PENALTY ABATEMENT GRANTED ON REASONABLE CAUSE

2007-05-02 10:04:19

( Pharmeceutical-Medical )



Taxpayers can avail of penalty abatement from the IRS for debt on tax penalties. The IRS imposed tax penalties for non payment of taxes that automatically adds up to the principal amount of tax dues. These results to huge increase on tax debt face by delinquent taxpayers.

What is Penalty Abatement?

Penalty abatement for non-payment of taxes is a service extended by the IRS to give change to delinquent taxpayers to reduce their tax penalty debt. They are required to present admissible reasons whey they fall behind the payment of taxes along with their submission of penalty abatement request. The latter should comply with the existing IRS code and procedures in terms of wordings and phrasing.

Admissible Reasons for Penalty Abatement

Penalty abatement helps waive or reduce the amount of penalties imposed for non-payment of taxes once taxpayers proved that they have reasonable cause for delinquency. The IRS considers a list of acceptable reasons to grant penalty abatement. Natural calamities, bankruptcy, unemployment, serious medical condition, death of immediate family member, divorce and retirement are some of the reasons admissible to grant penalty abatement request. Taxpayer suffering from asbestos related diseases that prevents him from earning income can submit it as reason for penalty abatement request. These reasons must corroborate the inability of taxpayers to generate income to pay off their taxes.

Detailed Documentation

Taxpayers must also document that they have been industrious and consistent in their efforts to settle their delinquent tax obligations. Detailed documentation of such efforts is important to convince the IRS that they are faithful in their intentions to settle their delinquent taxes.

Every taxpayer has the right to request penalty abatement. However, granting it will solely rely on the admissibility of the reasons for delinquency as well as the quality of documentation submitted to the IRS.


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