Update: Rejected Corporate Returns

Corporate returns that were rejected yesterday have 5 more days to refile and get accepted before any penalties will be levied.  For both the corporation and shareholders the penalties for filing late are steep.  Shareholders run the risk of receiving a $100 fine for being untimely. If the untimeliness boiled down to an intentional disregard, that fine could jump to $250 or 10% of the aggregate amount of items to be reported (the greater of the two).  For corporations,the penalties are $195, per number of months late,  then multiplied by the number principles in the corporation. That’s only if the corporation owes zero tax.  If the corporation owes tax, add 5% of the tax to the total per month late, up to 25%.

(http://www.irs.gov/instructions/i1120s/ch01.html#d0e586)