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What is a First Time Tax Penalty Abatement?

December 8, 2019
Weisberg Kainen Mark, PL

If the IRS has assessed penalties for your failure to file or failure to pay taxes, you might be eligible for a first-time tax abatement (FTA) waiver. You may request a waiver for penalties related to your personal taxes, or you may also apply for an FTA for penalties related to your business. In addition to the failure-to-pay and failure-to-file penalties, you may request an FTA for your business for penalties related to failure to make quarterly deposits.

What Criteria Must I Meet?

Just as the IRS generally does not grant abatements for ignorance, you must show you are aware of your mistake and are taking steps to remedy the situation to be considered for a waiver. There are three requirements for you or your company to satisfy. 

  • There are no outstanding tax returns. Although failure to file is a violation that may be alleviated by the IRS’s FTA waiver, you must at least have filed for an extension so the federal government knows you are aware of your error.
  • You must have paid tax due or at least arranged payments. If you have already paid both your tax liability and associated penalties and interest, you may request a FTA.  If you prevail, the IRS will issue you a refund. 
  • You don’t have any previous tax violations the past three years. The IRS will look at your prior record in assessing your FTA application.  You must have filed and paid timely for the past three years in order to be eligible for a FTA.

Are There Other Situations in Which I May Receive an FTA?

The IRS will almost always reject a request for a penalty abatement if your reason is based on a lack of knowledge about the tax-filing process. There are penalties other than for failure-to-file and failure-to-pay for which an abatement may be considered, but those are handled on a case-by-case basis. Excuses that the IRS generally deems acceptable include natural disasters, inability to physically access pertinent files, death, and other significant disruptions to your life. 

How Do I Request a First Time Penalty Abatement?

You may file for an FTA by mail or phone, or through the internet. Many people prefer requesting for a waiver by phone, as the application will be dealt with in real time. If you choose to call, be sure to take thorough notes of your conversation and get the name of the IRS employee you speak with. Remember that the application is not a time to negotiate; you either qualify or you do not.

We Know How to Deal with the IRS

Give us a call today at (305) 374-5544 if you have any intention of filing for a first-time abatement. The FTA is designed to forgive honest mistakes made by clean individuals, but there are certain steps you must take to be considered. We can also help if you believe you were erroneously denied an FTA. 

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Weisberg Kainen Mark, PL

As experienced trial lawyers with a passion for justice, our firm provides clients with compelling advocacy, attorney availability, and creative solutions to your tax or criminal law matters.

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