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By Michael S. Anderson of Anderson Tax Law logo for Arizona tax attorney Michael S. Anderson P.C.
  • IRS Penalty Abatement

    IRS Penalty Abatement

    The IRS has an extensive list of penalties they can assess against you. Over 140 potential penalties are on the books. Congress has created these penalties to encourage  compliance and fast payment.

    These tax penalties are considered by some a national burden that actually impedes tax collection as they often cause the amount owing the IRS to become so unmanageable that the potential taxpayer will seek other ways to avoid paying it, including working under the table  and filing for bankruptcy.

    Fortunately, the law does require the IRS to consider forgiving or abating  the penalties that have been assessed by if certain requirements can be met. Generally, the taxpayer must prove that a reasonable cause  or good reason exists that caused the action that was penalized in order for it to be abated.

    What is or is not a good reason depends often on the unique and individual circumstances that existed when the taxpayer didn\’t pay the tax, file the return or did whatever other action that caused the penalty.

    If the penalty is abated, the interest that has accrued with the penalty amount will be abated as well.

    A good penalty abatement case typically requires that the taxpayer be thoroughly interviewed by an experienced Mesa tax attorney. The attorney will then compose a document based on the taxpayer\’s facts, proof and any legal precedent (past court cases) that would strengthen the taxpayer\’s position.

    The IRS does not like to grant penalty abatement requests of course, even those that are well reasoned, and therefore an appeal of the initial decision is common.

    If you have a serious penalty, you should strongly consider discussing your situation with experienced tax counsel. You can call our Mesa tax office and discuss your situation with us for free.