Penalty abatement is an IRS program that allows you to request the removal or reduction of penalties on late-filed or late-paid taxes. It applies if you can show reasonable cause—such as serious illness, natural disasters, or other unavoidable circumstances—for not meeting tax obligations on time.

Penalty abatement helps by:

• Reducing or eliminating penalties, which can add 5% per month for late filing (up to 25%) or 0.5% per month for late payment, plus interest.

• Lowering the total tax debt, making it easier to manage payments.

• Providing relief for honest mistakes or hardships, keeping your finances on track.

The IRS approves abatement requests on a case-by-case basis, requiring clear documentation and justification.

You can pursue penalty abatement in several ways:

• Do It Yourself: Submit a written request to the IRS, explaining your situation and providing supporting documents, such as medical records or proof of a natural disaster. This requires understanding IRS criteria, organizing evidence, and ensuring your explanation meets their standards—errors or incomplete submissions can lead to denial.

• Work with the IRS Directly: Contact the IRS by phone or mail to request abatement, answering questions and supplying details. This demands precise preparation and familiarity with IRS policies, which can be difficult without guidance.

• • Hire a Tax Professional: A professional is the best way to request penalty abatement. They evaluate your circumstances, prepare a compelling case with the required documentation, and advocate with the IRS. If your tax debt includes penalties from multiple years or complex issues, a professional can also explore additional relief options to resolve the situation.