How To Request IRS Penalty Abatement

You're looking at your IRS notice and the numbers don't add up. The tax itself is one thing, but there's an extra charge—sometimes hundreds or thousands of dollars—labeled as a penalty. Maybe you filed late. Maybe you couldn't pay on time. Maybe the IRS says you underreported your income.

Here's what most people don't realize: the IRS abates millions of penalties every year. There's a formal process to ask for penalty relief, and you don't need a tax professional to do it. In many cases, a single phone call is enough.

This guide walks you through the two main paths to penalty relief—First Time Abate and reasonable cause—and explains what to do if the IRS says no.

Which Penalties Can Be Abated?

Three types of IRS penalties are most commonly eligible for abatement. Here's what each one looks like:

Notice the difference in rates: the failure-to-file penalty runs at ten times the failure-to-pay rate. If you can't pay your full balance, file the return on time anyway. That alone saves you 4.5% per month in combined penalties.

The overlap rule. When both FTF and FTP penalties apply in the same month, IRC § 6651(c)(1) reduces the FTF rate by the FTP rate. The net effect during the overlap period is 4.5% FTF plus 0.5% FTP per month. Once the FTF penalty maxes out after five months, only the FTP penalty continues accruing at 0.5% per month.

What about estimated tax penalties? The penalty for underpaying estimated taxes under IRC § 6654 is different. It has only a narrow statutory waiver—for casualty, disaster, or other unusual circumstances, or retirement after age 62 or disability—and is not eligible for First Time Abate or standard reasonable cause relief. This guide does not cover it.

Two Ways To Get Penalties Waived

The IRS grants penalty relief through two main channels: an administrative waiver called First Time Abate, and a facts-based defense called reasonable cause. They work differently, and understanding which one applies to you is the first step.

First Time Abate (FTA)

First Time Abate is the easier path. It's an administrative waiver—not a right written into the tax code, but an internal IRS policy created in 2001 and documented in IRM 20.1.1.3.3.2.1. It removes penalties based solely on your compliance history, with no explanation or documentation required from you.

FTA applies to:

• Failure-to-file penalties
• Failure-to-pay penalties

FTA does not apply to:

• Accuracy-related penalties under IRC § 6662
• Estimated tax penalties under IRC § 6654

Three requirements must all be met:

1. Filing history. You filed the same type of return (or a valid extension) for the three tax years before the penalized year.
2. No prior penalties. You had no unreversed penalties on the same return type during those three prior years. A penalty that was assessed and later fully reversed does not count against you.
3. Current compliance. All currently required returns are filed (or on valid extension), and any balance due is either paid or in an approved payment arrangement.

If you meet all three, the IRS removes the penalty. That's it—no narrative, no supporting documents, no explanation of what went wrong. The IRS checks its own records to verify your compliance history.

One important limitation: FTA covers penalties that have already accrued. It does not prevent new failure-to-pay penalties from continuing to accrue if you still owe the underlying tax. Resolving the balance—through full payment or an installment agreement—stops the penalty clock.

Reasonable Cause

When FTA doesn't apply—because you have prior penalties, because the penalty is accuracy-related, or because you don't meet the compliance requirements—reasonable cause is the alternative.

The standard comes from Treas. Reg. § 301.6651-1(c): you must show that you "exercised ordinary business care and prudence" but were still unable to comply because of circumstances beyond your control.

This is a narrative defense. You're telling the IRS what happened, why it prevented you from filing or paying on time, and what you did to fix the situation once you could.

The five questions the IRS uses to evaluate your explanation (from IRM 20.1.1.3.2.2):

1. What happened, and when? Describe the specific event or circumstance.
2. What prevented you from complying? Identify the facts that made it impossible or impractical to file or pay on time.
3. How did those facts cause the noncompliance? Draw the connection. A medical emergency that left you hospitalized during the filing deadline is a clear causal link. A vague reference to "financial difficulties" is not.
4. How did you handle your other obligations? The IRS wants to know whether you were truly incapacitated or selectively noncompliant. If you managed every other financial obligation except your taxes, that weakens the argument.
5. What did you do once the situation improved? Prompt remedial action—filing or paying as soon as you were able—strengthens your case significantly.

Circumstances the IRS recognizes as valid:

• Fire, natural disaster, or civil disturbance
• Serious illness, hospitalization, or death of the taxpayer or an immediate family member
• Inability to obtain necessary records
• IRS system issues that delayed electronic filing or payment

Circumstances that generally do not qualify:

• Lack of knowledge of the filing requirement
• Simple mistakes or oversights
• Insufficient funds alone (though inability to pay combined with other factors—such as medical expenses—can help)

The Boyle Doctrine: A Critical Warning

If you hired someone to prepare your taxes and they simply didn't file on time, you might assume that excuses you from the late-filing penalty. It doesn't.

