What Is Penalty Abatement?

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When you are in tax trouble, interest, penalties, and fines accrue during the entire period you owe.  The Internal Revenue Service can, however, reduce or eliminate these extra charges if you can show cause.

If you or the IRS made a mistake in calculating the amount of taxes you owe, you could apply reasonable cause.

If you just plain forgot, you might still convince the IRS that your forgetfulness is reasonable cause to lower or eliminate the interest, fines, and penalties added to your past due amount.

Things like unavoidable absence, serious illness, or death in the family are reasons that suggest reasonable cause.

The inability to procure records could justifiably delay your capacity to pay and be grounds for a reasonable cause claim.

If you received incorrect advice from a tax expert, you can claim reasonable cause.

If you received advice in error from The IRS, you have a claim for reasonable cause.

If you experienced a disturbance beyond your control like a natural disaster, fire, or casualty, these events make for a reasonable cause claim.

Experiencing an act of God justifies a reasonable cause argument.

The Internal Revenue Service will, in reality, accept any reason as long as you can demonstrate that you used reasonable business care and still were unable to pay.

If you receive an IRS notification for back taxes, you can apply verbally, write back requesting abatement, or file Internal Revenue Service form 843.  When you do this, it is really good if you can include a check for the back taxes, not interest, penalties, or fines.  Indicate that the payment is only for the taxes and not for any of the interest, fines, or penalties.  In this package include a copy of your back tax notification and any proof that will substantiate your claims.

Be stalwart and prepare for some tough questioning from the Internal Revenue Service, but if you make your case well and document it, you could qualify for Internal Revenue Service tax abatement.

If you find yourself being assessed back taxes and penalties by the IRS, you might want to contact a tax attorney or tax resolution specialist.  Tax resolution teams are usually made up of former Internal Revenue Service Agents, CPAs, and tax attorneys.  In this situation it may take the work of these professionals to help you get your IRS tax abatement.


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