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Getting penalties forgiven by the IRS

Posted by attorney Julie Camden

If you did not pay taxes, penalties and interest will compound with the IRS. Thus the debt will increase from the original balance. In order for a taxpayer to remove penalties and interest, the taxpayer must have reasonable cause specific to each tax year. Below are the six main reasons the IRS will abate penalties: 1. The death or serious illness of the taxpayer or an immediate family member, or a companies' individual who had sole authority to execute the return or make a deposit or payment. 2. An unavoidable absence of the taxpayer or an individual having the sole authority to execute returns or make deposits or payments. 3. The taxpayer's business records are destructed by a fire or another casualty. 4. The taxpayer could not determine the amount of deposit or the tax due for reasons beyond his control, and the taxpayer was unable to have access to his own records. 5. Facts indicating the taxpayer lacked the ability to make federal deposits or payments due to a material impairment by civil disturbances. 6. The taxpayer demonstrates he exercised ordinary business care and prudence but lacked the funds to pay.

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