Penalty Abatement

Abatement refers to eliminating an assessed tax liability and adjustment references reducing or altering an assessed tax liability. If there is a reasonable cause for abatement or adjustment, the IRS may be willing to review the penalties which created a tax liability. The IRS takes the position that a penalty should not be asserted if the taxpayer’s liability is as a result of reasonable cause, and not “willful neglect.” Some frequent definitions of reasonable cause include: death or illness in the taxpayer’s immediate family, unavoidable absence, destruction by natural causes of the taxpayer’s residence, the taxpayer cannot reasonably obtain the records for liability determination, the non-filing was due to IRS error, failure by the US Post Office, failure by a competent tax advisor, civil disturbance, and others.