1996

No addition to tax to be made under this section with respect to

any underpayment of an installment required to be paid before Aug.

20, 1996, to the extent such underpayment was created or increased

by any provision of title I (Secs. 1101-1954) of Pub. L. 104-188,

see section 1102 of Pub. L. 104-188, set out as a note under

section 6654 of this title.

WAIVER OF ESTIMATED PENALTIES FOR 1993 UNDERPAYMENTS ATTRIBUTABLE

TO REVENUE RECONCILIATION ACT OF 1993

No addition to tax to be made under this section for any period

before Apr. 16, 1994 (Mar. 16, 1994, in the case of a corporation),

with respect to any underpayment to the extent such underpayment

was created or increased by any provision of chapter 1 (Secs.

13001-13444) of title XIII of Pub. L. 103-66, see section 13001(d)

of Pub. L. 103-66, set out as a note under section 6654 of this

title.

WAIVER OF ESTIMATED TAX PENALTIES FOR UNDERPAYMENTS ATTRIBUTABLE TO

SECTION 420(B)(4)(B) OF THIS TITLE

No addition to tax to be made under this section for taxable year

preceding taxpayer's first taxable year beginning after Dec. 31,

1990, with respect to any underpayment to the extent such

underpayment was created or increased by reason of section

420(b)(4)(B) of this title, see section 12011(c)(2) of Pub. L.

101-508, set out as an Effective Date note under section 420 of

this title.

WAIVER OF ESTIMATED PENALTIES FOR 1990 UNDERPAYMENTS ATTRIBUTABLE

TO REVENUE RECONCILIATION ACT OF 1990

Section 11307 of Pub. L. 101-508 provided that: "No addition to

tax shall be made under section 6655 of the Internal Revenue Code

of 1986 for any period before March 16, 1991, with respect to any

underpayment to the extent such underpayment was created or

increased by any provision of this part [part I (Secs. 11301-11307)

of subtitle C of title XI of Pub. L. 101-508, see Tables for

classification]."

APPLICABILITY OF CERTAIN AMENDMENTS BY PUB. L. 99-514 IN RELATION

TO TREATY OBLIGATIONS OF UNITED STATES

For applicability of amendment by section 701(d)(3) of Pub. L.

99-514 notwithstanding any treaty obligation of the United States

in effect on Oct. 22, 1986, see section 1012(aa)(2) of Pub. L.

100-647, set out as a note under section 861 of this title.

WAIVER OF ESTIMATED PENALTIES FOR 1988 UNDERPAYMENTS ATTRIBUTABLE

TO TECHNICAL AND MISCELLANEOUS REVENUE ACT OF 1988

No addition to tax to be made under this section for any period

before Mar. 16, 1989, with respect to any underpayment to the

extent such underpayment was created or increased by any provision

of title I (Secs. 1001 to 1019) or II (Secs. 2001 to 2006) of Pub.

L. 100-647, see section 1019(b) of Pub. L. 100-647, set out as an

Effective Date of 1988 Amendment note under section 1 of this

title.

CORPORATIONS ALSO MAY USE 1986 TAX TO DETERMINE AMOUNT OF CERTAIN

ESTIMATED TAX INSTALLMENTS DUE ON OR BEFORE JUNE 15, 1987

Section 10303(b)(2) of Pub. L. 100-203 provided that:

"(A) In general. - In the case of a large corporation, no

addition to tax shall be imposed by section 6655 of the Internal

Revenue Code of 1986 with respect to any underpayment of an

estimated tax installment to which this subsection applies if no

addition would be imposed with respect to such underpayment by

reason of section 6655(d)(1) of such Code if such corporation were

not a large corporation. The preceding sentence shall apply only to

the extent the underpayment is paid on or before the last date

prescribed for payment of the most recent installment of estimated

tax due on or before September 15, 1987.

"(B) Installment to which subsection applies. - This subsection

applies to any installment of estimated tax for a taxable year

beginning after December 31, 1986, which is due on or before June

15, 1987.

"(C) Large corporation. - For purposes of this subsection, the

term 'large corporation' has the meaning given such term by section

6655(i)(2) of such Code (as in effect on the day before the date of

the enactment of this Act [Dec. 22, 1987])."

WAIVER OF ESTIMATED PENALTIES FOR 1986 UNDERPAYMENTS ATTRIBUTABLE

TO TAX REFORM ACT OF 1986

No addition to tax to be made under this section for any period

before Mar. 16, 1987, with respect to any underpayment, to the

extent such underpayment was created or increased by any provision

of Pub. L. 99-514, see section 1543 of Pub. L. 99-514, set out as a

note under section 6654 of this title.

WAIVER OF ESTIMATED TAX PENALTIES

Section 1879(a) of Pub. L. 99-514 provided that: "No addition to

tax shall be made under section 6654 or 6655 of the Internal

Revenue Code of 1954 [now 1986] (relating to failure to pay

estimated income tax) for any period before April 16, 1985 (March

16, 1985 in the case of a taxpayer subject to section 6655 of such

Code), with respect to any underpayment, to the extent that such

underpayment was created or increased by any provision of the Tax

Reform Act of 1984 [Pub. L. 98-369, div. A]."

UNDERPAYMENTS OF ESTIMATED TAX FOR 1984

Pub. L. 98-369, div. A, title II, subtitle A, Sec. 218, July 18,

1984, 98 Stat. 766, which provided that no addition to the tax

shall be made under section 6655 of this title with respect to any

underpayment of an installment required to be paid before July 18,

1984, to the extent such underpayment was created or increased by

any provision of this subtitle, and such underpayment was paid in

full on or before the last date prescribed for payment of the first

installment of estimated tax required to be paid after July 18,

1984, was repealed by Pub. L. 99-514, title XVIII, Sec. 1824, Oct.

22, 1986, 100 Stat. 2846.

WAIVER OF PENALTY FOR UNDERPAYMENT OF ESTIMATED TAX

Section 803(g) of Pub. L. 94-455, as amended by Pub. L. 99-514,

Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that: "If -

"(1) a corporation made underpayments of estimated tax for a

taxable year of the corporation which includes August 1, 1975,

because the corporation intended to elect to have the provisions

of subparagraph (B) of section 46(a)(1) of the Internal Revenue

Code of 1986 [formerly I.R.C. 1954] (as it existed before the

date of enactment of this Act [Oct. 4, 1976]) apply for such

taxable year, and

"(2) the corporation does not elect to have the provisions of

such subparagraph apply for such taxable year because this Act

does not contain the amendments made by section 804(a)(2)

(relating to flowthrough of investment credit), or the provisions

of subsection (f) of such section (relating to grace period for

certain plan transfers), of the bill H.R. 10612 (94th Congress,

2d Session), as amended by the Senate,

then the provisions of section 6655 of such Code (relating to

failure by corporation to pay estimated income tax) shall not apply

to so much of any such underpayment as the corporation can

establish, to the satisfaction of the Secretary of the Treasury, is

properly attributable to the inapplicability of such subparagraph

(B) for such taxable year."

DECLARATION OF ESTIMATED TAX

With respect to taxable years beginning before Dec. 30, 1969, if

a taxpayer is required to make a declaration, or to pay any amount

of estimated tax by reason of amendments made by Pub. L. 91-172,

such amount shall be paid ratably on each of the remaining

installment dates for the taxable year beginning with the first

installment date on or after Dec. 30, 1969; as to any declaration

or payment of estimated tax before the first installment date, this

section, and sections 6015, 6154, and 6654 of this title shall be

applied without regard to amendments made by Pub. L. 91-172, see

section 946(b) of Pub. L. 91-172, set out as a note under section

6153 of this title.

