Title 26 — Internal Revenue CodeRelease 119-73
§6699 Failure to file S corporation return
Title 26 › Subtitle Subtitle F— - Procedure and Administration › Chapter CHAPTER 68— - ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND ASSESSABLE PENALTIES › Subchapter Subchapter B— - Assessable Penalties › Part PART I— - GENERAL PROVISIONS › § 6699
Summary
If an S corporation that must file an S-corp return doesn't file on time or leaves out the required shareholder information, it must pay a monthly penalty. The monthly amount is $195 multiplied by the number of people who were shareholders at any time during the year. The penalty is charged to the S corporation, and the usual tax-deficiency procedures do not apply. For returns required in a calendar year beginning after 2014, the $195 is increased for inflation using the cost-of-living rule in section 1(f)(3) but with calendar year 2013 used in the formula instead of 2016, and any adjusted amount not a multiple of $5 is rounded down to the nearest $5.
Full Legal Text
Title 26, §6699
Internal Revenue Code — Source: USLM XML via OLRC
(a)In addition to the penalty imposed by section 7203 (relating to willful failure to file return, supply information, or pay tax), if any S corporation required to file a return under section 6037 for any taxable year—
(1)fails to file such return at the time prescribed therefor (determined with regard to any extension of time for filing), or
(2)files a return which fails to show the information required under section 6037,
(b)For purposes of subsection (a), the amount determined under this subsection for any month is the product of—
(1)$195, multiplied by
(2)the number of persons who were shareholders in the S corporation during any part of the taxable year.
(c)The penalty imposed by subsection (a) shall be assessed against the S corporation.
(d)Subchapter B of chapter 63 (relating to deficiency procedures for income, estate, gift, and certain excise taxes) shall not apply in respect of the assessment or collection of any penalty imposed by subsection (a).
(e)(1)In the case of any return required to be filed in a calendar year beginning after 2014, the $195 dollar amount under subsection (b)(1) shall be increased by an amount equal to such dollar amount multiplied by the cost-of-living adjustment determined under section 1(f)(3) for the calendar year determined by substituting “calendar year 2013” for “calendar year 2016” in subparagraph (A)(ii) thereof.
(2)If any amount adjusted under paragraph (1) is not a multiple of $5, such amount shall be rounded to the next lowest multiple of $5.
Legislative History
Notes & Related Subsidiaries
Inflation Adjusted Items for Certain YearsFor inflation adjustment of certain items in this section, see Revenue Procedures listed in a table under section 1 of this title.
Editorial Notes
Codification section 9(a) of Pub. L. 110–142, which directed amendment of this part by adding this section at the end, was executed by inserting this section after section 6698, to reflect the probable intent of Congress.
Prior Provisions
A prior section 6699, added Pub. L. 95–600, title I, § 141(c)(1), Nov. 6, 1978, 92 Stat. 2794; amended Pub. L. 96–222, title I, § 101(a)(7)(L)(iii)(VI), (v)(IX), Apr. 1, 1980, 94 Stat. 200; Pub. L. 97–34, title III, § 331(c)(3), (4), Aug. 13, 1981, 95 Stat. 293, 294; Pub. L. 97–448, title I, § 103(g)(2)(B)–(D), Jan. 12, 1983, 96 Stat. 2379; Pub. L. 98–369, div. A, title IV, § 491(e)(9), July 18, 1984, 98 Stat. 853; Pub. L. 99–514, title XVIII, § 1847(b)(9), Oct. 22, 1986, 100 Stat. 2857, related to assessable penalties applicable to tax credit employee stock ownership plans, prior to repeal by Pub. L. 99–514, title XI, § 1171(b)(7)(A), Oct. 22, 1986, 100 Stat. 2513. For
Effective Date
of repeal, see section 1171(c) of Pub. L. 99–514, set out as an
Effective Date
of 1986 Amendment note under section 38 of this title.
Amendments
2018—Subsec. (e)(1). Pub. L. 115–141 inserted “an amount equal to” after “increased by” and “for the calendar year” after “section 1(f)(3)”. 2017—Subsec. (e)(1). Pub. L. 115–97 substituted “for ‘calendar year 2016’ in subparagraph (A)(ii)” for “for ‘calendar year 1992’ in subparagraph (B)”. 2014—Subsec. (e). Pub. L. 113–295 added subsec. (e). 2009—Subsec. (b)(1). Pub. L. 111–92 substituted “$195” for “$89”. 2008—Subsec. (b)(1). Pub. L. 110–458 substituted “$89” for “$85”.
Statutory Notes and Related Subsidiaries
Effective Date
of 2017 AmendmentAmendment by Pub. L. 115–97 applicable to taxable years beginning after Dec. 31, 2017, see section 11002(e) of Pub. L. 115–97, set out as a note under section 1 of this title.
Effective Date
of 2014 AmendmentAmendment by Pub. L. 113–295 applicable to returns required to be filed, and statements required to be furnished, after Dec. 31, 2014, see section 208(h) of Pub. L. 113–295, set out as a note under section 6651 of this title.
Effective Date
of 2009 AmendmentAmendment by Pub. L. 111–92 applicable to returns for taxable years beginning after Dec. 31, 2009, see section 16(b) of Pub. L. 111–92, set out as a note under section 6698 of this title.
Effective Date
of 2008 Amendment Pub. L. 110–458, title I, § 128(b), Dec. 23, 2008, 122 Stat. 5116, provided that: “The amendment made by subsection (a) [amending this section] shall apply to returns required to be filed after December 31, 2008.”
Effective Date
Pub. L. 110–142, § 9(c), Dec. 20, 2007, 121 Stat. 1808, provided that: “The
Amendments
made by this section [enacting this section] shall apply to returns required to be filed after the date of the enactment of this Act [Dec. 20, 2007].”
Reference
Citations & Metadata
Citation
26 U.S.C. § 6699
Title 26 — Internal Revenue Code
Last Updated
Apr 6, 2026
Release point: 119-73