I hope you have managed to stay safe and well! We focus on resolving tax issues in Prince William County and throughout the lower Northern Virginia area.

The year of 2020 was a tough year for most taxpayers. Complicated by new relief provisions, both for tax professionals to interpret and advise clients on, and for the IRS to execute and enforce. However, there are some strategies available to taxpayers to relieve some of the burden, whether you already owe the IRS, or end up owing after the filing of your 2020 tax returns. One of these, is penalty abatement from the IRS.

It’s important to understand and refer to the IRS’s Internal Revenue Manual (IRM). This administrative handbook explains the procedures IRS employees should follow in the course of their work. Part 20 of the IRM discusses penalties and interest. Specifically, IRM Section 20.1.1.3 provides criteria for abatement like, reasonable cause, and statutory and regulatory exceptions.

The IRS in November announced a new program, the Taxpayer Relief Initiative, to help taxpayers who are unable to pay their taxes because of the pandemic (News Release IR-2020-248). Taxpayers who can’t pay their tax debt have always had options such as short-term extensions, installment agreements, and offers in compromise, but now they have more flexibility with these agreements.

The initiative also highlights reasonable-cause and first-time penalty abatement options to help with penalties. Some issues can be resolved over the phone with the IRS; other issues may require a straightforward letter to the IRS.

Fortunately, the IRS has now expanded the avenues by which taxpayers may defend against or seek abatement of tax penalties. Tax practitioners who understand how to conduct their clients along these routes to obtain penalty waivers will be performing a much-appreciated service. We would be happy to help you. Please feel free to contact us https://brtaxaccountant.com/