TAX SURCHARGE EXTENSION; DECLARATIONS OF ESTIMATED TAX

Requirement of making a declaration or amended declaration of

estimated tax or of payment of any amount or additional amount of

estimated tax by reason of amendment of sections 51(a)(1)(A), (B),

(2)(A) and 963(b) of this title as calling for payment of such

amount or additional amount ratably on or before each of remaining

installment dates for taxable year beginning with installment date

on or after the 30th day after Aug. 7, 1969; application of this

section without regard to such amendment with respect to any

declaration or payment of estimated tax before such first

installment date; and definition of "installment date", see Pub. L.

93-53, Sec. 5(c), Aug. 7, 1969, 83 Stat. 95.

ESTIMATED TAX OF LIFE INSURANCE COMPANIES FOR 1958

Pub. L. 86-69, June 25, 1959, Sec. 3(h), 73 Stat. 140, provided

that in the case of a taxpayer subject to tax under section 811 of

this title, as in effect before June 25, 1959, no additional tax

was to be payable under this section with respect to estimated tax

for a taxable year beginning in 1958.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 167, 338, 460, 585, 809,

847, 1446, 6201, 6425, 6601, 6622, 6651, 6658, 6665, 6751, 7203,

7704 of this title.

-End-

-CITE-

26 USC Sec. 6656 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6656. Failure to make deposit of taxes

-STATUTE-

(a) Underpayment of deposits

In the case of any failure by any person to deposit (as required

by this title or by regulations of the Secretary under this title)

on the date prescribed therefor any amount of tax imposed by this

title in such government depository as is authorized under section

6302(c) to receive such deposit, unless it is shown that such

failure is due to reasonable cause and not due to willful neglect,

there shall be imposed upon such person a penalty equal to the

applicable percentage of the amount of the underpayment.

(b) Definitions

For purposes of subsection (a) -

(1) Applicable percentage

(A) In general

Except as provided in subparagraph (B), the term "applicable

percentage" means -

(i) 2 percent if the failure is for not more than 5 days,

(ii) 5 percent if the failure is for more than 5 days but

not more than 15 days, and

(iii) 10 percent if the failure is for more than 15 days.

(B) Special rule

In any case where the tax is not deposited on or before the

earlier of -

(i) the day 10 days after the date of the first delinquency

notice to the taxpayer under section 6303, or

(ii) the day on which notice and demand for immediate

payment is given under section 6861 or 6862 or the last

sentence of section 6331(a),

the applicable percentage shall be 15 percent.

(2) Underpayment

The term "underpayment" means the excess of the amount of the

tax required to be deposited over the amount, if any, thereof

deposited on or before the date prescribed therefor.

(c) Exception for first-time depositors of employment taxes

The Secretary may waive the penalty imposed by subsection (a) on

a person's inadvertent failure to deposit any employment tax if -

(1) such person meets the requirements referred to in section

7430(c)(4)(A)(ii),

(2) such failure -

(A) occurs during the first quarter that such person was

required to deposit any employment tax; or

(B) if such person is required to change the frequency of

deposits of any employment tax, relates to the first deposit to

which such change applies, and

(3) the return of such tax was filed on or before the due date.

For purposes of this subsection, the term "employment taxes" means

the taxes imposed by subtitle C.

(d) Authority to abate penalty where deposit sent to Secretary

The Secretary may abate the penalty imposed by subsection (a)

with respect to the first time a depositor is required to make a

deposit if the amount required to be deposited is inadvertently

sent to the Secretary instead of to the appropriate government

depository.

(e) Designation of periods to which deposits apply

(1) In general

A deposit made under this section shall be applied to the most

recent period or periods within the specified tax period to which

the deposit relates, unless the person making such deposit

designates a different period or periods to which such deposit is

to be applied.

(2) Time for making designation

A person may make a designation under paragraph (1) only during

the 90-day period beginning on the date of a notice that a

penalty under subsection (a) has been imposed for the specified

tax period to which the deposit relates.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 826; Pub. L. 91-172, title IX,

Sec. 943(b), Dec. 30, 1969, 83 Stat. 728; Pub. L. 94-455, title

XIX, Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L.

97-34, title VII, Sec. 724(a), (b)(1), (3), Aug. 13, 1981, 95 Stat.

344, 345; Pub. L. 99-509, title VIII, Sec. 8001(a), Oct. 21, 1986,

100 Stat. 1951; Pub. L. 101-239, title VII, Sec. 7742(a), Dec. 19,

1989, 103 Stat. 2405; Pub. L. 104-168, title III, Sec. 304(a),

title VII, Sec. 701(c)(3), July 30, 1996, 110 Stat. 1458, 1464;

Pub. L. 105-206, title III, Sec. 3304(a)-(c), July 22, 1998, 112

Stat. 742.)

-MISC1-

AMENDMENTS

1998 - Subsec. (c)(2). Pub. L. 105-206, Sec. 3304(b)(1), amended

par. (2) generally. Prior to amendment, par. (2) read as follows:

"such failure occurs during the 1st quarter that such person was

required to deposit any employment tax, and".

Subsec. (e). Pub. L. 105-206, Sec. 3304(a), added subsec. (e).

Subsec. (e)(1). Pub. L. 105-206, Sec. 3304(c), reenacted heading

without change and amended text of par. (1) generally. Prior to

amendment, text read as follows: "A person may, with respect to any

deposit of tax to be reported on such person's return for a

specified tax period, designate the period or periods within such

specified tax period to which the deposit is to be applied for

purposes of this section."

1996 - Subsec. (c). Pub. L. 104-168, Sec. 304(a), added subsec.

(c).

Subsec. (c)(1). Pub. L. 104-168, Sec. 701(c)(3), substituted

"section 7430(c)(4)(A)(ii)" for "section 7430(c)(4)(A)(iii)".

Subsec. (d). Pub. L. 104-168, Sec. 304(a), added subsec. (d).

1989 - Pub. L. 101-239 substituted "taxes" for "taxes or

overstatement of deposits" as section catchline and amended text

generally, revising substance and structure.

1986 - Subsec. (a). Pub. L. 99-509 substituted "10 percent" for

"5 percent".

1981 - Pub. L. 97-34, Sec. 724(b)(1), inserted "or overstatement

of deposits" after "taxes" in section catchline.

Subsec. (a). Pub. L. 97-34, Sec. 724(b)(3), substituted

"Underpayment of deposits" for "Penalty" in heading.

Subsec. (b). Pub. L. 97-34, Sec. 724(a), substituted provisions

relating to conditions for imposition of penalties for overstated

deposit claims and definition of "overstated deposit claim", for

provisions relating to imposition of penalties after due date for

return.

1976 - Subsec. (a). Pub. L. 94-455 struck out "or his delegate"

after "Secretary".

1969 - Subsec. (a). Pub. L. 91-172 substituted provisions

imposing a penalty of five percent for the failure to deposit on

the date prescribed any amount of tax imposed by this title, for

provisions imposing a penalty of one percent of the amount of

underpayment each month but not to exceed six percent in the

aggregate.

EFFECTIVE DATE OF 1998 AMENDMENT

Pub. L. 105-206, title III, Sec. 3304(d), July 22, 1998, 112

Stat. 742, provided that:

"(1) In general. - The amendments made by this section [amending

this section] shall apply to deposits required to be made after the

180th day after the date of the enactment of this Act [July 22,

1998].

"(2) Application to current liabilities. - The amendment made by

subsection (c) [amending this section] shall apply to deposits

required to be made after December 31, 2001."

