Hello, what are some of the reasons that the IRS may waive or reduce the penalty? The company already used a first time abatement some number of years ago.
Thank you!
The company already used a first time abatement some number of years ago.
makbo wrote:This won't be the response you want, but how will anyone take filing deadlines seriously if there aren't penalties? They've already gotten at least one free pass, so what else is it going to take to get them to learn? Are they children or something?
utsllc wrote:Hello, what are some of the reasons that the IRS may waive or reduce the penalty?
utsllc wrote:From my understanding the owner's son had some medical diagnosis that required hospitalization, emergency procedures, and so on between February and early April, which lead to missing some of the deadlines/etc.
1. Death, serious illness, or unavoidable absence of the taxpayer, or a death or serious illness in the taxpayer's immediate family, may establish reasonable cause for filing, paying, or depositing late for the following:a. Individual: If there was a death, serious illness, or unavoidable absence of the taxpayer or a death or serious illness in the taxpayer’s immediate family (i.e., spouse, sibling, parents, grandparents, children).
b. Corporation, estate, trust, etc.: If there was a death, serious illness, or other unavoidable absence of the taxpayer (person responsible), or a member of such taxpayer’s immediate family, and that taxpayer had sole authority to execute the return, make the deposit, or pay the tax. [emphasis in original]
utsllc wrote:Would a letter for this suffice and would the filer need to provide proof of the issue or just state that proof is available.
a. Taxpayer’s Reason: The taxpayer’s reason should address the penalty imposed. To show reasonable cause, the dates and explanations should clearly correspond with events on which the penalties are based. If the dates and explanations do not correspond to the events on which the penalties are based, request additional information from the taxpayer that may clarify the explanation.
utsllc wrote:Are any of these requests increasing chances of audits or further complications (meetings, etc.)? I assume no but have no experience with this.
In other words it'd be nice to save the $800 penalty (2 months x 2 shareholders) but not worth it if it complicates matters/etc.
What have been your experience(s) -- is this normally adjudicated via mail and IRS will allow or deny it?
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