If you need to IRS Penalty Relief Written Request, write a letter to the IRS requesting a penalty abatement, or fill out Form 843. Send the request, a copy of your penalty notice and any documentation that supports your request to the address provided in the IRS notice that you received. Please indicate whether you are requesting ‘Reasonable Cause’ or ‘First-Time Abatement (FTA)‘.

Important Sections of Your IRS Penalty Relief Written Request

A written request to the IRS to eliminate or lessen a penalty is referred to as a penalty relief written request. Sent via letter, a written statement or IRS Form 843, depending on the circumstances.

Typically, a written request will contain your taxpayer information, tax year or tax period, the IRS notice number, the type of penalty, the penalty amount, why you think relief should be considered and supporting documents.

This is NOT just a call to the IRS. A phone request might be OK for some simple relief for penalties, but a written request might be more appropriate if the IRS requires facts, timelines, proof or a formal explanation. To learn more about IRS Tax Penalty Relief, check out our Complete Guide to IRS Tax Penalty Relief.

When Should You Send a Written Request for IRS Penalty Relief?

In the perspective of Advocate Shahid (Tax Compliance and Advisory Specialist). A written request should be considered if your penalty has been issued and needs further explanation that can’t be done over the phone. This is particularly true when seeking reasonable cause relief, or responding to an IRS notice.

The IRS Cannot Approve Relief by Phone

There is the option to deal with some of the requests for penalty relief by phone. If, however, the IRS agent refuses to grant the request, requests documentation or states the case requires further review, you may want to seek IRS penalty relief via written request.

When you give an explanation in writing, you have greater control over the explanation. The facts may be arranged in a certain order, evidence may be attached and the nature of the type of relief from the penalty can be clearly stated.

You Need to Explain Reasonable Cause

When requesting reasonable cause penalty relief it is helpful to submit a written request. Reasonable cause is typically defined as having had a good reason for not filing, paying or depositing on time even though you tried.

Common reasonable cause situations include serious illness, death in the family, natural disaster, fire, casualty loss, unavailable records, unavoidable absence and a few situations involving inaccurate written advice.

An Internal Revenue Service (IRS) reasonable cause penalty abatement letter needs to be factual, specific and supported with documents. Steer clear of emotional semantics, without evidence. The IRS wishes to understand what occurred, when, the impact on your compliance and what you did to fix the issue.

You Already Paid the Penalty and Want a Refund

If the penalty has been paid you may need to ask for a refund or an abatement. This can sometimes be through a Form 843 Penalty Abatement Request.

Because it’s not necessarily the same to ask the IRS to remove an unpaid penalty as to ask the IRS to remove a penalty that you already paid.

You Received an IRS Notice

If a notice has been issued, put your written request in reply to the notice. Provide notice number, tax year/tax period, type of penalty, the amount of the penalty, and the deadline to respond.

A written request is particularly useful in getting IRS penalty relief after notice as it provides a record of your response.

Types of Penalty Relief You Can Request in Writing

You will have to select the proper penalty relief reason before writing your request. If it’s done incorrectly, it can result in a delay or denial.

First Time Abate Written Request

If you have had a good compliance history with the IRS, you may need a written request from the IRS that you are a First Time Abate. The failure to file, failure to pay or failure to deposit penalties are another common use for First Time Abate.

Generally, no hardship document will be required when this request is made. Instead, it’s about how you’ve behaved in the past with regard to the tax filing process. The explanation should indicate that you filed required returns, there were no disqualifying penalties in the past and that you addressed the current issue.

Before submitting your penalty relief request, if you are not sure you meet the criteria, check the Requirements for IRS Penalty Relief.

Reasonable Cause Written Request

A reasonable cause request is not like that. This written request should give the reasons you were unable to comply with the reporting requirement, despite being responsible.

If you are in the hospital prior to the filing date, include ward dates, if it was a hindrance for you to file or pay the taxes, when you recovered and when you corrected the tax problem in your letter.

This is where it’s useful to have supporting documents. A reasonable cause relief letter without supporting records is not as strong as a reasonable cause relief letter with supporting records.

Statutory Exception or IRS Error

There may be a statutory exception or error by the IRS that will allow some penalties to be abated. If the IRS imposed a penalty for erroneous account details, for instance, then you ought to let them know of the error and submit records of the facts.

This kind of IRS penalty waiver letter must be succinct. Identify the error made by the IRS, complete the correct information and include evidence.

Which IRS Penalties Can Be Addressed in a Written Request?

Several categories of IRS penalties have a written request for penalty abatement option, but each of these situations should be taken care of carefully.

IRS Late Filing Penalty Abatement Letter

A letter from the IRS acknowledging late filing penalty abatement is issued when a person filed a late return for a required return. Write an explanation in your letter of why you returned the book late and why the book should be penalized.