EFFECTIVE DATE OF 1996 AMENDMENT

Section 304(b) of Pub. L. 104-168 provided that: "The amendment

made by subsection (a) [amending this section] shall apply to

deposits required to be made after the date of the enactment of

this Act [July 30, 1996]."

Amendment by section 701(c)(3) of Pub. L. 104-168 applicable in

case of proceedings commenced after July 30, 1996, see section

701(d) of Pub. L. 104-168, set out as a note under section 6404 of

this title.

EFFECTIVE DATE OF 1989 AMENDMENT

Section 7742(c) of Pub. L. 101-239 provided that: "The amendments

made by this section [amending this section] shall apply to

deposits required to be made after December 31, 1989."

EFFECTIVE DATE OF 1986 AMENDMENT

Section 8001(b) of Pub. L. 99-509 provided that: "The amendment

made by subsection (a) [amending this section] shall apply to

penalties assessed after the date of the enactment of this Act

[Oct. 21, 1986]."

EFFECTIVE DATE OF 1981 AMENDMENT

Section 724(c) of Pub. L. 97-34 provided that: "The amendments

made by this section [amending this section and sections 5684 and

5761 of this title] shall apply to returns filed after the date of

the enactment of this Act [Aug. 13, 1981]."

EFFECTIVE DATE OF 1969 AMENDMENT

Amendment by Pub. L. 91-172 applicable with respect to deposits

the time for making of which is after Dec. 31, 1969, see section

943(d) of Pub. L. 91-172, set out as a note under section 6651 of

this title.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 5684, 5761 of this title.

-End-

-CITE-

26 USC Sec. 6657 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6657. Bad checks

-STATUTE-

If any check or money order in payment of any amount receivable

under this title is not duly paid, in addition to any other

penalties provided by law, there shall be paid as a penalty by the

person who tendered such check, upon notice and demand by the

Secretary, in the same manner as tax, an amount equal to 2 percent

of the amount of such check, except that if the amount of such

check is less than $750, the penalty under this section shall be

$15 or the amount of such check, whichever is the lesser. This

section shall not apply if the person tendered such check in good

faith and with reasonable cause to believe that it would be duly

paid.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 826; Pub. L. 94-455, title XIX,

Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 100-647,

title V, Sec. 5071(a), Nov. 10, 1988, 102 Stat. 3681.)

-MISC1-

AMENDMENTS

1988 - Pub. L. 100-647 substituted "2" for "1", "$750" for

"$500", and "$15" for "$5".

1976 - Pub. L. 94-455 struck out "or his delegate" after

"Secretary".

EFFECTIVE DATE OF 1988 AMENDMENT

Section 5071(b) of Pub. L. 100-647 provided that: "The amendment

made by subsection (a) [amending this section] shall apply to

checks or money orders received after the date of the enactment of

this Act [Nov. 10, 1988]."

-End-

-CITE-

26 USC Sec. 6658 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6658. Coordination with title 11

-STATUTE-

(a) Certain failures to pay tax

No addition to the tax shall be made under section 6651, 6654, or

6655 for failure to make timely payment of tax with respect to a

period during which a case is pending under title 11 of the United

States Code -

(1) if such tax was incurred by the estate and the failure

occurred pursuant to an order of the court finding probable

insufficiency of funds of the estate to pay administrative

expenses, or

(2) if -

(A) such tax was incurred by the debtor before the earlier of

the order for relief or (in the involuntary case) the

appointment of a trustee, and

(B)(i) the petition was filed before the due date prescribed

by law (including extensions) for filing a return of such tax,

or

(ii) the date for making the addition to the tax occurs on or

after the day on which the petition was filed.

(b) Exception for collected taxes

Subsection (a) shall not apply to any liability for an addition

to the tax which arises from the failure to pay or deposit a tax

withheld or collected from others and required to be paid to the

United States.

-SOURCE-

(Added Pub. L. 96-589, Sec. 6(e)(1), Dec. 24, 1980, 94 Stat. 3408.)

-MISC1-

PRIOR PROVISIONS

A prior section 6658, act Aug. 16, 1954, ch. 736, 68A Stat. 826,

authorized inclusion as part of the tax a 25 percent penalty in

cases of violations or attempted violations of section 6851 of this

title, prior to repeal by Pub. L. 96-167, Sec. 6(a), Dec. 29, 1979,

93 Stat. 1276.

EFFECTIVE DATE

Section effective Oct. 1, 1979, but not applicable to proceedings

under Title 11, Bankruptcy, commenced before Oct. 1, 1979, see

section 7(e) of Pub. L. 96-589, set out as an Effective Date of

1980 Amendment note under section 108 of this title.

-End-

-CITE-

26 USC [Secs. 6659 to 6661 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART I - GENERAL PROVISIONS

-HEAD-

[Secs. 6659 to 6661. Repealed. Pub. L. 101-239, title VII, Sec.

7721(c)(2), Dec. 19, 1989, 103 Stat. 2399]

-MISC1-

Section 6659, added Pub. L. 97-34, title VII, Sec. 722(a)(1),

Aug. 13, 1981, 95 Stat. 341; amended Pub. L. 97-448, title I, Sec.

107(a)(1), (2), Jan. 12, 1983, 96 Stat. 2391; Pub. L. 98-369, div.

A, title I, Sec. 155(c)(1), title VII, Sec. 721(x)(4), July 18,

1984, 98 Stat. 693, 971, related to additions to tax in case of

valuation overstatements for purposes of the income tax.

A prior section 6659 was renumbered section 6662 of this title.

Section 6659A, added Pub. L. 99-514, title XI, Sec. 1138(a), Oct.

22, 1986, 100 Stat. 2486, related to additions to tax in case of

overstatements of pension liabilities.

Section 6660, added Pub. L. 98-369, div. A, title I, Sec.

155(c)(2)(A), July 18, 1984, 98 Stat. 694; amended Pub. L. 99-514,

title XVIII, Secs. 1811(d), 1899A(57), Oct. 22, 1986, 100 Stat.

2833, 2961, related to additions to tax in case of valuation

understatements for purposes of estate or gift taxes.

A prior section 6660 was renumbered section 6662 of this title.

Section 6661, added Pub. L. 97-248, title III, Sec. 323(a), Sept.

3, 1982, 96 Stat. 613; amended Pub. L. 97-354, Sec. 5(a)(42), Oct.

19, 1982, 96 Stat. 1697; Pub. L. 98-369, div. A, title VII, Sec.

714(h)(3), July 18, 1984, 98 Stat. 962; Pub. L. 99-509, title VIII,

Sec. 8002(a), (c), Oct. 21, 1986, 100 Stat. 1951; Pub. L. 99-514,

title XV, Sec. 1504(a), Oct. 22, 1986, 100 Stat. 2743, related to

substantial understatements of liability.

EFFECTIVE DATE OF REPEAL

Repeal applicable to returns the due date for which (determined

without regard to extensions) is after Dec. 31, 1989, see section

7721(d) of Pub. L. 101-239, set out as an Effective Date of 1989

Amendment note under section 461 of this title.

-End-

-CITE-

26 USC PART II - ACCURACY-RELATED AND FRAUD PENALTIES 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART II - ACCURACY-RELATED AND FRAUD PENALTIES

-HEAD-

PART II - ACCURACY-RELATED AND FRAUD PENALTIES

-MISC1-

Sec.

6662. Imposition of accuracy-related penalty.

6663. Imposition of fraud penalty.

6664. Definitions and special rules.

AMENDMENTS

1989 - Pub. L. 101-239, title VII, Sec. 7721(a), Dec. 19, 1989,

103 Stat. 2395, added part heading and analysis of sections.

-SECREF-

PART REFERRED TO IN OTHER SECTIONS

This part is referred to in sections 5761, 6013, 6034A, 6037,

6222, 6241, 6242, 6601, 6672, 7519 of this title.

