
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC6695]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                Subtitle F--Procedure and Administration
 
  CHAPTER 68--ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND ASSESSABLE 
                                PENALTIES
 
                   Subchapter B--Assessable Penalties
 
                       PART I--GENERAL PROVISIONS
 
Sec. 6695. Other assessable penalties with respect to the 
        preparation of income tax returns for other persons
        

(a) Failure to furnish copy to taxpayer

    Any person who is an income tax return preparer with respect to any 
return or claim for refund who fails to comply with section 6107(a) with 
respect to such return or claim shall pay a penalty of $50 for such 
failure, unless it is shown that such failure is due to reasonable cause 
and not due to willful neglect. The maximum penalty imposed under this 
subsection on any person with respect to documents filed during any 
calendar year shall not exceed $25,000.

(b) Failure to sign return

    Any person who is an income tax return preparer with respect to any 
return or claim for refund, who is required by regulations prescribed by 
the Secretary to sign such return or claim, and who fails to comply with 
such regulations with respect to such return or claim shall pay a 
penalty of $50 for such failure, unless it is shown that such failure is 
due to reasonable cause and not due to willful neglect. The maximum 
penalty imposed under this subsection on any person with respect to 
documents filed during any calendar year shall not exceed $25,000.

(c) Failure to furnish identifying number

    Any person who is an income tax return preparer with respect to any 
return or claim for refund and who fails to comply with section 
6109(a)(4) with respect to such return or claim shall pay a penalty of 
$50 for such failure, unless it is shown that such failure is due to 
reasonable cause and not due to willful neglect. The maximum penalty 
imposed under this subsection on any person with respect to documents 
filed during any calendar year shall not exceed $25,000.

(d) Failure to retain copy or list

    Any person who is an income tax return preparer with respect to any 
return or claim for refund who fails to comply with section 6107(b) with 
respect to such return or claim shall pay a penalty of $50 for each such 
failure, unless it is shown that such failure is due to reasonable cause 
and not due to willful neglect. The maximum penalty imposed under this 
subsection on any person with respect to any return period shall not 
exceed $25,000.

(e) Failure to file correct information returns

    Any person required to make a return under section 6060 who fails to 
comply with the requirements of such section shall pay a penalty of $50 
for--
        (1) each failure to file a return as required under such 
    section, and
        (2) each failure to set forth an item in the return as required 
    under section,

unless it is shown that such failure is due to reasonable cause and not 
due to willful neglect. The maximum penalty imposed under this 
subsection on any person with respect to any return period shall not 
exceed $25,000.

(f) Negotiation of check

    Any person who is an income tax return preparer who endorses or 
otherwise negotiates (directly or through an agent) any check made in 
respect of the taxes imposed by subtitle A which is issued to a taxpayer 
(other than the income tax return preparer) shall pay a penalty of $500 
with respect to each such check. The preceding sentence shall not apply 
with respect to the deposit by a bank (within the meaning of section 
581) of the full amount of the check in the taxpayer's account in such 
bank for the benefit of the taxpayer.

(g) Failure to be diligent in determining eligibility for earned income 
        credit

    Any person who is an income tax return preparer with respect to any 
return or claim for refund who fails to comply with due diligence 
requirements imposed by the Secretary by regulations with respect to 
determining eligibility for, or the amount of, the credit allowable by 
section 32 shall pay a penalty of $100 for each such failure.

(Added Pub. L. 94-455, title XII, Sec. 1203(f), Oct. 4, 1976, 90 Stat. 
1692; amended Pub. L. 95-600, title VII, Sec. 701(cc)(1), Nov. 6, 1978, 
92 Stat. 2923; Pub. L. 98-369, div. A, title I, Sec. 179(b)(2), July 18, 
1984, 98 Stat. 718; Pub. L. 99-44, Sec. 1(b), May 24, 1985, 99 Stat. 77; 
Pub. L. 101-239, title VII, Sec. 7733(a)-(d), Dec. 19, 1989, 103 Stat. 
2402, 2403; Pub. L. 105-34, title X, Sec. 1085(a)(2), Aug. 5, 1997, 111 
Stat. 956.)


                               Amendments

    1997--Subsec. (g). Pub. L. 105-34 added subsec. (g).
    1989--Subsecs. (a) to (c). Pub. L. 101-239, Sec. 7733(a)-(c), 
substituted ``$50'' for ``$25'' and inserted at end ``The maximum 
penalty imposed under this subsection on any person with respect to 
documents filed during any calendar year shall not exceed $25,000.''
    Subsec. (e). Pub. L. 101-239, Sec. 7733(d), substituted ``returns'' 
for ``return'' in heading and amended text generally. Prior to 
amendment, text read as follows: ``Any person required to make a return 
under section 6060 who fails to comply with the requirements of such 
section shall pay a penalty of--
        ``(1) $100 for each failure to file a return as required under 
    such section, and
        ``(2) $5 for each failure to set forth an item in the return as 
    required under such section,
unless it is shown that such failure is due to reasonable cause and not 
due to willful neglect. The maximum penalty imposed under this 
subsection on any person with respect to any return period shall not 
exceed $20,000.''
    1985--Subsec. (b). Pub. L. 99-44 repealed Pub. L. 98-369, 
Sec. 179(b)(2), which amended subsec. (b), and provided that the 
Internal Revenue Code of 1954 [now 1986] [this title] shall be applied 
and administered as if section 179(b)(2) (and the amendments made by 
such section) had not been enacted. See 1984 Amendment note and 
Effective Date of 1985 Amendment note below.
    1984--Subsec. (b). Pub. L. 98-369 amended subsec. (b) generally, 
substituting provisions dealing with failure to inform taxpayer of 
certain recordkeeping requirements of section 274(d) of this title or to 
sign returns, for provisions dealing with failure to sign returns. See 
1985 Amendment note above.
    1978--Subsec. (f). Pub. L. 95-600 inserted provision relating to 
deposits by a bank.


                    Effective Date of 1997 Amendment

    Amendment by Pub. L. 105-34 applicable to taxable years beginning 
after Dec. 31, 1996, see section 1085(e)(1) of Pub. L. 105-34, set out 
as a note under section 32 of this title.


                    Effective Date of 1989 Amendment

    Section 7733(e) of Pub. L. 101-239 provided that: ``The amendments 
made by this section [amending this section] shall apply to documents 
prepared after December 31, 1989.''


                    Effective Date of 1985 Amendment

    Amendment by Pub. L. 99-44 effective as if included in the 
amendments made by section 179(b) of Pub. L. 98-369, see section 6(a) of 
Pub. L. 99-44, set out as a note under section 274 of this title.


                    Effective Date of 1984 Amendment

    Amendment by Pub. L. 98-369 applicable to taxable years beginning 
after Dec. 31, 1984, see section 179(d)(2) of Pub. L. 98-369, set out as 
an Effective Date note under section 280F of this title.


                    Effective Date of 1978 Amendment

    Section 701(cc)(3) of Pub. L. 95-600 provided that: ``The amendments 
made by this subsection [amending this section and section 7701 of this 
title] shall apply to documents prepared after December 31, 1976.''


       Repeal of Regulations Covering Substantiation by Adequate 
                         Contemporaneous Records

    Regulations issued before May 24, 1985, to carry out the amendment 
of subsec. (b) of this section by section 179(b)(2) of Pub. L. 98-369 to 
have no force and effect, see section 1(c) of Pub. L. 99-44, set out as 
a note under section 274 of this title.

                  Section Referred to in Other Sections

    This section is referred to in sections 6103, 6504, 6511, 6696, 7407 
of this title.
