Perhaps you have experienced tax penalties levied by the IRS as many taxpayers have because you were unable to pay your owed taxes on time. If you do have tax debt, rest assure the IRS will quickly add late fees and penalties on the amount you currently owe.Even though the interest is low, it will accumulate rather quickly which can increase your liability, making it even harder to pay it back.If your original amount was a lot less than what you currently owe, you may want to consider the option for tax relief using penalty abatement.
By taking advantage of this option, a taxpayer can get partial or total forgiveness of the tax liability. There have been several cases in which the IRS has removed 100% of the penalty.
The good news is the IRS makes it decision based on individual cases. If you can convince the IRS that you are unable to pay the tax debt because of your personal circumstances being anything of reasonable cause, you have a good chance of getting forgiveness.
The IRS’s guideline for granting abatement is pretty generous as long as the taxpayer has exercised caution and common business care when trying to pay their taxes.
Penalty abatement allows you to make it more personal and puts a face to the individual case presented to the IRS unlike other tax relief solutions.
In some situations, the IRS has been known to reimburse the penalties already paid by the taxpayer.
A taxpayer can decrease the penalties and levied interest when they use penalty abatement.
After explaining the difficulty of paying your taxes and making clear the reason for asking penalty abatement, there are three ways in which to present your case for abatement; Form 843, verbal and written. If you can gain the confidence of the IRS, your chances of abatement are much better. However, one can never be certain of the result of the appeal.
The IRS will not tread lightly. They will be diligent in their questioning, but if you stand your ground and can demonstrate your case vigorously, you have a really good chance to be granted abatement.