§ 6677. Failure to file information with respect to certain foreign trusts

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 1962

   Revenue Act of 1962

   Pub. L. 87–834 § 7(g) · 76 Stat. 960

   Enacted · 26 U.S.C. § 6677

   Added Pub. L. 87–834, § 7(g), Oct. 16, 1962, 76 Stat. 988

   Source evidence

   Code source credit
   Added Pub. L. 87–834, § 7(g), Oct. 16, 1962, 76 Stat. 988

   Enacted provision · exact public law section
   (g) Failure To File Information Returns.— Subchapter B of 26 USC 6651–6659. chapter 68 (relating to assessable penalties) is amended by adding at the end thereof the following new section: “SEC. 6677. FAILURE TO FILE INFORMATION RETURNS WITH RESPECT TO CERTAIN FOREIGN TRUSTS. “(a) Civil Penalty.— In addition to any criminal penalty provided by law, any person required to file a return under section 6048 who fails to file such return at the time provided in such section, or who files a return which does not show the information required pursuant to such section, shall pay a penalty equal to 5 percent of the amount transferred to a trust, but not more than $1,000, unless it is shown 1 hat such failure is due to reasonable cause. “(b) Deficiency Procedures Not To Apply.— Subchapter B of 26 USC 6211–6216. chapter 63 (relating to deficiency procedures for income, estate, and gift taxes) shall not apply in respect of the assessment or collection of any penalty imposed by subsection (a).”

2. 1969

   Tax Reform Act of 1969

   Pub. L. 91–172 title I § 101(j)(53) · 83 Stat. 487

   Inserted · 26 U.S.C. § 6677(b)

   Pub. L. 91–172 inserted reference to chapter 42 taxes

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 91–172 inserted reference to chapter 42 taxes.

   Enacted provision · exact public law section
   (53) Section 6677(b) (relating to deficiency procedures not to 76 Stat. 988. apply) is amended by striking out “and gift taxes” and inserting in lieu thereof “gift, and chapter 42 taxes”.

3. 1974

   Employee Retirement Income Security Act of 1974

   Pub. L. 93–406 title II § 1016(a)(21) · 88 Stat. 829

   Substituted · 26 U.S.C. § 6677(b)

   Pub. L. 93–406 substituted “and certain excise” for “chapter 42”

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 93–406 substituted “and certain excise” for “chapter 42”.

   Enacted provision · exact public law section
   (21) Section 6677(b) (relating to failure to file information 26 USC 6677. returns with respect to certain foreign trusts) is amended by striking out “chapter 42” and inserting in lieu thereof “and certain excise”.

4. 1976

   Pub. L. 94–455 title X § 1013(d)(2) · 90 Stat. 1520

   Inserted · 26 U.S.C. § 6677(a)

   Pub. L. 94–455 inserted “(or, in the case of a failure with respect to section 6048(c), equal to 5 percent of the value of the corpus of the trust at the close of the taxable year)” after “transferred to a trust”

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 94–455 inserted “(or, in the case of a failure with respect to section 6048(c), equal to 5 percent of the value of the corpus of the trust at the close of the taxable year)” after “transferred to a trust”.

   Enacted provision · exact public law section
   (2) Section 6677(a) (relating to failure to file information returns with respect to certain foreign trusts) is amended by striking out “to a trust” and inserting in lieu thereof “to a trust (or, in the case of a failure with respect to section 6048(c), equal to 5 percent of the value of the corpus of the trust at the close of the taxable year)”.

5. 1996

   Small Business Job Protection Act of 1996

   Pub. L. 104–188 § 1901(b) · 110 Stat. 1755

   1. Substituted · 26 U.S.C. § 6677

      Pub. L. 104–188, § 1901(b), substituted “information” for “information returns” in section catchline

   2. Amended · 26 U.S.C. § 6677

      Pub. L. 104–188, § 1901(b), amended text generally

   3. Substituted · 26 U.S.C. § 6677

      Pub. L. 104–188, § 1901(b), substituting present provisions for former provisions which related to civil penalty in subsec. (a) and nonapplicability of deficiency procedures in subsec. (b)

   Source evidence

   Code amendment note
   Pub. L. 104–188, § 1901(b), substituted “information” for “information returns” in section catchline and amended text generally, substituting present provisions for former provisions which related to civil penalty in subsec. (a) and nonapplicability of deficiency procedures in subsec. (b).