In United States v. Boyle, 469 U.S. 241 (1985), the Supreme Court drew a firm line. The duty to file a tax return on time is nondelegable. Filing deadlines are fixed dates that "require no special training or effort" to meet. When a taxpayer hands off the act of filing to an agent and the agent drops the ball, the taxpayer bears the penalty.

The distinction matters:

• Relying on a professional's advice about the law—for example, an accountant told you that you didn't need to file—can be reasonable cause.
• Relying on a professional to perform the act of filing—and they didn't do it—is not reasonable cause.

This catches many people off guard, especially those who paid a preparer and assumed the job was done. If this happened to you, the penalty for late filing likely stands under Boyle. But the reasonable cause analysis still applies to other penalties, and FTA may still be available if you meet the compliance requirements.

Defending Against Accuracy Penalties

Accuracy-related penalties under IRC § 6662 are triggered when the IRS determines that your return contained a substantial understatement of income, negligent reporting, or a valuation misstatement. These penalties often arise during an audit—see How To Respond to an IRS Audit for how the examination process works. The penalty is 20% of the underpayment amount.

The defense is found in IRC § 6664(c)(1): no accuracy penalty applies if you can demonstrate reasonable cause for the underpayment and that you acted in good faith.

Treas. Reg. § 1.6664-4 says the most important factor is "the extent of the taxpayer's effort to assess the taxpayer's proper tax liability." The IRS also considers your education and experience, whether there was an honest misunderstanding of fact or law, and whether errors were isolated computational mistakes.

Reliance on professional advice can support this defense if three conditions are met—a framework the Tax Court established in Neonatology Associates, P.A. v. Commissioner, 115 T.C. 43 (2000):

1. The advisor was a competent professional with relevant expertise.
2. You provided the advisor with all necessary and accurate information.
3. You actually relied on the advice in preparing the return.

Reliance on information returns (W-2s, 1099s) can also establish reasonable cause. If you reported income based on a form that turned out to be incorrect, and you had no reason to know it was wrong, that weighs in your favor under Treas. Reg. § 1.6664-4(b).

How To Request Abatement

FTA by Phone

For most individual taxpayers, a phone call is the fastest way to request First Time Abate. Call the number on your IRS notice, or use the general line at 800-829-1040.

What to have ready:

• Your Social Security number
• The notice or letter number (in the upper right corner of the IRS correspondence)
• The tax year and return type the penalty applies to

What to say: You don't need to use the phrase "First Time Abate" or cite the IRM. Simply tell the representative you're requesting penalty relief based on your compliance history. The representative can check your account and often grant the abatement during the call.

After the call: Write down the representative's name (or employee ID), the date and time you called, and what was agreed. If the penalty is removed, you should see an adjusted balance on your account within a few weeks.

Written Request via Form 843

When a phone call isn't appropriate—because you need to make a reasonable cause argument, because you've already been denied by phone, or because you're requesting a refund of penalties you've already paid—submit Form 843, Claim for Refund and Request for Abatement.

Key fields:

• Line 5a: Type of tax (income, employment, etc.)
• Line 5b: Type of penalty
• Line 7: Your explanation. For FTA requests, state that you are requesting administrative penalty relief based on your compliance history. For reasonable cause, this is where you provide your narrative addressing the five IRM elements described above.

For reasonable cause requests, attach supporting documentation: medical records, insurance claims, death certificates, FEMA disaster declarations, correspondence showing your attempts to comply—anything that corroborates your narrative.

Where to mail it: The Form 843 instructions include a table listing the IRS service center address based on your state. Mail it to the address that corresponds to where you filed the underlying return.

Your written statement must include a declaration made under penalties of perjury, as required by Treas. Reg. § 301.6651-1(c)(1). Form 843 includes the perjury declaration on the form itself—just make sure you sign and date it.

If the IRS Says No

A denial is not the end of the road. There are three escalation paths.

Appeal to the IRS Independent Office of Appeals

If your written abatement request is denied, the denial letter will outline your right to appeal. You generally have 30 days from the date of the denial letter to request an appeal.

For penalties totaling $25,000 or less for any given tax period, a brief written statement or a completed Form 12203 (Request for Appeals Review) is sufficient. For amounts above $25,000, a formal written protest is required.

