The IRS waived penalties under Internal Revenue Code Section 6654 for the owners of pass-through businesses who may have underpaid estimated income tax installments that were due by July 15, 2020, because of the temporary suspension of the rules, the IRS said in a notice.
The guidance laid out requirements for qualifying for the waiver, including that the individual seeking the relief timely filed federal income tax returns for 2018 and 2019 and had made a request using procedures laid out in the notice.
The Coronavirus Aid, Relief and Economic Security Act of 2020 temporarily suspended IRC Section 461(l) , which ordinarily limits how much partnerships, S corporations and pass-throughs can claim in losses against nonbusiness income in a given year. The coronavirus rescue package temporarily suspended the provision in an attempt to help businesses access cash amid the economic fallout of the novel coronavirus pandemic.
--Additional reporting by Alex M. Parker. Editing by Vincent Sherry.
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