Do I Qualify for an IRS Penalty Abatement?
The IRS may assess penalties for filing or paying late and for other failures to meet tax requirements. Review any IRS notice and respond by its stated deadline. Penalty relief may reduce or remove an eligible penalty; it generally does not eliminate the underlying tax.
What is a Tax Penalty Abatement?
A Penalty Abatement reduces or removes an eligible IRS penalty. Relief may depend on reasonable cause, administrative relief or a statutory exception. Failure-to-file penalties for individual income tax returns generally accrue monthly, subject to limits and exceptions. File a missing return promptly. A regular filing extension generally must be requested by the original deadline and does not extend the payment deadline.
How Does an IRS Penalty Abatement Work?
Available relief depends on the penalty and applicable requirements. Reasonable-cause requests explain why the taxpayer could not comply despite ordinary care. Administrative relief may instead depend on compliance history and the relevant return or tax period; some eligible relief is automatic.
The following circumstances may be relevant to a reasonable-cause review.
- Circumstances beyond your control:
Natural disasters, serious illness or other qualifying events may support reasonable cause when they prevented compliance despite ordinary care. - Financial circumstances:
Lack of funds alone generally does not establish reasonable cause. The IRS considers the surrounding facts and whether the taxpayer exercised ordinary care. - Relevant facts and records:
Explain what happened, when it happened and how it affected filing or payment. Include supporting records when needed.
How to Qualify for an IRS Penalty Abatement?
Follow the instructions on the IRS notice. Some requests can be handled by phone; a written explanation and supporting records may be needed depending on the relief requested.
When a written explanation is needed, focus on the facts relevant to the request.
- Be Clear
Explain the relevant facts clearly and include the information needed to evaluate the request. - Be Accurate
Provide accurate dates, amounts and supporting information. - Be Specific
Describe the circumstances that affected filing or payment and the steps taken to comply.
IRS Form 843
Some penalty-relief requests can be considered by phone. If the IRS cannot approve relief that way, a written request using IRS form 843 may be appropriate; follow the notice and form instructions. A qualified representative can help review the available options.
Official IRS references: Penalty relief · Reasonable cause · Administrative relief · Failure-to-file penalties · Filing extensions.
Speak to a Tax Relief Specialist
A Family Tax Relief specialist will present the strongest possible argument for abatement of your penalties. We are confident that you will find our team of tax professionals not only competent and qualified, but exceedingly helpful even if you cannot afford professional representation.
