Legacy Tax & Resolution Services, LLCPremier Tax Preparation and Resolution Services 480-907-6644
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Abatement of Penalties
Call us today for a FREE phone consultation to discuss how to abate your penalties- 480-907-6644
If you have ever been late for anything IRS then you have probably gotten a penalty and interest notice stating that you now owe much more than your original tax liability. We have actually seen cases where the penalties and interest on the principle tax liability was substantially more than the original tax assessed.
Are the Penalties and Interest Accurate?
There is just about a penalty for everything; failure to deposit, failure to pay, failure to file, estimated tax, return related penalties and on and on. One of the most important parts of our process is to be sure the IRS has calculated and assessed the penalties correctly. You will be surprised when a careful examination of penalties and interest is done, that you may have been charged incorrectly or assessed a penalty in error.
Before we discuss what to do in order to obtain forgiveness of penalties it should be noted that it is very rare for the IRS to forgive interest on your original tax liability unless it can be shown that you acted on faulty advices given by the IRS or they somehow delayed a managerial or ministerial act. But you will have to prove it.
The Penalties and Interest are correct now what?
Ordinary Business care and prudence
Your reason: Generally dates and explanations should correspond with events which penalties are based; there may be exceptions given additional information.
Compliance History: Do you have a pattern of non-compliance? If that is the case it may be hard to justify ordinary business care and prudence. That does automatically mean you did not have a reasonable cause or act with ordinary business care and prudence. It may be harder to prove. We takes the time to put together an abatement letter that has chance of being approved and negotiated in appeals if needed.
Time: What is the time frame between your reasonable cause of compliance failure and when you returned to being compliant?
What circumstances were beyond your control: Could you have anticipated the situations and events that caused your compliance failure? Did you try to get back on track and timely meet your tax obligations?
The IRS list many different reasons for reasonable cause, below are just a few. We will review your circumstances and help fashion an argument as to why the IRS should forgive your penalties.
This list is not an exhaustive list of reasonable causes. Remember for every cause that you list you must be able to show that you acted with ordinary business care and prudence