Tag Archive for IRS Penalty Abatement

When Seeking IRS Penalty Abatement, What Qualifies As Reasonable Cause?

When Seeking IRS Penalty Abatement, What Qualifies As Reasonable Cause?

If you are facing penalties from the IRS for paying or filing your taxes late, you have some options to get those assessments removed. Reasonable cause is one method to getting penalty abatement. Learn more about reasonable cause and how to qualify for it.

Key Insights We Will Discuss

-What is reasonable cause?
-How to qualify for reasonable cause
-What Is Reasonable Cause?

Reasonable cause can be used when you have a legitimate excuse for not paying or filing your taxes on time. When claiming reasonable cause, you must be able to prove that it was out of your control to file or pay on time and that you tried to file but it wasn’t possible.

According to the IRS, some examples of reasonable cause can include:
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Understanding IRS Penalty Abatement And Reasonable Cause

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IRS Penalty Abatement And Reasonable Cause

Being assessed a penalty by the Internal Revenue Service can be an overwhelming situation. Faced with potentially massive penalties a taxpayer’s financial future may seem bleak. Fortunately, there may be relief available. The IRS offers qualified taxpayers something called “penalty abatement.” But, what is and how is it determined? To provide you with some knowledge of the process, here is our guide to understanding   IRS penalty abatement and reasonable cause.

What Is IRS Penalty Abatement?

When the IRS slaps taxpayers with a penalty for failing to file or failing to pay their federal taxes, there are certain steps the penalized party can take to resolve their issues. One of these is penalty abatement. The IRS is willing to consider any sound reason why a taxpayer failed to file a tax return, make a deposit or even pay any past-due taxes. Simply having a lack of funds is inadequate for claiming an abatement. The reasons behind the lack of funds, however, may be considered.   These circumstances are called “reasonable cause” and include:

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