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If an LLC does not file its K-1 information return, can the IRS penalty flow up to the Members?

In every LLC partnership document I have reviewed, the maximum loss to a Member is their capital contribution. But if the IRS assesses a non-filing penalty to a defunct LLC, are the members liable?


Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

The answer is yes, IMHO, if the LLC had income. As an individual you should have recorded a fair estimate of that income along with an explanation.

On the other hand as a general member of the LLC, you should have access to the numbers and can always file the return itself.

Of there is no income/ loss, the IRS doesn't really care if you overpaid - but be mindful of statute of limitations for filing ended returns.

POI: I am not a tax expert by anyone's stretch of the imagination.


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