   Enacted provision · exact public law section
   (b) Increased Penalties.— Section 6677 (relating to failure to file information returns with respect to certain foreign trusts) is amended to read as follows: “SEC. 6677. FAILURE TO FILE INFORMATION WITH RESPECT TO CERTAIN FOREIGN TRUSTS. “(a) Civil Penalty.— In addition to any criminal penalty provided by law, if any notice or return required to be filed by section 6048— “(1) is not filed on or before the time provided in such section, or “(2) does not include all the information required pursuant to such section or includes incorrect information, the person required to file such notice or return shall pay a penalty equal to 35 percent of the gross reportable amount. If any failure described in the preceding sentence continues for more than 90 days after the day on which the Secretary mails notice of such failure to the person required to pay such penalty, such person shall pay a penalty (in addition to the amount determined under the preceding sentence) of $10,000 for each 30-day period (or fraction thereof) during which such failure continues after the expiration of such 90-day period. In no event shall the penalty under this subsection with respect to any failure exceed the gross reportable amount. “(b) Special Rules for Returns Under Section 6048(B).— In the case of a return required under section 6048(b)— “(1) the United States person referred to in such section shall be liable for the penalty imposed by subsection (a), and “(2) subsection (a) shall be applied by substituting ‘5 percent’ for ‘35 percent’. “(c) Gross Reportable Amount.— For purposes of subsection (a), the term ‘gross reportable amount’ means— “(1) the gross value of the property involved in the event (determined as of the date of the event) in the case of a failure relating to section 6048(a), “(2) the gross value of the portion of the trust’s assets at the close of the year treated as owned by the United States person in the case of a failure relating to section 6048(b)(1), and “(3) the gross amount of the distributions in the case of a failure relating to section 6048(c). “(d) Reasonable Cause Exception.— No penalty shall be imposed by this section on any failure which is shown to be due to reasonable cause and not due to willful neglect. The fact that a foreign jurisdiction would impose a civil or criminal penalty on the taxpayer (or any other person) for disclosing the required information is not reasonable cause. “(e) Deficiency Procedures Not to Apply.— 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).”.

6. 2010

   Hiring Incentives to Restore Employment Act

   Pub. L. 111–147 title V § 535(a) · 124 Stat. 71

   1. Inserted · 26 U.S.C. § 6677(a)

      Pub. L. 111–147, in concluding provisions, inserted “the greater of $10,000 or” before “35 percent”

   2. Substituted · 26 U.S.C. § 6677(a)

      Pub. L. 111–147, in concluding provisions, substituted “At such time as the gross reportable amount with respect to any failure can be determined by the Secretary, any subsequent penalty imposed under this subsection with respect to such failure shall be reduced as necessary to assure that the aggregate amount of such penalties do not exceed the gross reportable amount (and to the extent that such aggregate amount already exceeds the gross reportable amount the Secretary shall refund such excess to the taxpayer).” for “In no event shall the penalty under this subsection with respect to any failure exceed the gross reportable amount.”

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 111–147, in concluding provisions, inserted “the greater of $10,000 or” before “35 percent” and substituted “At such time as the gross reportable amount with respect to any failure can be determined by the Secretary, any subsequent penalty imposed under this subsection with respect to such failure shall be reduced as necessary to assure that the aggregate amount of such penalties do not exceed the gross reportable amount (and to the extent that such aggregate amount already exceeds the gross reportable amount the Secretary shall refund such excess to the taxpayer).” for “In no event shall the penalty under this subsection with respect to any failure exceed the gross reportable amount.”

   Enacted provision · exact public law section
   (a) In General.— Subsection (a) of section 26 USC 6677. 6677 is amended— (1) by inserting “the greater of $10,000 or” before “35 percent”, and (2) by striking the last sentence and inserting the following: “At such time as the gross reportable amount with respect to any failure can be determined by the Secretary, any subsequent penalty imposed under this subsection with respect to such failure shall be reduced as necessary to assure that the aggregate amount of such penalties do not exceed the gross reportable amount (and to the extent that such aggregate amount already exceeds the gross reportable amount the Secretary shall refund such excess to the taxpayer).”

   Effective date note
   Pub. L. 111–147, title V, § 535(b), Mar. 18, 2010, 124 Stat. 115, provided that: “The amendments made by this section [amending this section] shall apply to notices and returns required to be filed after December 31, 2009.”

9 of 9 references resolved to an enrolled provision