Sample Penalty Abatement Letter to IRS to Waive Tax Penalties
If the IRS has assessed penalties against you for failing to pay your federal taxes in full, paying them late, or failing to report your income, you do have the option of requesting that the IRS abate or forgive these penalties. While you are still responsible for any delinquent taxes that you owe, the IRS does not require you to pay any penalties on your delinquent taxes if your request for abatement is successful. Since penalties on delinquent taxes can be quite high, it is definitely an advantage to you if the IRS granted your request for a penalty abatement.
You can only receive a penalty abatement from the IRS if you can show good or reasonable cause for being unable to pay your delinquent taxes in full. The IRS will consider abatement requests for the following types of reasons:
- Civil disturbance such as a hurricane or flood
- Serious illness of you or a family member
- Death of a family member
- Inability to pay even though you were using ordinary care in your business operations
- Reasons beyond your control that made you unable to determine your tax
- Other reasons despite the fact that your were using ordinary business care, or
- Reasonable reliance on incorrect advice given to you by the IRS over the phone.
If your situation fits any of these reasons, then you may be entitled to a penalty abatement simply by asking the IRS for the abatement. In order to request a penalty abatement, you can call the IRS (especially if it is the first-time you are requesting it). You can also write a penalty abatement request letter to the IRS, and enclose a copy of your IRS notice showing your penalty, as well as any written documentation that you have in support of the reason for your penalty abatement request. You also should complete IRS Form 843 – Claim for Refund and Request for Abatement, and include it along with your letter. Furthermore, while it is not required, you should send payment for your delinquent taxes along with your penalty abatement request letter to the IRS, if you can do so.
The sample letter is only for informational purposes only. Please consult with a tax firm or a licensed tax professional before sending the letter.
Sample Penalty Abatement Request Letter
Penalty Abatement Coordinator
Address (as stated on your IRS notice of penalty)
Your Social Security Number
RE: Request for Penalty Abatement
To Whom It May Concern:
I am requesting an abatement of the penalties on the taxes that I owe. These penalties are in the total amount of $___________, as shown by the IRS tax notice of penalties dated ____________, which I have enclosed.
I: (choose one of the following options)
_____ paid my taxes late
_____ filed my taxes late
_____ did not report income
for the following reason(s):
(In this section of your letter, describe the reason(s) that you paid your taxes late, filed your taxes late, or failed to report income. Common examples of valid reasons include the death of a family member, serious illness of you or a family member, a civil disturbance such as a tornado, flood, or fire, or any other reason that prevented you from complying with the IRS.)
Please find enclosed a copy of documentation that supports my reason(s) for requesting an abatement of penalties.
(In this section of your letter, describe the type of documentation supporting the reason(s) that you paid your taxes late, filed your taxes late, or failed to report income. Examples of supporting documentation include death certificates, statements from a doctor regarding illness or a medical condition, or pictures showing your home following a fire or hurricane.)
Please approve my request for abatement of penalties for good cause. I also have enclosed a payment in the amount of $_____________ toward the taxes that I owe. (Omit the previous sentence if you cannot enclose a payment toward your taxes. However, you should try to enclose a payment if possible.)
If you have any further questions, please feel free to contact me at __________________ (your phone number, including area code).
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