If you’re facing IRS penalties on your taxes, you’re not alone. Many people deal with IRS penalties, fines, and fees throughout their life. In many cases, the IRS can waive penalties. You might qualify to have your penalty dropped, lowered, or forgiven. Explore how to get IRS penalties waived to learn about all of your options.
Why Does The IRS Impose Penalties?
The tax code lists more than 100 different penalties, but some are more common than others. The most common reason behind IRS penalties is failing to pay or file taxes. Are you wondering, can I get the IRS to waive penalties and interest? Check to see if you have one of these standard penalties.
Failure To Pay Penalty
Failure to Pay is the most common penalty. Up to 56% of all penalties are imposed on people who don’t pay their taxes on time.
Failure To File Penalty
This is the second most common penalty. This punishment is assigned if you don’t file your return on time. Up to 14% of penalties are for failing to file a tax return.
Failure To Deposit Penalty
This penalty is for businesses, not for individual taxpayers. A company will face this penalty if it doesn’t pay employment taxes or if it makes a mistake with the payment.
S corporations and partnerships will face this IRS penalty if they file late.
Estimated Tax Penalty
This penalty is assigned to taxpayers if they mistakenly estimate their taxes for a certain year.
Many people who deal with tax problems need to know how to get IRS penalties waived. Luckily, you can learn about IRS waiving penalties 2021 to explore all your options. You may be able to use a first-time penalty abatement or other strategies to lower your fees.
How Do I Get IRS Penalties Removed?
You can dispute IRS penalties by contacting the IRS. There are four reasons you can include in your penalty waiver request.
1. Statutory Exception
A statutory exception proves that you have a specific authority that’s exempt from penalties. These situations aren’t very common. For example, exceptions include natural disaster relief or combat zone relief. If you have a statutory exception, you will usually explain it while you’re filing your taxes.
2. IRS Error
Did you make a mistake in your taxes because the IRS gave you bad advice? This situation is very rare, but if it happened to you, you can file an IRS penalty waiver form. It’s hard to prove that your penalty is due to IRS mistakes because the IRS doesn’t normally give written advice. In very rare cases, the IRS will give penalty relief based on bad oral advice.
3. Reasonable Cause
If you can prove that you couldn’t pay or file your taxes due to reasonable cause, the IRS might waive your penalties. Common examples of reasonable cause include getting bad advice from your tax software or tax professional. You’ll also need to prove that you used standard business practices. Neglect, negligence and illegal activities don’t count as reasonable causes.
It’s hard to win a reasonable cause claim, but it is possible. Make sure that the IRS is considering the full context of your situation. If your first sample letter to IRS to waive penalties is denied, you can request an appeal. Explain the complete situation to help the IRS understand your concerns.
4. Administrative Waiver
The IRS has certain policies and procedures it can use to waive penalties. The most frequent waiver is the first-time penalty abatement IRS. First-time abatement can be used to cancel out Failure to File, Failure to Pay, and Failure to Deposit penalties.
Can I get the IRS to waive penalties and interest? You may qualify for a first-time abatement (FTA) if you meet the following description:
- You filed and paid your taxes properly for the past three years
- You have penalties on Form 1040, Form 1120, or payroll or pass-through entities
A first-time abatement is the easiest way to get tax relief. You can call the IRS at their toll-free number to request an abatement. If you don’t want to talk to the IRS yourself, or if you’re already working with a professional tax team, your tax professional can call the IRS for you.
Can You Negotiate IRS Penalties?
There are many strategies for dealing with IRS penalties. If you qualify for a first-time abatement, it should be easy to work with the IRS. You can negotiate and have your penalty lowered or dropped in these cases.
Other tax situations can be more complicated. You might also owe back taxes in addition to penalties. It’s important to know how to get IRS penalties waived in these situations. Some people have multiple years of tax debt and penalties. If your taxes are confusing, intimidating, or stressful, contact the IRS Tax Relief Network for expert services. We can help clients resolve back taxes, negotiate penalties, or lower their payments.
Does The IRS Ever Forgive Penalties?
The IRS assigns penalties for many reasons. However, it is also willing to forgive penalties in many cases. Many people who qualify for a first-time penalty abatement can have their penalties forgiven. If you have other penalties, interest, or back taxes, you can still try to resolve your IRS tax debt. Professionals like the IRS Tax Relief Network can help you work with the IRS to have your penalties and other issues forgiven.
Learn More About Your Taxes
Taxes can be complicated, but they don’t need to ruin your life. Many tax penalties can be forgiven using first-time penalty abatement. Once you know how to get IRS penalties waived, you can rebuild your financial situation. The IRS Tax Relief Network can help you resolve your tax debt from the comfort of your home. Click here to learn more about resolving your tax penalties today.