TC – E-Assessment Do Not Need Supervisor Approval

According to Law360, in the case Piper Trucking & Leasing LLC v. Commissioner, docket number 20468-21L, the U.S. Tax Court ruled that digitally calculated penalties imposed on employers who fail to file certain tax forms do not require supervisory approval.

The Internal Revenue Service may proceed with its plan to collect penalties assessed to Piper Trucking & Leasing by the agency's combined annual wage reporting program after the company failed to file Forms W-2 and W-3 with the Social Security Administration.

The SSA twice attempted to reach out to the company to remedy the issue, the opinion said, but after the Ohio-based company failed to respond, the SSA referred the matter to the IRS. Using the software, the agency then assessed Piper a penalty under Internal Revenue Code Section 6721(e), an assessment Piper argued was invalid.

Under Section 6751 of the IRC, no penalties shall be assessed unless the initial determination is approved by the immediate supervisor of the person making the decision. 

However, the Same Section Provides that
Penalties Calculated Without Human Interaction
are not Subject to the Approval Requirement

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Read more at: Tax Times blog