Sometimes, you owe the IRS money. You might also face penalties for various reasons. These penalties can be for late filing or late payment. You can request the IRS to remove these penalties. This is done by writing a penalty abatement letter.
Writing this letter can feel daunting. Don’t worry! We’ve got you covered. We will provide sample letters. These samples are easy to use. They can help you craft your own letter.
We’ll share different letter examples. Each sample addresses a specific situation. You can adapt these samples to your needs. Let’s get started and help you save money!
Sample Letter To Irs To Remove Penalties
[Your Name]
[Your Address]
[Your City, State, ZIP Code]
[Your Phone Number]
[Your Email Address]
[Date]
Internal Revenue Service
[IRS Address]
[IRS City, State, ZIP Code]
**Subject: Request for Penalty Abatement – [Your Tax Year] – [Your Social Security Number or EIN]**
Dear Internal Revenue Service,
I am writing to request a waiver of penalties assessed for the [Tax Year] tax year. My Social Security Number (or Employer Identification Number) is [Your Social Security Number or EIN].
I received a notice regarding penalties for [Specify the penalty, e.g., failure to file, failure to pay, accuracy-related penalty]. The penalty amount is [Penalty Amount].
I believe these penalties should be removed because [Clearly explain the reason for requesting penalty abatement. Choose one or more of the following reasons and provide specific details]:
* **Reasonable Cause:** [Describe the circumstances that prevented you from filing or paying on time. Examples include illness, death in the family, natural disaster, reliance on incorrect advice, etc. Provide supporting documentation if available.]
* Example: “I was hospitalized with a serious illness from [Start Date] to [End Date] and was unable to manage my financial affairs during that time. I have attached a copy of my hospital records as proof.”
* **First-Time Penalty Abatement:** [If you have a history of compliance and this is the first time you’ve incurred penalties, state this clearly.]
* Example: “I have consistently filed and paid my taxes on time for the past [Number] years. This is the first time I have ever incurred a penalty.”
* **Reliance on Incorrect IRS Advice:** [If you relied on written or oral advice from the IRS that turned out to be incorrect, provide details.]
* Example: “I contacted the IRS on [Date] and spoke with a representative who advised me [Describe the advice]. I relied on this advice when preparing my return. I have attached a copy of my notes from that conversation.”
I have taken steps to correct the issue by [Describe what you have done to resolve the tax issue, e.g., filed the return, paid the tax due].
I am requesting that you waive the penalties for the [Tax Year] tax year due to the circumstances outlined above. I am confident that I have demonstrated reasonable cause (or qualify for first-time penalty abatement, or relied on incorrect IRS advice).
Thank you for your time and consideration in this matter. I look forward to your response.
Sincerely,
[Your Signature]
[Your Typed Name]
html
How to Write Letter To IRS To Remove Penalties
Subject Line: Clarity is Key
The subject line is your first impression. Make it count. Be succinct and direct; ambiguity won’t serve you well.
- Use a clear and concise subject line like: “Penalty Abatement Request – [Your Name] – [Tax Year] – [Form Number]”
- Include your Social Security Number or Employer Identification Number for expeditious processing.
- Example: “Penalty Abatement Request – John Doe – 2022 – Form 1040”
Salutation: A Formal Overture
Address the IRS respectfully. While you might feel disgruntled, civility is paramount.
- Use “Dear Internal Revenue Service” or “To Whom It May Concern.” Avoid using a specific name unless you have a direct contact.
- Maintain a professional tone from the outset.
Introduction: Setting the Stage
Briefly introduce yourself and state the purpose of your letter. Be straightforward and avoid digressions.
- State your name, address, and taxpayer identification number (SSN or EIN).
- Clearly indicate that you are requesting a penalty abatement for a specific tax year and form.
- Example: “I am writing to request a penalty abatement for the late filing of my 2022 Form 1040. My taxpayer identification number is 123-45-6789.”
Body: The Heart of Your Plea
This is where you articulate your reason for requesting penalty abatement. Honesty and substantiation are your best allies.
- Explain the circumstances that led to the penalty. Be candid about what transpired.
- Provide a legitimate and IRS-recognized reason for penalty abatement, such as:
- Reasonable cause (e.g., illness, death in the family, unavoidable absence).
- First-time penalty abatement (if eligible).
- Reliance on incorrect advice from the IRS.
- Substantiate your claims with documentary evidence. Attach copies of relevant documents (medical records, death certificates, etc.). Do not send originals.
- Acknowledge the mistake and demonstrate that you have taken steps to rectify the situation.
Financial Information (If Applicable): Painting the Full Picture
If your request is based on financial hardship, provide a thorough overview of your financial situation.
- Outline your current income, expenses, assets, and liabilities.
- Explain how the penalty is causing significant financial hardship.
- Attach supporting documentation such as bank statements, pay stubs, and bills.
Conclusion: A Polite Entreaty
Reiterate your request and express your willingness to cooperate. End on a conciliatory note.
- Reiterate your request for penalty abatement.
- Express your willingness to provide any additional information or documentation.
- Thank the IRS for their time and consideration.
Closing: Formal Farewell
End your letter with a professional closing.
- Use a formal closing such as “Sincerely” or “Respectfully.”
- Sign your name.
- Print your name below your signature.
- Include your phone number and email address for easy contact.
html
Frequently Asked Questions: Requesting Penalty Abatement from the IRS
This section provides answers to common questions regarding the process of requesting penalty abatement from the Internal Revenue Service (IRS). Understanding these guidelines can significantly improve your chances of a successful penalty removal.
What is penalty abatement?
Penalty abatement is the process of requesting the IRS to remove or reduce penalties assessed for failure to comply with tax laws, such as failure to file or pay on time.
Under what circumstances might the IRS grant penalty abatement?
The IRS may grant penalty abatement for reasonable cause, which includes events beyond your control that prevented you from meeting your tax obligations. Examples include serious illness, death in the family, natural disasters, or reliance on incorrect advice from the IRS.
What information should I include in my penalty abatement request letter?
Your letter should include your name, Social Security number (or Employer Identification Number), the tax year in question, the specific penalties you are requesting to be abated, a detailed explanation of the circumstances that caused the failure, and any supporting documentation.
How should I send my penalty abatement request letter?
It is recommended to send your letter via certified mail with return receipt requested so that you have proof of delivery to the IRS.
What happens after I submit my penalty abatement request?
The IRS will review your request and supporting documentation. The process can take several weeks or months. You will receive a written notification from the IRS regarding their decision.