-End-

-CITE-

26 USC Sec. 6662 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART II - ACCURACY-RELATED AND FRAUD PENALTIES

-HEAD-

Sec. 6662. Imposition of accuracy-related penalty

-STATUTE-

(a) Imposition of penalty

If this section applies to any portion of an underpayment of tax

required to be shown on a return, there shall be added to the tax

an amount equal to 20 percent of the portion of the underpayment to

which this section applies.

(b) Portion of underpayment to which section applies

This section shall apply to the portion of any underpayment which

is attributable to 1 or more of the following:

(1) Negligence or disregard of rules or regulations.

(2) Any substantial understatement of income tax.

(3) Any substantial valuation misstatement under chapter 1.

(4) Any substantial overstatement of pension liabilities.

(5) Any substantial estate or gift tax valuation

understatement.

This section shall not apply to any portion of an underpayment on

which a penalty is imposed under section 6663.

(c) Negligence

For purposes of this section, the term "negligence" includes any

failure to make a reasonable attempt to comply with the provisions

of this title, and the term "disregard" includes any careless,

reckless, or intentional disregard.

(d) Substantial understatement of income tax

(1) Substantial understatement

(A) In general

For purposes of this section, there is a substantial

understatement of income tax for any taxable year if the amount

of the understatement for the taxable year exceeds the greater

of -

(i) 10 percent of the tax required to be shown on the

return for the taxable year, or

(ii) $5,000.

(B) Special rule for corporations

In the case of a corporation other than an S corporation or a

personal holding company (as defined in section 542), paragraph

(1) shall be applied by substituting "$10,000" for "$5,000".

(2) Understatement

(A) In general

For purposes of paragraph (1), the term "understatement"

means the excess of -

(i) the amount of the tax required to be shown on the

return for the taxable year, over

(ii) the amount of the tax imposed which is shown on the

return, reduced by any rebate (within the meaning of section

6211(b)(2)).

(B) Reduction for understatement due to position of taxpayer or

disclosed item

The amount of the understatement under subparagraph (A) shall

be reduced by that portion of the understatement which is

attributable to -

(i) the tax treatment of any item by the taxpayer if there

is or was substantial authority for such treatment, or

(ii) any item if -

(I) the relevant facts affecting the item's tax treatment

are adequately disclosed in the return or in a statement

attached to the return, and

(II) there is a reasonable basis for the tax treatment of

such item by the taxpayer.

For purposes of clause (ii)(II), in no event shall a

corporation be treated as having a reasonable basis for its tax

treatment of an item attributable to a multiple-party financing

transaction if such treatment does not clearly reflect the

income of the corporation.

(C) Special rules in cases involving tax shelters

(i) In general

In the case of any item of a taxpayer other than a

corporation which is attributable to a tax shelter -

(I) subparagraph (B)(ii) shall not apply, and

(II) subparagraph (B)(i) shall not apply unless (in

addition to meeting the requirements of such subparagraph)

the taxpayer reasonably believed that the tax treatment of

such item by the taxpayer was more likely than not the

proper treatment.

(ii) Subparagraph (B) not to apply to corporations

Subparagraph (B) shall not apply to any item of a

corporation which is attributable to a tax shelter.

(iii) Tax shelter

For purposes of this subparagraph, the term "tax shelter"

means -

(I) a partnership or other entity,

(II) any investment plan or arrangement, or

(III) any other plan or arrangement,

if a significant purpose of such partnership, entity, plan,

or arrangement is the avoidance or evasion of Federal income

tax.

(D) Secretarial list

The Secretary shall prescribe (and revise not less frequently

than annually) a list of positions -

(i) for which the Secretary believes there is not

substantial authority, and

(ii) which affect a significant number of taxpayers.

Such list (and any revision thereof) shall be published in the

Federal Register.

(e) Substantial valuation misstatement under chapter 1

(1) In general

For purposes of this section, there is a substantial valuation

misstatement under chapter 1 if -

(A) the value of any property (or the adjusted basis of any

property) claimed on any return of tax imposed by chapter 1 is

200 percent or more of the amount determined to be the correct

amount of such valuation or adjusted basis (as the case may

be), or

(B)(i) the price for any property or services (or for the use

of property) claimed on any such return in connection with any

transaction between persons described in section 482 is 200

percent or more (or 50 percent or less) of the amount

determined under section 482 to be the correct amount of such

price, or

(ii) the net section 482 transfer price adjustment for the

taxable year exceeds the lesser of $5,000,000 or 10 percent of

the taxpayer's gross receipts.

(2) Limitation

No penalty shall be imposed by reason of subsection (b)(3)

unless the portion of the underpayment for the taxable year

attributable to substantial valuation misstatements under chapter

1 exceeds $5,000 ($10,000 in the case of a corporation other than

an S corporation or a personal holding company (as defined in

section 542)).

(3) Net section 482 transfer price adjustment

For purposes of this subsection -

(A) In general

The term "net section 482 transfer price adjustment" means,

with respect to any taxable year, the net increase in taxable

income for the taxable year (determined without regard to any

amount carried to such taxable year from another taxable year)

resulting from adjustments under section 482 in the price for

any property or services (or for the use of property).

(B) Certain adjustments excluded in determining threshold

For purposes of determining whether the threshold

requirements of paragraph (1)(B)(ii) are met, the following

shall be excluded:

(i) Any portion of the net increase in taxable income

referred to in subparagraph (A) which is attributable to any

redetermination of a price if -

(I) it is established that the taxpayer determined such

price in accordance with a specific pricing method set

forth in the regulations prescribed under section 482 and

that the taxpayer's use of such method was reasonable,

(II) the taxpayer has documentation (which was in

existence as of the time of filing the return) which sets

forth the determination of such price in accordance with

such a method and which establishes that the use of such

method was reasonable, and

(III) the taxpayer provides such documentation to the

Secretary within 30 days of a request for such

documentation.

(ii) Any portion of the net increase in taxable income

referred to in subparagraph (A) which is attributable to a

redetermination of price where such price was not determined

in accordance with such a specific pricing method if -

(I) the taxpayer establishes that none of such pricing

methods was likely to result in a price that would clearly

reflect income, the taxpayer used another pricing method to

determine such price, and such other pricing method was

likely to result in a price that would clearly reflect

income,

(II) the taxpayer has documentation (which was in

existence as of the time of filing the return) which sets

forth the determination of such price in accordance with

such other method and which establishes that the

requirements of subclause (I) were satisfied, and

(III) the taxpayer provides such documentation to the

Secretary within 30 days of request for such documentation.

(iii) Any portion of such net increase which is

attributable to any transaction solely between foreign

corporations unless, in the case of any such corporations,

the treatment of such transaction affects the determination

of income from sources within the United States or taxable

income effectively connected with the conduct of a trade or

business within the United States.

(C) Special rule

If the regular tax (as defined in section 55(c)) imposed by

chapter 1 on the taxpayer is determined by reference to an

amount other than taxable income, such amount shall be treated

as the taxable income of such taxpayer for purposes of this

paragraph.

(D) Coordination with reasonable cause exception

For purposes of section 6664(c) the taxpayer shall not be

treated as having reasonable cause for any portion of an

underpayment attributable to a net section 482 transfer price

adjustment unless such taxpayer meets the requirements of

clause (i), (ii), or (iii) of subparagraph (B) with respect to

such portion.

(f) Substantial overstatement of pension liabilities

(1) In general

For purposes of this section, there is a substantial

overstatement of pension liabilities if the actuarial

determination of the liabilities taken into account for purposes

of computing the deduction under paragraph (1) or (2) of section

404(a) is 200 percent or more of the amount determined to be the

correct amount of such liabilities.

