Penalty Abatement
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IRS penalties can add 50% or more to your underlying tax liability—failure to file (25%), failure to pay (25%), plus accuracy penalties (20%). Many taxpayers don’t realize these penalties aren’t always permanent. With the right approach, penalties can often be reduced or eliminated entirely.
First-Time Penalty Abatement
First-time abatement is an administrative waiver the IRS is instructed to grant when taxpayers qualify. Requirements include no penalties in the prior three tax years, all required returns filed (or extensions on file), and current on tax payments or in an approved payment plan. This applies to failure-to-file, failure-to-pay, and failure-to-deposit penalties. If you qualify, success is essentially guaranteed.
Reasonable Cause Abatement
When circumstances beyond your control prevented compliance, you can request reasonable cause relief. The IRS considers natural disasters, serious illness or death of you or immediate family, unavoidable absence, inability to obtain necessary records, erroneous advice from the IRS or tax professionals, and fire, casualty, or other disturbances.
The key test: you must demonstrate ‘ordinary business care and prudence’—that you tried to comply despite challenging circumstances. Documentation is crucial for reasonable cause claims.
How I Approach Penalty Abatement
I analyze your compliance history and circumstances to identify the strongest abatement arguments. For first-time abatement, a phone call is often sufficient. For reasonable cause, I prepare detailed written requests with supporting documentation that addresses exactly what the IRS needs to see.
Strategic transparency—acknowledging weaknesses in your case before the IRS raises them—builds credibility and often produces better results. If your first request is denied, I can request manager review or file an appeal.
If you’ve been assessed IRS penalties and want to explore abatement options, contact Boss Tax Law today.