• There are many types of IRS tax penalties.
  • Reasonable cause and first-time abatement are the most common ways to get penalties removed.
  • It’s common to have to appeal penalty relief denials to get the IRS to look at your specific facts.

You can get expert help with IRS tax penalties.

What you need to know about IRS penalties

The IRS issues about 40 million penalties each year. There are almost 150 types of IRS penalties, but the most common ones are caused by late filing and late payment.

The IRS offers four options for taxpayers to get their penalties removed — if the circumstances fit.

You or your tax professional will need to investigate which options you may be able to use, and request penalty relief from the IRS.

How to address IRS penalties

1. Understand your options, based on your facts.

  • Tax penalties are based on the taxes you owe, so make sure you get the tax right first. Start by double checking your return. Consider amending your return if the taxes are incorrect.
  • Understand the four penalty abatement options :
  • Get the facts on your penalties:
    • Penalty type(s)
    • Amounts owed
    • Year(s) involved
    • Causes
  • Based on your situation, identify which penalty relief options you can use. Keep in mind that more than one option may be applicable.

2. Request penalty abatement from the IRS.

  • Put together your penalty abatement request for the specific option you’re pursuing.
  • Send your request to the proper unit at the IRS.
  • Use the right method to submit your request
    • If you’ve already paid the penalty, you may have to submit a claim-for-refund form.
    • If you’re requesting an administrative waiver for penalty abatement, you may be able to handle the request with a phone call to the right IRS function.
  • Respond quickly to any IRS requests for documents supporting your abatement request, and be prepared to argue the merits of your position.
  • If the IRS denies your request, appeal the decision by the deadline, and argue your position with the IRS Appeals Office .

3. If the IRS denies your request, appeal the decision by the deadline, and argue your position with the IRS Appeals Office.

  • Most appeals requests should be filed within 30 days of the IRS denial of the original appeal.
  • You’ll need to provide a chronology of events that caused you to file or pay late. Be specific on dates and provide backup documentation to support your chronology.
  • You may need to provide the IRS with additional legal arguments, such as a court case that supports your position.
  • The IRS will ask you how the unforeseen events affected your life and/or work. Be prepared to show how you couldn’t perform other critical tasks, such as making necessary payments for bills and utilities, and meeting personal and work obligations.

4. Prevent future penalties.

  • Make sure you file accurately and pay your taxes on time in the future.
  • If you have penalties related to late payments, adjust your withholding and/or make estimated tax payments.

How to get expert help

Nugent & Associates can help you figure out which penalty abatement option you can pursue – and help you request it from the IRS.

Have these five items available for your appointment with us

  1. A copy of your IRS notice(s)
  2. A copy of the tax return in question
  3. A chronology of the events surrounding the time of the issue
  4. A history of any past penalties
  5. Documents that support your reason for abatement

At Nugent & Associates, we're not just number crunchers. We bring over 3 decades of invaluable certified public accounting and tax expertise to your company – serving as business and financial strategists who can offer such services as tax and financial planning, investment advice, diligent financial records, and help with estate planning.

Even better, we will give you time to focus on what you do best: running the day-to-day operations that drive your business toward success.

Take advantage of our FREE and no obligation business checkup.

We will visit you at your business at a time and day convenient for you, analyze your numbers, discuss your goals and concerns and report back with a complimentary detailed written analysis to help your business succeed!

At Nugent & Associates, we're not just number crunchers. Our people bring decades of invaluable certified public accounting and financial and tax expertise to you – offering tax and financial strategies to individuals such as yourself. If you have any questions or concerns about your own tax, financial or investment matters, please do not hesitate to contact us.

Experienced tax and financial experts are not just for the super rich. At a reasonable fee you too can maximize your wealth and receive professional guidance for retirement, and/or any tax issues you may be facing, no matter your situation, with a tax and financial expert as your consultant.

Contact Nugent & Associates today. We don't charge for phone calls. You may just find you found an ally in your quest to have a great financial future.

After all, at Nugent & Associates, we succeed when you succeed!


Disclaimer:

PLEASE READ THE FULL TERMS AND CONDITIONS OF THIS WEBSITE BEFORE USING THIS WEBSITE.

This page is intended to be informational. This website, nor any of the information contained on this site constitutes professional, business, tax or legal advice and is not a substitute for such advice nor does it create a professional-client relationship between you and Nugent & Associates.

State and federal laws change frequently, and the information in this page may not reflect your own state’s laws or the most recent changes to the law.

The information contained within this website should not be considered as a solicitation or an offer for a professional-client relationship. Materials contained in this website are of a general nature and should not be substituted for professional advice. Nugent & Associates is providing this website and the information contained herein only as a convenience to you. Nugent & Associates assumes no liability or responsibility for any errors or omissions contained within this website. There is no guarantee that the information included on this site is current, accurate, complete, useful, or reliable.

Tax Planning & Preparation

We assist our clients in individual and business tax planning throughout the year.

Nugent & Associates provides:
  • Year-Round analysis to ensure a smooth and predictable year-end close.
  • Assist in establishing retirement planning.
  • Performs in-depth review of all deductions available.

Monthly/Quarterly
Financial Statements


Nugent & Associates offers outstanding accounting services and acts as a quasi-controller for companies who do not employ their own full-time accountants.

This allows our clients with more time to focus on new services, new customers and other core business issues.

Business Planning, Budgeting
& Growth Strategies


Nugent & Associates assists it clients with:
  • Starting a new venture, product or service
  • Expanding a current organization, product or service
  • Buying a new business, product or service
  • Turning around a declining business

QuickBooks Training
& Support Services


As Certified QuickBooks Professional Advisors, we can be of assistance with QuickBooks accounting or payroll and help increase your productivity and efficiency.