(2) Limitation

No penalty shall be imposed by reason of subsection (b)(4)

unless the portion of the underpayment for the taxable year

attributable to substantial overstatements of pension liabilities

exceeds $1,000.

(g) Substantial estate or gift tax valuation understatement

(1) In general

For purposes of this section, there is a substantial estate or

gift tax valuation understatement if the value of any property

claimed on any return of tax imposed by subtitle B is 50 percent

or less of the amount determined to be the correct amount of such

valuation.

(2) Limitation

No penalty shall be imposed by reason of subsection (b)(5)

unless the portion of the underpayment attributable to

substantial estate or gift tax valuation understatements for the

taxable period (or, in the case of the tax imposed by chapter 11,

with respect to the estate of the decedent) exceeds $5,000.

(h) Increase in penalty in case of gross valuation misstatements

(1) In general

To the extent that a portion of the underpayment to which this

section applies is attributable to one or more gross valuation

misstatements, subsection (a) shall be applied with respect to

such portion by substituting "40 percent" for "20 percent".

(2) Gross valuation misstatements

The term "gross valuation misstatements" means -

(A) any substantial valuation misstatement under chapter 1 as

determined under subsection (e) by substituting -

(i) "400 percent" for "200 percent" each place it appears,

(ii) "25 percent" for "50 percent", and

(iii) in paragraph (1)(B)(ii) -

(I) "$20,000,000" for "$5,000,000", and

(II) "20 percent" for "10 percent".

(B) any substantial overstatement of pension liabilities as

determined under subsection (f) by substituting "400 percent"

for "200 percent", and

(C) any substantial estate or gift tax valuation

understatement as determined under subsection (g) by

substituting "25 percent" for "50 percent".

-SOURCE-

(Added Pub. L. 101-239, title VII, Sec. 7721(a), Dec. 19, 1989, 103

Stat. 2395; amended Pub. L. 101-508, title XI, Sec. 11312(a), (b),

Nov. 5, 1990, 104 Stat. 1388-454, 1388-455; Pub. L. 103-66, title

XIII, Secs. 13236(a)-(d), 13251(a), Aug. 10, 1993, 107 Stat. 505,

506, 531; Pub. L. 103-465, title VII, Sec. 744(a), (b), Dec. 8,

1994, 108 Stat. 5011; Pub. L. 105-34, title X, Sec. 1028(c), Aug.

5, 1997, 111 Stat. 928.)

-MISC1-

PRIOR PROVISIONS

A prior section 6662, acts Aug. 16, 1954, ch. 736, 68A Stat. 827,

Sec. 6659; May 14, 1960, Pub. L. 86-470, Sec. 1, 74 Stat. 132; Dec.

30, 1969, Pub. L. 91-172, title I, Sec. 101(j)(51), 83 Stat. 531;

Sept. 2, 1974, Pub. L. 93-406, title II, Sec. 1016(a)(19), 88 Stat.

931; renumbered Sec. 6660, Aug. 13, 1981, Pub. L. 97-34, title VII,

Sec. 722(a)(1), 95 Stat. 341; renumbered Sec. 6662, Sept. 3, 1982,

Pub. L. 97-248, title III, Sec. 323(a), 96 Stat. 613, directed that

additions be treated as tax and set procedure for assessing certain

additions to tax, prior to repeal by Pub. L. 101-239, title VII,

Sec. 7721(a), Dec. 19, 1989, 103 Stat. 2395, applicable to returns

the due date for which (determined without regard to extensions) is

after Dec. 31, 1989. See section 6665 of this title.

AMENDMENTS

1997 - Subsec. (d)(2)(B). Pub. L. 105-34, Sec. 1028(c)(1),

inserted concluding provisions.

Subsec. (d)(2)(C)(iii). Pub. L. 105-34, Sec. 1028(c)(2),

substituted "a significant purpose" for "the principal purpose" in

concluding provisions.

1994 - Subsec. (d)(2)(C)(i). Pub. L. 103-465, Sec. 744(b)(1),

substituted "In the case of any item of a taxpayer other than a

corporation which is" for "In the case of any item" in introductory

provisions.

Subsec. (d)(2)(C)(ii). Pub. L. 103-465, Sec. 744(a), added cl.

(ii). Former cl. (ii) redesignated (iii).

Subsec. (d)(2)(C)(iii). Pub. L. 103-465, Sec. 744(a), (b)(2),

redesignated cl. (ii) as (iii) and substituted "this subparagraph"

for "clause (i)" in introductory provisions.

1993 - Subsec. (d)(2)(B)(ii). Pub. L. 103-66, Sec. 13251(a),

amended cl. (ii) generally. Prior to amendment, cl. (ii) read as

follows: "any item with respect to which the relevant facts

affecting the item's tax treatment are adequately disclosed in the

return or in a statement attached to the return."

Subsec. (e)(1)(B)(ii). Pub. L. 103-66, Sec. 13236(a), amended cl.

(ii) generally. Prior to amendment, cl. (ii) read as follows: "the

net section 482 transfer price adjustment for the taxable year

exceeds $10,000,000."

Subsec. (e)(3)(B). Pub. L. 103-66, Sec. 13236(b), amended heading

and text of subpar. (B) generally. Prior to amendment, text read as

follows: "For purposes of determining whether the $10,000,000

threshold requirement of paragraph (1)(B)(ii) is met, there shall

be excluded -

"(i) any portion of the net increase in taxable income referred

to in subparagraph (A) which is attributable to any

redetermination of a price if it is shown that there was a

reasonable cause for the taxpayer's determination of such price

and that the taxpayer acted in good faith with respect to such

price, and

"(ii) any portion of such net increase which is attributable to

any transaction solely between foreign corporations unless, in

the case of any of such corporations, the treatment of such

transaction affects the determination of income from sources

within the United States or taxable income effectively connected

with the conduct of a trade or business within the United

States."

Subsec. (e)(3)(D). Pub. L. 103-66, Sec. 13236(c), added subpar.

(D).

Subsec. (h)(2)(A)(iii). Pub. L. 103-66, Sec. 13236(d), amended

cl. (iii) generally. Prior to amendment, cl. (iii) read as follows:

" '$20,000,000' for '$10,000,000',".

1990 - Subsec. (b)(3). Pub. L. 101-508, Sec. 11312(b)(1), amended

par. (3) generally, substituting "misstatement" for

"overstatement".

Subsec. (e). Pub. L. 101-508, Sec. 11312(a), substituted

"misstatement" for "overstatement" in heading and amended text

generally. Prior to amendment, text read as follows:

"(1) In general. - For purposes of this section, there is a

substantial valuation overstatement under chapter 1 if the value of

any property (or the adjusted basis of any property) claimed on any

return of tax imposed by chapter 1 is 200 percent or more of the

amount determined to be the correct amount of such valuation or

adjusted basis (as the case may be).

"(2) Limitation. - No penalty shall be imposed by reason of

subsection (b)(3) unless the portion of the underpayment for the

taxable year attributable to substantial valuation overstatements

under chapter 1 exceeds $5,000 ($10,000 in the case of a

corporation other than an S corporation or a personal holding

company (as defined in section 542))."

Subsec. (h)(2)(A). Pub. L. 101-508, Sec. 11312(b)(2), amended

subpar. (A) generally. Prior to amendment, subpar. (A) read as

follows: "any substantial valuation overstatement under chapter 1

as determined under subsection (e) by substituting '400 percent'

for '200 percent',".