If a fire destroyed your records and you were going to have to work for a while, for example, to put them back together again, tell the story and include any documentation including insurance records, bank and accountant correspondence, fire reports, etc.

IRS Late Payment Penalty Abatement Letter

A late payment penalty abatement letter is issued when you have filed the tax return, but not paid the tax in time. Your letter should include an explanation of why the payment was late and if you have paid, the payment plan or if you have done something to pay off the debt.

Although some penalties may be waived, it is possible for the IRS to still impose interest on the unpaid tax. That’s why it’s important to tackle both the penalty and the balance of the tax debt.

IRS Failure to Deposit Penalty Abatement Letter

Most often, the IRS failure to deposit penalty abatement letter is related to businesses that failed to pay their payroll taxes or employment taxes. Payroll records, EFTPS confirmations, bank records and accounting information within the company or internal accounting records may be required for these requests.

Business penalty matters may become more complicated as the IRS may take into account former compliance and deposit patterns.

Other Penalties

There are exceptions to some of the penalties. Some of the penalties may not be eligible for the same relief, such as for estimated tax penalties, accuracy-related penalties and some information return penalties. When you receive an IRS notice, check to see what the type of penalty is before writing.

IRS Penalty Relief Written Request vs. Form 843

• This letter is similar to, but not identical with, a written letter and Form 843.
• Use a written letter when you have facts to explain; when responding to a notice; or supporting a reasonable cause argument. Form 843 is a formal IRS form for certain requests for refunds or abatement of penalties, interest, fees or certain taxes.
• Many taxpayers have more than one! They fill out the IRS penalty abatement Form 843 and include a letter with supporting documentation explaining why the IRS should waive penalties.
• Use Form 843 carefully. It is not the right tax form for all tax questions and it’s not an income tax return amendment. If you are in response to an IRS notice, follow the instructions on the IRS notice.

What to Include in an IRS Penalty Relief Letter

When you submit a request for IRS penalty relief letter content, you’ll be more effective and your request would be more easily reviewed by the IRS if you know what to include.

Your letter should contain the following information:

• Your full legal name
• Social Security number, ITIN, or EIN
• Current mailing address
• Phone number
• Tax year or tax period
• IRS notice number
• Type of penalty
• Penalty amount
• Date of IRS notice
• A clear request for penalty relief
• The type of relief requested
• A factual explanation of what happened
• A timeline of important events
• A statement that the issue has been corrected
• Supporting documents
• Your signature and date

Documents for IRS Penalty Abatement Request

The appropriate documents required are based on the reason for relief. Never glue any random papers onto. Include documents that contain evidence for the facts in your letter and Include hospital records, doctor letters, treatment dates or medical bills for illness or medical problems. Include a death certificate, funeral records and brief description of family relationship when a death occurs in the family.

<p>In the case of a natural disaster or fire, bring records from FEMA, insurance company, photographs of the damage, police reports or fire reports. Include bank letters, letters from accountants, data recovery records or evidence that you made every effort to obtain replacement records for missing records.

In the case of payment problems, attach bank statements, payment confirmations, installment agreements or IRS account statements. If you are looking for business penalty information, add to the above list payroll records, EFTPS confirmations, deposit history and accounting records.

IRS Penalty Relief Request Letter Sample Structure

1. Taxpayer name and address
2. Date
3. IRS address from the notice
4. Taxpayer identification details
5. Notice number and tax period
6. Penalty being challenged
7. Relief requested
8. Explanation of facts
9. Corrective action taken
10. List of attached documents
11. Closing statement
12. Signature

The following is an example of an opening to a sample.

Enclose copies of the documents to support your case for abatement of the penalty assessed for tax year [YEAR] and I believe that such abatement is warranted because [brief reason]. I have corrected the problem and attached copies of the necessary documents for your consideration.

Example: Written Request for Reasonable Cause

Assume that a taxpayer was hospitalized two weeks prior to the filing deadline and was not able to file his return on time. The taxpayer recovered and then filed the return and made the necessary payment.

The written request should include the medical history, why the return could not be filed on time and when the taxpayer recovered and filed the return. Attach hospital records, or doctor’s letter.

This is a much more powerful statement than “I was sick.

Example: Written Request for First Time Abate

Imagine that a taxpayer has been filing and paying tax bills on time for three years and in that time experienced a lapse in their paperwork, resulting in one tax Bill being filed and paid one year late. If the taxpayer has a clean compliance record he/she can ask for First Time Abate.

The written request may be brief and to the point. It should make the taxpayer aware that he or she is requesting a First Time Abate and that he or she has filed required returns, has no disqualifying prior penalties and has corrected the issue.

Where to Send an IRS Penalty Relief Written Request

Many taxpayers have the question of where to send penalty abatement requests to the IRS. If it is the long-term care facilities, send to the address listed on the IRS notice. If you are using Form 843 follow the instructions in the form.

