Medical Emergency Care Associates, S.C., An Illinois Corporation - Page 14

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          of the reclassified physicians.  The tax liability of each of the           
          reclassified physicians would likewise be affected.                         
               We repeat that respondent correctly states that timely                 
          filing of returns is required throughout the Internal Revenue               
          Code.  This includes Forms 1096 and 1099.  The consequences of              
          “Failure to Comply with Certain Information Reporting                       
          Requirements” are contained in sections 6721 through 6724.                  
          Section 6721(a) deals with “Failure to file correct information             
          returns”, which includes Forms 1096 and 1099 (see section 6041A),           
          and section 6721(a)(2)(A) describes a failure to file subject to            
          penalty as “any failure to file an information return with the              
          Secretary on or before the required filing date.”  Section                  
          6721(e) prescribes a “Penalty in case of intentional disregard”.            
          Section 6722 provides for similar penalties in the case of                  
          “Failure to furnish correct payee statements”; section 6723                 
          prescribes a penalty for “Failure to comply with other                      
          information reporting requirements”, and section 6724 contains,             
          among other things, a reasonable cause waiver.                              
               Nothing in the language or legislative history of section              
          530 leads us to the conclusion that denial of section 530 relief            
          was meant to be an additional penalty for the failure to timely             
          file information returns, particularly under the circumstances in           
          this case.  Rather, as discussed above, section 530 was enacted             
          to protect taxpayers from having to litigate the status of                  

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Last modified: May 25, 2011