EFFECTIVE DATE OF 1997 AMENDMENT

Amendment by Pub. L. 105-34 applicable to items with respect to

transactions entered into after Aug. 5, 1997, see section

1028(e)(2) of Pub. L. 105-34, set out as a note under section 6111

of this title.

EFFECTIVE DATE OF 1994 AMENDMENT

Section 744(c) of Pub. L. 103-465 provided that: "The amendments

made by this section [amending this section] shall apply to items

related to transactions occurring after the date of the enactment

of this Act [Dec. 8, 1994]."

EFFECTIVE DATE OF 1993 AMENDMENT

Section 13236(e) of Pub. L. 103-66 provided that: "The amendments

made by this section [amending this section] shall apply to taxable

years beginning after December 31, 1993."

Section 13251(b) of Pub. L. 103-66 provided that: "The amendment

made by this section [amending this section] shall apply to returns

the due dates for which (determined without regard to extensions)

are after December 31, 1993."

EFFECTIVE DATE OF 1990 AMENDMENT

Section 11312(c) of Pub. L. 101-508 provided that: "The

amendments made by this section [amending this section] shall apply

to taxable years ending after the date of the enactment of this Act

[Nov. 5, 1990]."

EFFECTIVE DATE

Part applicable to returns the due date for which (determined

without regard to extensions) is after Dec. 31, 1989, see section

7721(d) of Pub. L. 101-239, set out as an Effective Date of 1989

Amendment note under section 461 of this title.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 461, 1274, 6015, 6694,

7525 of this title.

-End-

-CITE-

26 USC Sec. 6663 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART II - ACCURACY-RELATED AND FRAUD PENALTIES

-HEAD-

Sec. 6663. Imposition of fraud penalty

-STATUTE-

(a) Imposition of penalty

If any part of any underpayment of tax required to be shown on a

return is due to fraud, there shall be added to the tax an amount

equal to 75 percent of the portion of the underpayment which is

attributable to fraud.

(b) Determination of portion attributable to fraud

If the Secretary establishes that any portion of an underpayment

is attributable to fraud, the entire underpayment shall be treated

as attributable to fraud, except with respect to any portion of the

underpayment which the taxpayer establishes (by a preponderance of

the evidence) is not attributable to fraud.

(c) Special rule for joint returns

In the case of a joint return, this section shall not apply with

respect to a spouse unless some part of the underpayment is due to

the fraud of such spouse.

-SOURCE-

(Added Pub. L. 101-239, title VII, Sec. 7721(a), Dec. 19, 1989, 103

Stat. 2397.)

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in section 6662 of this title.

-End-

-CITE-

26 USC Sec. 6664 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART II - ACCURACY-RELATED AND FRAUD PENALTIES

-HEAD-

Sec. 6664. Definitions and special rules

-STATUTE-

(a) Underpayment

For purposes of this part, the term "underpayment" means the

amount by which any tax imposed by this title exceeds the excess of

-

(1) the sum of -

(A) the amount shown as the tax by the taxpayer on his

return, plus

(B) amounts not so shown previously assessed (or collected

without assessment), over

(2) the amount of rebates made.

For purposes of paragraph (2), the term "rebate" means so much of

an abatement, credit, refund, or other repayment, as was made on

the ground that the tax imposed was less than the excess of the

amount specified in paragraph (1) over the rebates previously made.

(b) Penalties applicable only where return filed

The penalties provided in this part shall apply only in cases

where a return of tax is filed (other than a return prepared by the

Secretary under the authority of section 6020(b)).

(c) Reasonable cause exception

(1) In general

No penalty shall be imposed under this part with respect to any

portion of an underpayment if it is shown that there was a

reasonable cause for such portion and that the taxpayer acted in

good faith with respect to such portion.

(2) Special rule for certain valuation overstatements

In the case of any underpayment attributable to a substantial

or gross valuation overstatement under chapter 1 with respect to

charitable deduction property, paragraph (1) shall not apply

unless -

(A) the claimed value of the property was based on a

qualified appraisal made by a qualified appraiser, and

(B) in addition to obtaining such appraisal, the taxpayer

made a good faith investigation of the value of the contributed

property.

(3) Definitions

For purposes of this subsection -

(A) Charitable deduction property

The term "charitable deduction property" means any property

contributed by the taxpayer in a contribution for which a

deduction was claimed under section 170. For purposes of

paragraph (2), such term shall not include any securities for

which (as of the date of the contribution) market quotations

are readily available on an established securities market.

(B) Qualified appraiser

The term "qualified appraiser" means any appraiser meeting

the requirements of the regulations prescribed under section

170(a)(1).

(C) Qualified appraisal

The term "qualified appraisal" means any appraisal meeting

the requirements of the regulations prescribed under section

170(a)(1).

-SOURCE-

(Added Pub. L. 101-239, title VII, Sec. 7721(a), Dec. 19, 1989, 103

Stat. 2398.)

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in section 6662 of this title.

-End-

-CITE-

26 USC PART III - APPLICABLE RULES 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART III - APPLICABLE RULES

-HEAD-

PART III - APPLICABLE RULES

-MISC1-

Sec.

6665. Applicable rules.

AMENDMENTS

1989 - Pub. L. 101-239, title VII, Sec. 7721(a), Dec. 19, 1989,

103 Stat. 2398, added part heading and analysis.

-End-

-CITE-

26 USC Sec. 6665 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter A - Additions to the Tax and Additional Amounts

PART III - APPLICABLE RULES

-HEAD-

Sec. 6665. Applicable rules

-STATUTE-

(a) Additions treated as tax

Except as otherwise provided in this title -

(1) the additions to the tax, additional amounts, and penalties

provided by this chapter shall be paid upon notice and demand and

shall be assessed, collected, and paid in the same manner as

taxes; and

(2) any reference in this title to "tax" imposed by this title

shall be deemed also to refer to the additions to the tax,

additional amounts, and penalties provided by this chapter.

(b) Procedure for assessing certain additions to tax

For purposes of subchapter B of chapter 63 (relating to

deficiency procedures for income, estate, gift, and certain excise

taxes), subsection (a) shall not apply to any addition to tax under

section 6651, 6654, or 6655; except that it shall apply -

(1) in the case of an addition described in section 6651, to

that portion of such addition which is attributable to a

deficiency in tax described in section 6211; or

(2) to an addition described in section 6654 or 6655, if no

return is filed for the taxable year.

-SOURCE-

(Added Pub. L. 101-239, title VII, Sec. 7721(a), Dec. 19, 1989, 103

Stat. 2399.)

-MISC1-

EFFECTIVE DATE

Section applicable to returns the due date for which (determined

without regard to extensions) is after Dec. 31, 1989, see section

7721(d) of Pub. L. 101-239, set out as an Effective Date of 1989

Amendment note under section 461 of this title.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 5134, 5684, 5761 of this

title.

-End-

-CITE-

26 USC Subchapter B - Assessable Penalties 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter B - Assessable Penalties

-HEAD-

SUBCHAPTER B - ASSESSABLE PENALTIES

-MISC1-

Part

I. General provisions.

II. Failure to comply with certain information reporting

requirements.

AMENDMENTS

1989 - Pub. L. 101-239, title VII, Sec. 7711(b)(5), Dec. 19,

1989, 103 Stat. 2393, substituted "Failure to comply with certain

information reporting requirements" for "Failure to file certain

information returns or statements" in item for part II.

-End-

-CITE-

26 USC PART I - GENERAL PROVISIONS 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter B - Assessable Penalties

PART I - GENERAL PROVISIONS

-HEAD-

PART I - GENERAL PROVISIONS

-MISC1-

Sec.

