IRS Penalty Abatement: Removing Penalties Owed
If you don’t believe that you should have to pay certain federal penalties or interest, you can apply for IRS penalty abatement. If you qualify, the IRS removes some or all of your penalties.
To qualify, you need to prove that there was a reasonable cause for filing or paying late. In some cases, you can qualify if the IRS made an error or delayed your return, or if the IRS gave you bad advice in writing that led to the penalties and interest. You can also receive abatement if it’s your first offense and it is one of the penalties the IRS will abate.
If you can prove that there was a serious reason you didn’t file or pay your taxes, you may qualify for reasonable cause. Follow the link to find out about reasonable cause.
IRS Delays or Errors
If the IRS made mistakes on your assessment, you may apply for abatement in this category. You can also apply if the IRS caused delays.
When you have penalties due to receiving incorrect advice from the IRS, you can apply for this type of abatement. It is rarely seen. See the link above for more information.
The First Time Penalty Abatement (FTA) program is for taxpayers with a good track record of compliance. If you have late payment penalties or other penalties for the first time, you may qualify. This program is not for repeat offenders.
You can apply verbally, in writing, or by using Form 843. Regardless of the method you choose, you need to explain what you failed to pay the taxes owed.
You can request penalty abatement by writing a letter to the IRS. The letter should explain why you deserve abatement. Fortunately, we have a sample petition letter so you get a sense of what the IRS may expect. It is for information purposes only. We believe calling the IRS can be more effective in many cases.
You can use IRS Form 843 to claim a refund or ask for an abatement. The link above provides details and instructions for this form.
When you work with tax services professionals, they gather the necessary tax records and prove to the IRS that the penalties should be removed. These services reduce your overall taxes and make your payments smaller. Here’s more information on that process.
You can find a list of tax professionals with penalty abatement experience by doing a search below and then using the search solution filters to filter by "penalty abatement."