The Appeals officer who reviews your case is independent of the unit that denied your request. Appeals considers the "hazards of litigation"—the likelihood the IRS would win if the case went to court—which can work in your favor if you have a reasonable argument.

For more on the Appeals process, see How To Request an IRS Appeals Conference and Publication 4576, Orientation to the Penalty Appeals Process.

Challenge the Penalty in Tax Court

If the penalty was proposed as part of a deficiency—for example, an accuracy penalty included in a Notice of Deficiency—you can challenge it by filing a Tax Court petition within the 90 days deadline. The filing fee is $60.

An important protection: under IRC § 7491(c), the IRS bears the initial burden of production for penalties in Tax Court. This means the IRS must first present evidence sufficient to justify imposing the penalty—proving that the return was late, the tax was unpaid, or the understatement was substantial—before the burden shifts to you to establish any affirmative defense like reasonable cause.

If you missed the 90 days deadline, the Tax Court path for deficiency-related penalties is generally closed.

Pay and Sue for a Refund

If the penalty has already been assessed and paid, you can file a refund claim using Form 843. If the IRS denies the claim (or doesn't respond within six months), you can sue for a refund in U.S. District Court or the Court of Federal Claims.

This path requires paying the full penalty amount first—a rule known as the Flora full-payment requirement. For most taxpayers facing financial difficulty, this makes the refund litigation route impractical. The administrative request and Appeals process described above are far more accessible.

Common Mistakes To Avoid

Blaming your tax preparer for a late filing. Under Boyle, this is not reasonable cause. If your preparer failed to file, the penalty sticks. Focus your argument on other grounds—or check whether FTA applies.

Writing a vague reasonable cause letter. "I had a hard year" is not enough. The IRS evaluates your request against the five narrative elements in the IRM. Be specific: dates, medical records, correspondence, concrete facts that show you tried to comply.

Waiting until the IRS starts collection action. Penalties continue to accrue interest. The sooner you request abatement, the less you owe. If penalties have already been referred to collections, you still have options—including raising penalty issues in a collection due process hearing under certain circumstances.

Not checking the IRS's math. Before you request abatement, review the penalty calculation on your notice. Make sure the IRS applied the correct penalty rate, used the right filing date, and calculated accrual correctly. You can request your account transcript to verify the details.

Sending one letter for multiple tax years. Each tax year is a separate penalty determination. If you owe penalties for 2021, 2022, and 2023, address each year individually—either on separate Forms 843 or with a clear year-by-year breakdown in your narrative. The facts supporting reasonable cause may differ from year to year.

Get Help

If the penalty amount is significant or your situation is complicated, you don't have to do this alone.

Low Income Taxpayer Clinics (LITCs) provide free representation to taxpayers whose income falls below 250% of the poverty line and whose dispute is under $50,000 per tax year. LITCs routinely handle penalty abatement requests and can represent you before the IRS, at Appeals, and in Tax Court. See How To Find and Use a Low Income Taxpayer Clinic for details on how to locate one.

The Taxpayer Advocate Service (TAS) is an independent organization within the IRS that helps taxpayers resolve problems. TAS can intervene when the penalty process is creating a financial hardship. Contact them at taxpayeradvocate.irs.gov or by calling 877-777-4778.

Resources

• Form 843, Claim for Refund and Request for Abatement—the standard form for written penalty abatement requests
• Form 843 PDF (Rev. December 2024)—downloadable form
• Form 843 Instructions—includes mailing address table by state
• IRS Penalty Relief Overview—main IRS page on all types of penalty relief
• IRS First Time Abate Page—detailed eligibility and requirements
• IRS Reasonable Cause Page—guidance on what qualifies
• IRM 20.1.1 — Introduction and Penalty Relief—the IRS manual section governing penalty relief decisions
• IRC § 6651 — Failure to File/Pay Penalties
• IRC § 6662 — Accuracy-Related Penalties
• IRC § 6664 — Reasonable Cause Exception
• IRC § 7491 — Burden of Proof
• Form 12203, Request for Appeals Review—for appealing a penalty denial under $25,000
• Publication 4576, Orientation to the Penalty Appeals Process
• IRS Get Transcript—verify penalty calculations on your account
• You Just Got a 90-Day Letter From the IRS
• How To File Your Tax Court Petition
• You Missed the 90-Day Deadline. Now What?
• What Happens After IRS Appeals Denies Your Case
• Collection Due Process Hearings
• How To Find and Use a Low Income Taxpayer Clinic

This article is for informational purposes only and does not constitute legal or tax advice. For advice specific to your situation, consult a qualified tax professional or attorney.