IRS Issues Penalty Notice 972CG to the Employers for Late ACA Reporting

IRS issues notice 972CG, a penalty assessment Notice to step up its ACA enforcement activities for not complying with the IRS mandate ACA reporting requirements.

The Notice is for the late filing of 1094/1095 Forms for Tax Year 2017. Employers might also receive this penalty notice for unresolved TIN validation errors, and not filing the ACA returns electronically when required.

Have you received the IRS Notice 972CG?

Contact ACAwise at (704)-954-8420 or email your concern with the Notice you received to support@acawise.com. We provide a free assessment of what can be done and provide you with the instructions to proceed further.

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Penalty Notice 972CG Explained!

The employer who has filed the ACA Forms 1094/1095 late, or filed on incorrect media, or filed with incorrect TIN/Name will receive the Penalty Notice 972CG under IRC Section 6721.

What does this Notice contains?

The content of Notice 972CG includes:

  • The explanation for the proposed penalty and how to respond to the notice.
  • The notice will include each submission considered in the total penalty, the form type, date received (if not filed on time), whether the returns were original or corrected, the transmitter control code (for electronic filers), and the type of penalty that applies such as late, incorrect TINs, etc.
  • A list of ACA returns filed with missing or incorrect name/TIN combinations.
  • A record of every submission considered in the total penalty.
  • Summary of the proposed penalty assessed under IRS Section 6721.
  • The notice will have a response page and payment/correspondence slip.

How to Respond to the Notice 972CG?

Employers who received Notice 972CG from the IRS must respond within 45 calendar days from the notice date. Foreign filers can file within 60 days. If you need more time, submit a written request to the address listed on the notice. The request must be sent before the end of the 45 or 60 day period.

Employers must Send in the portion of the payment or correspondence slip (response) which is appropriate to them. And employers must sign and submit the payment if they fully or partially agree to the proposed penalty.

The employer must submit a written statement if seeking a waiver of the proposed penalty. The statement should state the specific provision under which the waiver is being requested.

  • The facts claimed as the basis for reasonable cause and that the filer acted in a responsible manner for each missing/incorrect TIN took place in the time and manner required by regulations.

The written statement must contain the signature of the person required to file the return, and the declaration made under penalties of perjury.

To get the additional explanation or information, the IRS may issue Letter 1948C to support the request to waive the proposed penalty. The IRS will reject the waiver request if the employer doesn’t respond by the time indicated in the Notice.

If the given explanation was accepted the IRS will issue Letter 1948C as a note of acceptance and the applicable penalty will not be charged.

A penalty will be charged if the written statement does not have a reasonable cause. The IRS will send Letter 854C explaining the reason for the denial, including the filer’s appeal rights. The IRS will charge the full amount of the penalty if there is no response to the Notice 972CG within 45 days. Also, a balance due notice (CP15 or CP215) including the appeal rights being issued.

What about Penalty Rates for not complying
with the IRS?

Under IRC 6721(a) and IRC 6722(a), IRS determines the penalty from $50 to $100 for each return for late filing and it raises to $260 per form for those filed after August 1st.

The Notice 972CG also indicates penalties of $260 per form for not filing of 1095 Forms electronically when required, and for TIN validation errors.

If you need any additional information about penalties Notice 972CG, see Publication 1586.

Feeling Overwhelmed? Never get stressed about Notice 972CG?

Contact ACAwise Now! We have a team of experts who are ready to assist you regarding the questions that you might have with Notice 972CG.

And ACAwise provides you the free assessment solution and helps you to respond back to the penalty notice.

A solution to Error Free ACA Filing

As the leader in ACA Reporting, ACAwise prevents you from paying unnecessary IRS penalties. Partner with ACAwise for your ACA reporting and report your Forms error-free. ACAwise will validate your TIN against the IRS database & help you correct the mismatched TINs. By the way, ACAwise can ensure that you won’t receive the Notice 972CG.

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Notice 972CG?
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