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title: IRS Penalty Abatement Letter Requirements

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# IRS Penalty Abatement Letter Requirements

In regards to fixing their IRS problem, one of the very most common things people want can be an abatement of these penalties and interest.

I want in the first place two precautions worth pointing out.

To start with, note there are no provisions within the law for the removal of interest charges unless these were accrued as you got bad advice from an IRS employee, which will be extremely rare and very difficult to prove (write down everything when you talk to the IRS, in addition!). If a salesman at a tax resolution firm is letting you know that they may get interest charges abated, run away quickly, because you're speaking with somebody that's either outright lying for you or can be an idiot.
![](https://i.imgur.com/acfBw7t.jpg)


Second, remember that penalty abatements aren't automatic. If you're being guaranteed by a company that they may get a certain amount of one's penalties removed, you're also being lied to. Again, there's NO GUARANTEE that the IRS will EVER grant a penalty abatement.

With those two points in mind, let's consider your penalty abatement application. In order to get penalties abated, you have to demonstrate two significant things:

1). Despite exercising "ordinary business care and prudence", you're still unable to generally meet your tax obligations.

2). Your reason behind not to be able to pay your taxes on time falls under one of many IRS "reasonable cause criteria" ;.

When submitting a penalty abatement application, while there is no form, you're basically just writing a letter. This letter needs to handle both of the items above. It's basically an explanation, with timelines, people involved, and any and all documentation offered to prove your case. In fact, it's not really a carefully crafted letter -- it's an entire package of "stuff" ;.
![](https://i.imgur.com/kzZKUAM.jpg)

The demonstration of "ordinary business care and prudence" is very important. In a nutshell, you have to demonstrate that you did everything in your power to obtain the taxes paid, but as a result of circumstances entirely away from control, it simply wasn't possible. The one thing to remember regarding this standard is that the people reviewing your application at the IRS have almost certainly never operated a business [Last Will and Testament Johns Creek GA](https://www.jimclinelaw.com/) within their entire lives. In fact, a lot of them are lifelong civil servants, and have little, if any, actual grounding in what "ordinary business care and prudence" entails in the true world. Therefore, your explanation should be written in very simplistic, clear to see terms, and actually outright explain what's customary for your type of business or a family group in your area.

For instance, if you should be applying for an abatement of penalties for failure to cover personal income tax, you need to explain that the typical family of four, the same as yours, in your hometown lives using size and value of homes and drives certain types and values of cars, and that the lifestyle is therefore "ordinary and prudent" for your area and income, rather than lavish in comparison.

Only for the record, this doesn't mean that higher income individuals that live more lavish lifestyles can't get penalty abatements, however it is definitely far more difficult, and something you ought to seek professional assistance with, rather than trying to complete on your own.

Ensure the tax resolution specialist has plenty of experience practicing before the IRS. Simply because someone is really a CPA, Attorney or EA doesn't automatically mean they know what they are doing. Ensure that your professional has at the very least five years of experience helping folks solve their tax problems. The reason why I say five years is that it's said it will take someone 10,000 hours to master a trade. Assuming you work 2,000 per year in your trade which means it would take a tax professional five years to master the trade of tax resolution and IRS tax help. Five years is really a bare minimum. I would choose 8 or maybe more years of experience in IRS representation - five is really a bare minimum. You would like a classic crusty professional to give you tax resolution services - not someone freshly out of school.
