Requesting Penalty Abatement from the IRS

The penalty abatement process is a way to reduce the penalty for tax non-compliance. Requesting penalty abatement can be done in different ways, but it must be done before the IRS has started an audit or criminal investigation. Unfortunately, many taxpayers assessed to have incurred penalties either do not request relief or are denied relief because they didn’t fully understand how IRS penalty abatement works.

The penalty abatement process can help you get back on track with your taxes, so read on to learn more!

What is penalty abatement from the IRS?

There are over 145 various types of IRS penalties. If you are hit with IRS penalties, you can request that the penalties be “abated” or be completely or partially removed or forgiven.

The different types of penalties follow different abatement request procedures. For example,  Failure to File (FTF) and Failure to Pay (FTP) penalties are assessed electronically when a return is filed. Chances of having these penalties reduced if you show “reasonable cause” for why you didn’t file or pay on time, particularly if you are a taxpayer in good standing. Other penalties, such as the estimated tax penalty, are not abatable, along with penalties that may have been proposed during an audit or investigation.

How to improve your chances of penalty abatement

After the IRS has assessed a penalty, you can request penalty abatement by calling the IRS or writing a penalty abatement letter. Improve your chances of getting your IRS penalties abated by:

Submitting reasonable cause abatements in writing. FTA abatement can be done over the phone; however, for cases related to proving reasonable cause, you will need to complete a request for abatement and attach evidence supporting your reasonable cause claim.

Utilizing IRS’s First-time Penalty Abatement Relief (FTA), applies to both the FTF and FTP penalties. You can make FTA requests over the phone.  

Not forgetting to request abatement before the statute expires. Typically, you have three years from the date the return was filed to request abatement of penalties. Three years is the normal refund statute of limitations, but it can also be two years after the penalty was paid. Either way, don’t let the statute expire and lose the opportunity to request abatement.

Including specific circumstances in your reasonable cause abatement request. Be able to show proof that led to your noncompliance to pay taxes in a timely manner, including written statements that your failure to pay was not due to willful neglect. If your reasonable cause were due to incapacity or inability to perform normal activities such as your job, you would also need to show evidence, such as hospital records.  

Following up on your abatement requests. Abatement requests can get lost in the vast IRS system. Calling the IRS to follow up can help push your request along to make an abatement decision.

As tax resolution specialists, we can request penalty abatement for you and increase your chances of getting approved for abatement. Contact Golden Tax Relief today,​ and we can help you with your IRS requests. 

Call Golden Tax Relief at 844 229 8936 today. 

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