Never type in the IRS address in your guess. Oftentimes, various notices and tax matters will be sent to various IRS offices. Make a copy of what you send and use certified mail or another method of tracking your mailings.

Can You Fax an IRS Penalty Abatement Request?

When filing penalty abatement request documents with the IRS, sometimes taxpayers ask, can I fax these documents? This will vary based on the notice, department or instructions from IRS.

Don’t send documents by fax if the notice does not offer a fax number, or if an IRS representative instructs you not to fax the documents. If not, heed the directions to mail as indicated on the notice or on the form.

Before sending a complete written package, check out our IRS Penalty Relief by Phone Request guide for situations where it may be possible to resolve your issue quicker by phone.

What Happens After You Send the Written Request?

The IRS will review the request, and either approve, reject, or request additional information. The processing time depends on the type of penalty, the workload of the IRS and if your request is complete.

Many people who are facing fines from the IRS ask themselves, how long does IRS penalty abatement take? No one time line. A few cases may be resolved in a shorter time than others and written reasonable cause requests may take longer.

If there is any tax remaining to be paid, continue to pay the tax or continue payment plan until this request is processed. Penalties and interest can be due until the IRS makes a adjustment or the debt is settled.

IRS Penalty Abatement Denied: What Next?

If your request is rejected, be sure to read the IRS denial letter. This letter may include an explanation of the reason for the denial, such as missing documents, the type of penalty, not eligible or lack of reasonable cause.

When the letter does contain appeal rights, be sure to note the appeal deadline. You might be able to provide further proof, expand your explanation or seek some alternative form of relief.

For a significant penalty, it might be beneficial to seek professional assistance. Any prospective savings needs to be compared with Tax Advisor Cost & Fees before hiring anyone to determine if representation is financially worth your while.

Common Mistakes to Avoid in a Written Request

Avoid these mistakes when preparing your written request:

1. Forgetting to include the notice number
2. Not identifying the exact penalty
3. Mailing the request to the wrong IRS address
4. Writing a vague explanation
5. Asking for relief without proof
6. Using emotional language instead of facts
7. Forgetting to sign the request
8. Requesting the wrong type of relief
9. Ignoring later IRS notices
10. Assuming the penalty will stop growing automatically

Professional Tips for a Stronger IRS Penalty Relief Written Request

Give your letter a succinct but complete presentation. Make use of dates, facts and documents. For each big claim provide evidence. If there is something wrong with the IRS, don’t blame them, unless there is clear evidence of an IRS error.

Describe the change, so that the problem will not occur again. Attach COPIES, NOT ORIGINALS. Be sure to retain proof of mailing. Wait and continue to respond to IRS notices.

Consider having the case professionally reviewed prior to the next response if the case has a high penalty, business payroll tax, more than one year, or the request had been denied.

FAQs About IRS Penalty Relief Written Requests

What is an IRS penalty relief written request?

A request to the IRS to remove or lessen a penalty, whether it be in the form of a letter, statement or Form 843.

When should I send a written request for IRS penalty relief?

Send one when: Phone relief is not approved; Documents are required; Reasonable cause is necessary and must be explained; or responding to IRS notice.

Do I need Form 843 for an IRS penalty abatement request?

Not always. There are a few requests that can be made by letter or phone. Some refund and/or abatement requests may require the Form 843.

Can I request penalty relief without Form 843?

Yes. In some instances, you may ask for some type of relief through a telephone call or written request. Fill out Form 843 if applicable or if required by instructions of the IRS.

What should I include in an IRS penalty relief letter?

Enter your Name, Taxpayer ID, Notice Number, Tax Period, Penalty Type, Penalty Total, Penalty Description, Request for Relief, Supporting Documentation, Signature and Date.

Can I request IRS penalty relief in writing after receiving a notice?

Yes. Follow the directions on the notice and provide the appropriate penalty information and paperwork.

Where do I mail an IRS penalty abatement letter?

Typically, send it to the address indicated on the notice from the IRS. If filling out Form 843, adhere to the directions on the form.

Can I fax an IRS penalty relief written request?

Sometimes. Do not send by fax unless the notice specifies the fax number or IRS requests that you send documents by fax.

How long does IRS penalty abatement take?

Processing times vary. The IRS may approve, deny or request further documentation.

What if my written request is denied?

Discuss the denial reason, review appeal rights, collect more evidence and consider other relief options like First Time Abate or reasonable cause.

Conclusion

A written request by the IRS for a relief from penalty may be helpful in communicating with the IRS regarding situations when penalty may be waived, particularly those where a penalty may not be waived by phone. Strongest requests are organized, fact based and evidence based.

Please read the IRS notice carefully before submitting your request, verify what the penalty is, select the appropriate reason for relief and make sure to retain copies of all items that are submitted. A well-crafted request provides the IRS with a solid basis to consider granting penalty relief, and can help prevent needless delays.