The IRS has charged me penalties and interest. Can I get them removed?

The answer is maybe, yes or no and - t depends.


The Maybe. Generally, penalties can be removed if you prove to the IRS that there was "reasonable cause abatement", a term that is defined in the tax law. Reasonable cause, in non-technical terms, means the required actions (prepaying taxes, filing on time, paying on time) weren't taken because of circumstances beyond your control. These circumstances do not include financial problems.

The penalties are for underpayment of estimated tax, filing late and paying late.

The procedure is to make the request in writing explaining the exact circumstances that affect your ability to comply for each type of penalty for each year. This can be tedious if you have several types of penalties for several years. Sometimes it can be best to send a separate letter for each year. In addition,must provide proof of the circumstances.

Getting an answer to these requests will take long time and you may not get the same answer for the same penalties for each year even though the cirumstances are the same. If that happens you will have the opportunity to appeal.

The Yes. Three types of penalties can be removed without your having to prove anything. They are the penalties for not prepaying enough tax, filing your return late and paying your tax late. The requirement is that you have not had the same penalty in any of the most recent 3 years, the IRS will remove the current one. The easiest way to get this  done is to call the IRS and ask for First Time Abatement (FTA). Writing a letter for an FTA will take a very long time to get your result.


The No. The law does not permit the IRS to remove interest. Note that interest is charged on unpaid penalties, so if penalties are removed the related interest is also removed.