IRS Penalty Abatement
What is IRS penalty abatement?
An IRS penalty abatement request is simply a request by or on behalf of a taxpayer to have IRS penalties reduced or removed.These are penalties assessed by the IRS for a number of reasons like filing your tax return late or filing, but not paying your taxes on time. In addition to these penalties, which are up to 5% per month, the IRS also charges interest. So a relatively small tax debt can grow substantially in size of time with the addition of tax penalties and interest!
There are several techniques or tax strategies available to us as tax professionals for getting IRS penalties abated. The most commonly used technique is called a “Reasonable Cause” request; this is also is generally the least effective type of IRS penalty abatement strategy. And from our experience, given the recent economic climate, the IRS has been granting fewer and fewer “Reasonable Cause” requests (IRS form 843).
The second most common type of IRS penalty abatement request is based on specific reasons that the tax law allows for. These requests are very detailed, and in most cases the average taxpayer will not qualify.
Because of the required knowledge set, and experience necessary to pursue reducing IRS penalties through these types of channels, it is best left to a tax professional, or at a minimum, at least consult with one for assistance.
If you are faced with an IRS Audit or you are trying to get IRS penalties reduced, you should consider consulting with a tax professional today. To speak directly with a tax advisor at our firm, call us at (888) 918-8121. The call is free, the consultation is free, and you are under no obligation to hire us.