Filing your tax returns is rarely easy, and receiving one of over 150 possible Internal Revenue Service (IRS) penalties makes the process even harder and more expensive. Fortunately, receiving a penalty notice doesn’t necessarily mean the IRS has made a final decision. In many cases, you can apply for relief from steep fines through penalty abatement. Learn what the IRS penalty abatement form is and find out when and how to use it to request relief.
Although you can receive penalties for dozens of reasons, including errors and missed deadlines, the IRS only offers relief for a few different infractions. Before you fill out the IRS penalty abatement form, assess whether you’re eligible for one of the three main types of tax penalty relief.
While the IRS won’t exactly give you a pass for making a single mistake on your tax return, the agency does offer a special category of relief for first-time offenders. You might be eligible for a First-Time Penalty Abatement if all of these statements apply to you:
If you and your family have had a tough year due to circumstances beyond your control, you could also be eligible for penalty abatement. You might qualify for Reasonable Cause relief if the following situations apply to you and your family:
To make a case for penalty relief due to Reasonable Cause, you’ll need supporting documentation. Before requesting abatement, write down the timeline of events, gather relevant court records or hospital forms, and get documentation of any natural disasters.
The IRS does occasionally make errors, and in some cases, those mistakes can cause you to receive penalties that you shouldn’t be responsible for paying. To find out if you qualify for a Statutory Exception waiver, you’ll need to have the following on hand:
If you’ve determined that you should be eligible for one of the three types of relief, you’ll want to submit your IRS penalty abatement form right away. Follow these general guidelines to complete IRS Form 843 to the best of your ability:
The IRS might not agree to remove your tax penalty the first time you make a request. If you receive a denial but you still believe that you’re eligible for penalty abatement, use the IRS’s penalty appeal process to move your request forward.
In many cases, you can use the online Penalty Appeal tool to get more information about the process. To use this tool, you must have submitted a written request for penalty abatement, gotten a denial from the IRS, and received a Notice of Disallowance in the mail. If you have additional questions after using the tool or if you need to talk to an examiner directly, call the IRS’s customer service line.
If you want to submit an appeal, keep in mind that you’ll have to do so within 30 days of receiving a denial from the IRS. To initiate the appeals process, you’ll have to file a formal written protest that includes your contact information, a statement requesting an appeal, a copy of the notices you’ve received, a list of the matters you disagree with, and reasons or facts that support your position.