Source: IRS.GOV / issue Number: 2018-100

Taxpayers who make an effort to comply with the law, but are unable to meet their tax obligations due to circumstances beyond their control may qualify for relief from penalties.

After receiving a notice stating the IRS assessed a penalty, taxpayers should check that the information in the notice is correct. Those who can resolve an issue in their notice may get relief from certain penalties, which include failing to:

  • File a tax return
  • Pay on time
  • Deposit certain taxes as required

The IRS offers the following types of penalty relief:

Reasonable cause
This relief is based on all the facts and circumstances in a taxpayer’s situation. The IRS will consider this relief when the taxpayer can show they tried to meet their obligations, but were unable to do so. Situations when this could happen include a house fire, natural disaster and a death in the immediate family.

Administrative Waiver and First Time Penalty Abatement
A taxpayer may qualify for relief from certain penalties if he or she:

  • Didn’t previously have to file a return or had no penalties for the three tax years prior to the tax year in which the IRS assessed a penalty.
  • Filed all currently required returns or filed an extension of time to file.
  • Paid, or arranged to pay, any tax due.

Before asking for First Time Abatement relief, taxpayers can request that the IRS first consider the reasonable cause relief provision. This preserves access to the First Time Abatement, which taxpayers may only use every three years.

Statutory Exception
In certain situations, legislation may provide an exception to a penalty. Taxpayers who received incorrect written advice from the IRS may qualify for a statutory exception.

Taxpayers who received a notice or letter saying the IRS didn’t grant the request for penalty relief may use the Penalty Appeal Online Self-help Tool.

More Information:
Common Penalties for Individuals
Penalty Relief
The Right to Pay No More than the Correct Amount of Tax
The Right to Challenge the IRS’s Position and Be Heard
The Right to Appeal an IRS Decision in an Independent Forum

Share this tip on social media — #IRSTaxTip: Here’s what taxpayers should know about penalty relief https://go.usa.gov/xUazr

Do you have any questions?
Please fill in the following form.

13 + 14 =

Schedule an Appointment

Ask Our CPAs

What does a CPA do?

A CPA can provide assurance services which include examining annual reports and performing Read More...

Why Use a CPA?

Simply put, a CPA will SAVE YOU MONEY
in the long run and look out for your best interests.

Services

Accounting Services

We can help you and your team improve your business results.

Entrepreneurial Services

We're entrepreneurs too.

Personal Financial Services

Our clients and their families know we're here to help at every stage of life.

Business financial services

Our Business Advisory Services can help you turn risk into opportunity.

Quick Accountant Contact

Appointment Request - Footer Website

8 + 5 =

Featured Client

One Cycle RI

ONE Cycle is committed to leading and revitalizing minds and bodies through real world indoor cycling classes and group fitness classes. Our TEAM at ONE Cycle believe that the number 1 represents Courage, Ambition, Positivity, Raw Energy, and Unity.

Do you have any question?

Please fill in the following form.

14 + 10 =

Jonathan L. Ucran, CPA, LLC

651 Putnam Pike, Greenville, RI 02828

Providing tax and
accounting services
for individuals and
small businesses.