6671. Rules for application of assessable penalties.

6672. Failure to collect and pay over tax, or attempt to

evade or defeat tax.

6673. Sanctions and costs awarded by courts.

6674. Fraudulent statement or failure to furnish statement

to employee.

6675. Excessive claims with respect to the use of certain

fuels.

[6676. Repealed.]

6677. Failure to file information with respect to certain

foreign trusts.

[6678. Repealed.]

6679. Failure to file returns, etc., with respect to foreign

corporations or foreign partnerships.

[6680, 6681. Repealed.]

6682. False information with respect to withholding.

6683. Failure of foreign corporation to file return of

personal holding company tax.

6684. Repeated liability for tax under chapter 42.(!1)

6685. Assessable penalty with respect to public inspection

requirements for certain tax-exempt organizations.

6686. Failure to file returns or supply information by DISC

or FSC.

[6687. Repealed.]

6688. Assessable penalties with respect to information

required to be furnished under section 7654.

6689. Failure to file notice of redetermination of foreign

tax.

6690. Fraudulent statement or failure to furnish statement

to plan participant.

[6691. Reserved.]

6692. Failure to file actuarial report.

6693. Failure to provide reports on certain tax-favored

accounts or annuities; penalties relating to

designated nondeductible contributions.

6694. Understatement of taxpayer's liability by income tax

return preparer.

6695. Other assessable penalties with respect to the

preparation of income tax returns for other persons.

6696. Rules applicable with respect to sections 6694 and

6695.

6697. Assessable penalties with respect to liability for tax

of regulated investment companies.

6698. Failure to file partnership return.

[6698A, 6699. Repealed.]

6700. Promoting abusive tax shelters, etc.

6701. Penalties for aiding and abetting understatement of

tax liability.

6702. Frivolous income tax return.

6703. Rules applicable to penalties under sections 6700,

6701, and 6702.

6704. Failure to keep records necessary to meet reporting

requirements under section 6047(d).

6705. Failure by broker to provide notice to payors.

6706. Original issue discount information requirements.

6707. Failure to furnish information regarding tax shelters.

6708. Failure to maintain lists of investors in potentially

abusive tax shelters.

6709. Penalties with respect to mortgage credit

certificates.

6710. Failure to disclose that contributions are

nondeductible.

6711. Failure by tax-exempt organization to disclose that

certain information or service available from Federal

Government.

6712. Failure to disclose treaty-based return positions.

6713. Disclosure or use of information by preparers of

returns.

6714. Failure to meet disclosure requirements applicable to

quid pro quo contributions.

6715. Dyed fuel sold for use or used in taxable use, etc.

6716. Failure to file information with respect to certain

transfers at death and gifts.

AMENDMENTS

2001 - Pub. L. 107-16, title V, Sec. 542(b)(5)(A), June 7, 2001,

115 Stat. 83, added item 6716.

1997 - Pub. L. 105-34, title II, Sec. 211(e)(2)(D), Aug. 5, 1997,

111 Stat. 812, substituted "certain tax-favored" for "individual

retirement" in item 6693.

1996 - Pub. L. 104-188, title I, Secs. 1703(n)(9)(B), 1901(c)(3),

Aug. 20, 1996, 110 Stat. 1877, 1908, substituted "information" for

"information returns" in item 6677 and redesignated item 6714,

relating to dyed fuel sold for use or used in taxable use, etc., as

item 6715.

1993 - Pub. L. 103-66, title XIII, Sec. 13242(b)(2), Aug. 10,

1993, 107 Stat. 521, added item 6714 "Dyed fuel sold for use or

used in taxable use, etc.".

Pub. L. 103-66, title XIII, Sec. 13173(c)(2), Aug. 10, 1993, 107

Stat. 457, added item 6714 "Failure to meet disclosure requirements

applicable to quid pro quo contributions".

1989 - Pub. L. 101-239, title VII, Secs. 7711(b)(4), 7731(c),

7816(v)(2), Dec. 19, 1989, 103 Stat. 2393, 2401, 2423, substituted

"Sanctions and costs awarded by courts" for "Damages assessable for

instituting proceedings before the Tax Court primarily for delay,

etc." in item 6673, struck out items 6676 "Failure to supply

identifying numbers" and 6687 "Failure to supply information with

respect to place of residence", and redesignated item 6712

"Disclosure or use of information by preparers of returns" as 6713.

1988 - Pub. L. 100-647, title I, Sec. 1011(b)(4)(B)(ii), Nov. 10,

1988, 102 Stat. 3457, substituted "penalties relating to" for

"overstatement of" in item 6693.

Pub. L. 100-647, title VI, Sec. 6242(c), Nov. 10, 1988, 102 Stat.

3749, added item 6712 "Disclosure or use of information by

preparers of returns".

Pub. L. 100-647, title I, Sec. 1012(aa)(5)(C)(ii), Nov. 10, 1988,

102 Stat. 3533, added item 6712 "Failure to disclose treaty-based

return positions".

1987 - Pub. L. 100-203, title X, Secs. 10701(c)(2), 10704(b)(2),

10705(b), Dec. 22, 1987, 101 Stat. 1330-459, 1330-463, 1330-464,

substituted "Assessable penalty with respect to public inspection

requirements for certain tax-exempt organizations" for "Assessable

penalties with respect to private foundation annual returns" in

item 6685 and added items 6710 and 6711.

1986 - Pub. L. 99-514, title VI, Sec. 667(b)(2), title XI, Secs.

1102(d)(2)(C), 1171(b)(7)(B), title XV, Sec. 1501(d)(3), (4), title

XVIII, Secs. 1848(e)(3), 1862(d)(3), Oct. 22, 1986, 100 Stat. 2306,

2416, 2513, 2740, 2858, 2884, inserted analysis of parts comprising

subchapter B, inserted heading for Part I, struck out item 6678

"Failure to furnish certain statements", inserted "; overstatement

of designated nondeductible contributions" in item 6693,

substituted "regulated investment companies" for "qualified

investment entities" in item 6697, struck out item 6699 "Assessable

penalties relating to tax credit employee stock ownership plan",

substituted "section 6047(d)" for "section 6047(e)" in item 6704,

and redesignated item 6708, relating to penalties with respect to

mortgage credit certificates, as 6709.

1984 - Pub. L. 98-369, div. A, title I, Secs. 41(c)(2),

141(c)(2), title VIII, Sec. 801(d)(15)(B), July 18, 1984, 98 Stat.

556, 680, 997, added items 6686, 6706, and 6707.

Pub. L. 98-369, div. A, title VI, Sec. 612(d)(2), July 18, 1984,

98 Stat. 912, added item 6708 "Penalties with respect to mortgage

credit certificates".

Pub. L. 98-369, div. A, title I, Sec. 142(c)(2), July 18, 1984,

98 Stat. 682, added item 6708 "Failure to maintain lists of

investors in potentially abusive tax shelters".

1983 - Pub. L. 98-67, title I, Sec. 104(c)(2), Aug. 5, 1983, 97

Stat. 379, added item 6705.

Pub. L. 97-424, title V, Sec. 515(b)(11)(D), Jan. 6, 1983, 96

Stat. 2182, struck out "or lubricating oil" after "certain fuels"

in item 6675.

1982 - Pub. L. 97-248, title II, Sec. 292(d)(2)(B), title III,

Secs. 320(b), 322(b), 324(b), 326(b), 334(c)(2), 340(b)(3), title

IV, Sec. 405(c)(3), Sept. 3, 1982, 96 Stat. 574, 612, 613, 616,

617, 627, 634, 670, as amended by Pub. L. 97-448, title III, Sec.

