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Adjust It: Abatement Of Irs Penalties And Interest

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Advertisements that tout abatement of IRS penalties and/or interest are greatly exaggerated and misleading but under certain limited situations are valid.  Only through meeting with an IRS resolution specialist who has expertise in both area can it be determined if you qualify.  

Here are some situations that are valid.

IRS PENALTIES

Abatement of IRS penalties requires proof of “reasonable cause.”  The most common are:

• Destruction of your records from fire, flood or some other civil disturbance

• Serious illness or injury 

• Death

• Unavoidable absence required by the government or a crime committed against you

• Inability to calculate the tax liability for reasons beyond your control

• Given and relied on incorrect information or advice from the IRS

• Possible other reasons that prevented you from filing or paying on time

IRS INTEREST

Interest abatement can be requested if the:

• IRS delayed processing the tax liability

• IRS error or loss of paperwork

The error cannot be an issue or event with the taxpayer.  Interest abatements with the IRS are rare because they are hard to prove.  IRS interest rates change each quarter.  If you want more information go to IRS interest rate.