IRS Abatement Penalty Letter
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What is an IRS abatement penalty letter?
An IRS Abatement Penalty Letter is a formal written request submitted to the Internal Revenue Service (IRS) to ask for the cancellation, waiver, or partial reduction of tax penalties.
The primary purpose of the sample IRS penalty abatement letter is to demonstrate that the taxpayer has a right to relief due to reasonable cause, a first-time error, or an revenue’s department error. While neither federal nor state law defines exact reasons that could be considered ‘reasonable,’ it may include financial hardship, medical problems, difficult family circumstances, unemployment, force majeure, etc.
This template represents a formal request to a territorial department of the IRS to cancel or decrease the assigned penalties. Moreover, you can use this letter to challenge various IRS penalties, including late fees, errors, etc.
What should be included in the sample letter to IRS to waive penalty?
An IRS abatement penalty letter is a simple and short document that must include:
Identification details of the sender
A tax officer who will consider your request does not know who you are or any of your identification details. If any important detail is missing, your request will be postponed in a long queue for better times. To avoid this mistake, make sure the text of a sample letter to IRS to waive penalty includes:
- full name and residential address of a taxpayer;
- taxpayer number;
- social security number/EIN;
- contact phone number and email address of a taxpayer;
- date of signing the letter; and
- taxpayer’s signature.
Reference to Penalty
Now, when a tax officer is capable of identifying who you are, they need a quick recap regarding what the initial penalty letter was about. Therefore, the text of IRS penalty abatement letter sample includes
- date of issuance of a penalty letter;
- reason for its issuance;
- amount of a penalty in U.S. dollars.
Waiver Request
In this last part of IRS penalty abatement letter sample, the taxpayers must include the following information:
- reasoning and explanation why a tax payer still did not pay or did not pay on time;
- request to cancel or reduce the penalty; and
- list of attached documents.
Why use this IRS abatement letter sample?
- First, all templates of our documents and letters are created by lawyers, not AI.
- Second, you save time by creating a customized document template in 2 minutes.
- Third, a well-drafted IR abatement letter template helps to avoid costly errors.
Finally, this IRS abatement penalty letter is not a one-time document, so you can use it an unlimited number of times in future disputes with the IRS.
How to customize an IRS abatement letter sample at FasterDraft?
To get a fully customized legal document template, follow a few steps given below:
- Click the “Create Document” button.
- Answer simple questions in the form.
- Select a template’s format—IRS Abatement Penalty Letter PDF or Word.
- Make a payment.
- E-sign online, download, and send the document to the territorial IRS department of your county.
Table of content
Frequently Asked Questions (FAQ)
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1. What is an IRS abatement penalty letter?
The IRS first-time penalty abatement letter is a type of legal notice that a taxpayer sends to the territorial department of the IRS requesting to cancel or reduce an assigned tax penalty.
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2. How do I request IRS penalty abatement?
The only method to do that is to send an IRS abatement penalty letter to the territorial department of the IRS that issued you a penalty notice.
The said letter could also be sent online on the web portal of the IRS. If the text of the IRS penalty notice includes contact details of the IRS officer who signed the notice, you can send your letter directly to him or her.
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3. Does this template work for first-time penalty abatement?
Yes, this template could be used as an IRS first-time penalty abatement letter.</p>
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4. What penalties can the IRS remove with an abatement request?
There is no specific list of penalties the IRS can or cannot remove as a result of a review of a submitted abatement request. It is the discretion of the IRS’s department.
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5. How do I write a reasonable cause explanation for the IRS?
To create a reasonable cause sample letter to IRS to waive penalty, include the key elements below:
- Describe the exact circumstances that caused a penalty (be honest and precise; avoid twisting facts).
- Attach any available supporting documents to prove your reasoning.
- Use formal wording for the IRS abatement penalty letter (avoid emotions).
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6. Can businesses use this IRS penalty waiver letter template?
Yes, this IRS abatement letter template is suitable for individuals, self-employed people, business owners, and organizations across the U.S. who wish to challenge an IRS penalty notice.
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7. How long does the IRS take to respond to an abatement request?
The IRS needs between 2 and 3 months to consider a first-time penalty abatement letter on average. If you’re submitting a second-time IRS abatement penalty letter sample, known as an appellation, it could sometimes take up to 9 months to get a final decision.
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8. What supporting documents should I attach?
The list of supporting documents widely depends on a case-by-case basis. The document number one every taxpayer must attach is the copy of an IRS initial penalty notice. Below we made a short list of document examples you can attach depending on the reasonable cause:
– illness (e.g., medical bills, medical reports, insurance confirmation, letter from a doctor confirming admission, etc.);
– financial hardship (e.g., letters from creditors, extracts from credit or debit cards confirming the card balance, unemployment status, etc.);
– natural disaster (e.g., photos, extracts from articles, or news reports).
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