If you owe taxes and don’t pay them by the deadline, you will be assessed a penalty based on the amount of tax owed and interest will accrue. While there is a law that prevents the IRS from doing anything about the interest, you can request that the penalty be removed if your failure to pay the taxes by the deadline was out of your control. This is called a penalty abatement and is a form of tax resolution.
What Reasons Are Acceptable for Penalty Abatement?
The IRS reviews each case individually and considers the penalty abatement based on guidelines as opposed to hard, black and white rules. Each case is different and even similar cases have aspects that separate them from the others. For this reason, penalty abatements are not always predictable. However, there are certain reasons that tend to be obviously acceptable for penalty abatement requests. For example, hospitalization, non-cooperation from another to obtain your documents or a physical disability are pretty sure bets that you will receive a penalty abatement.
If you feel you have a suitable reason for missing the deadline to pay your taxes, you can request the penalty abatement from the IRS by writing them a letter. Below is a sample letter for your convenience. Click here for more information.
Sample Abatement Letter
Date
Penalty Abatement Coordinator
IRS
Address
City, State, Zip
Re: (Your Name
Social Security Number)
To Whom It May Concern:
I am writing to request an abatement of my assessed penalties in the amount of (insert dollar amount here – located on the assessed tax notice). Please see enclosed IRS Notice (include notice #) dated (include date of notice).
I was unable to pay by the deadline because (enter reason here. Include details and a clear depiction of the situation. Include as many documents as possible to support your reason. For example, if you were in the hospital when your deadline passed, submit a copy of your hospital bill, a doctor’s note, etc.)
I ask that these penalties be removed because I did not intentionally neglect to pay my tax debt on time. Circumstances outside of my control prevented me from being able to do so. Please see enclosed documented evidence. Should you have any further questions, I’m happy to answer them. I can be reached (enter best contact times here.)
Sincerely,
(Your Name
Contact Information)
Other Tips
It’s important that you do not consider the penalties abated until you have confirmation of such in writing from the IRS. Sending the letter is not the end of your job. There is no one to hold the IRS accountable for their lack of response so you must follow your request through until you have a written response from the IRS in your hands. Send the letter via a method that will give you documented proof of its delivery. Contact the IRS after a couple of weeks if you still haven’t gotten an answer. Retain a copy of the letter in case you are asked to resend it. Be diligent and relentless with your follow up.
Need Help?
IRS Tax Relief Now has significant experience with penalty abatement and is happy to discuss your issue with you free of charge with no obligation to hire our firm. Our friendly tax professionals are available 24 hours a day, seven days a week because we understand tax stress can sometimes keep you up at night. No need to go at this alone. We are experts in penalty abatement and should you decide to hire our firm, will be an asset to you in packaging your case in a way that will illustrate a clear picture of your circumstances to the IRS affording you the best chance at resolving the issue on your first try with the best results you qualify for.
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