306(c)(2)(B), Jan. 12, 1983, 96 Stat. 2406, substituted "primarily

for delay, etc." for "merely for delay." in item 6673, substituted

"returns, etc., with respect to foreign corporations or foreign

partnerships" for "returns as to organization or reorganization of

foreign corporations and as to acquisitions of their stock" in item

6679, and added items 6700 to 6704.

1981 - Pub. L. 97-34, title VII, Sec. 721(c), Aug. 13, 1981, 95

Stat. 341, struck out "allowances based on itemized deductions"

after "withholding" in item 6682.

1980 - Pub. L. 96-603, Secs. 1(e)(3), 2(d)(2), Dec. 28, 1980, 94

Stat. 3505, 3510, substituted "returns" for "reports" in item 6685

and added item 6689.

Pub. L. 96-223, title IV, Sec. 401(a), Apr. 2, 1980, 94 Stat.

299, repealed Pub. L. 94-455, Sec. 2005(e)(4), and Pub. L. 95-600,

Sec. 702(r)(1)(C), and the amendments made thereby, which resulted

in striking out item 6698A "Failure to file information with

respect to carryover basis property", which had been added as item

6694 in 1976 and redesignated as item 6698 in 1978. Pub. L. 96-222,

Secs. 107(a)(2)(E), 201, redesignated item 6698 as 6698A, effective

as if included in Pub. L. 95-600.

Pub. L. 96-222, title I, Secs. 101(a)(7)(L)(v)(X), 107(a)(2)(E),

Apr. 1, 1980, 94 Stat. 201, 223, redesignated item 6698, relating

to failure to file information with respect to carry-over basis

property, as 6698A and substituted "tax credit employee stock

ownership plan" for "ESOP" in item 6699.

1978 - Pub. L. 95-600, title VII, Sec. 701(r)(1)(C), Nov. 6,

1978, 92 Stat. 2938, which redesignated item 6694 "Failure to file

information with respect to carryover basis property" as item 6698,

was repealed by Pub. L. 96-223, Sec. 401(a). See section 401(b),

(e) of Pub. L. 96-223, set out as an Effective Date of 1980

Amendments and Revival of Prior Law note under section 1023 of this

title.

Pub. L. 95-600, title I, Sec. 141(c)(2), title II, Sec. 211(b),

title III, Sec. 362(d)(9), Nov. 6, 1978, 92 Stat. 2794, 2818, 2852,

substituted "qualified investment entities" for "real estate

investment trusts" in item 6697, and added item 6698 "Failure to

file partnership return" and item 6699 "Assessable penalties

relating to ESOP".

1976 - Pub. L. 94-455, title XX, Sec. 2005(e)(4), Oct. 4, 1976,

90 Stat. 1878, which added item 6694 "Failure to file information

with respect to carryover basis property", was repealed by Pub. L.

96-223, Sec. 401(a). See section 401(b), (e) of Pub. L. 96-223, set

out as an Effective Date of 1980 Amendments and Revival of Prior

Law note under section 1023 of this title.

Pub. L. 94-455, title XII, Sec. 1203(i)(3), title XVI, Sec.

1601(b)(2), title XIX, Sec. 1904(b)(10)(A)(vi)(II), (D)(ii),

(E)(ii), Oct. 4, 1976, 90 Stat. 1694, 1746, 1817, struck out item

6680 "Failure to file interest equalization tax returns", item 6681

"False equalization tax certificates" and item 6689 "Failure by

certain foreign issuers and obligors to comply with United States

investment equalization tax requirements" and added item 6694

"Understatement of taxpayer's liability by income tax return

preparer" and items 6695 to 6697.

1974 - Pub. L. 93-406, title II, Secs. 1016(b)(3), 1031(b)(2)(B),

1033(d), 2002(h)(4), Sept. 2, 1974, 88 Stat. 932, 946, 948, 971,

substituted "6688" for "6687" as section number in item relating to

assessable penalties with respect to information required to be

furnished under section 7654, and added items 6690, 6692, and 6693.

1973 - Pub. L. 93-17, Sec. 3(d)(3)(B), Apr. 10, 1973, 87 Stat.

17, added item 6689.

1972 - Pub. L. 92-606, Sec. 1(f)(7), Oct. 31, 1972, 86 Stat.

1497, added item 6687 relating to assessable penalties with respect

to information required to be furnished under section 7654.

Pub. L. 92-512, title I, Sec. 144(b)(2), Oct. 20, 1972, 86 Stat.

936, added item 6687 relating to failure to supply information with

respect to place of residence.

1970 - Pub. L. 91-258, title II, Sec. 207(d)(13), May 21, 1970,

84 Stat. 249, substituted "fuels" for "gasoline" in item 6675.

1969 - Pub. L. 91-172, title I, Sec. 101(j)(60), Dec. 30, 1969,

83 Stat. 532, added items 6684 and 6685.

1966 - Pub. L. 89-809, title I, Sec. 104(h)(4)(B), Nov. 13, 1966,

80 Stat. 1560, added item 6683.

Pub. L. 89-368, title I, Sec. 101(e)(4)(B), Mar. 15, 1966, 80

Stat. 62, added item 6682.

1965 - Pub. L. 89-44, title II, Sec. 202(c)(3)(B), June 21, 1965,

79 Stat. 139, inserted "or lubricating oil" after "certain

gasoline" in item 6675.

1964 - Pub. L. 88-563, Sec. 6(c)(1), Sept. 2, 1964, 78 Stat. 847,

added items 6680 and 6681.

1962 - Pub. L. 87-834, Secs. 7(i)(3), 19(g)(2), 20(d)(3), Oct.

16, 1962, 76 Stat. 989, 1058, 1063, added items 6677 to 6679.

1961 - Pub. L. 87-397, Sec. 1(c)(2), Oct. 5, 1961, 75 Stat. 829,

added item 6676.

1956 - Act June 29, 1956, ch. 462, title II, Sec. 208(e)(8), 70

Stat. 397, substituted "Excessive claims with respect to the use of

certain gasoline" for "Excessive claims for gasoline used on farms"

in item 6675.

Act Apr. 2, 1956, ch. 160, Sec. 4(g), 70 Stat. 91, added item

6675.

-SECREF-

SUBCHAPTER REFERRED TO IN OTHER SECTIONS

This subchapter is referred to in section 6166 of this title.

-FOOTNOTE-

(!1) So in original. Does not conform to section catchline.

-End-

-CITE-

26 USC Sec. 6671 01/06/03

-EXPCITE-

TITLE 26 - INTERNAL REVENUE CODE

Subtitle F - Procedure and Administration

CHAPTER 68 - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND

ASSESSABLE PENALTIES

Subchapter B - Assessable Penalties

PART I - GENERAL PROVISIONS

-HEAD-

Sec. 6671. Rules for application of assessable penalties

-STATUTE-

(a) Penalty assessed as tax

The penalties and liabilities provided by this subchapter shall

be paid upon notice and demand by the Secretary, and shall be

assessed and collected in the same manner as taxes. Except as

otherwise provided, any reference in this title to "tax" imposed by

this title shall be deemed also to refer to the penalties and

liabilities provided by this subchapter.

(b) Person defined

The term "person", as used in this subchapter, includes an

officer or employee of a corporation, or a member or employee of a

partnership, who as such officer, employee, or member is under a

duty to perform the act in respect of which the violation occurs.

-SOURCE-

(Aug. 16, 1954, ch. 736, 68A Stat. 828; Pub. L. 94-455, title XIX,

Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834.)

-MISC1-

AMENDMENTS

1976 - Pub. L. 94-455 struck out "or his delegate" after

"Secretary".

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 999, 6653 of this title.

-End-