Fort Lauderdale IRS Penalty Abatement Lawyer Helping Clients Seek Abatement of Their Penalties in Florida
It can happen to anyone – even though you always file your taxes on time, this time, life got in the way, and you could not file due to circumstances beyond your control. But will the IRS hit you with penalties and interest anyway? Learn under what circumstances you can attain penalty abatement from the IRS and how a Tax Attorney in Fort Lauderdale may be able to help.
What Kind of Penalties Are Eligible for Abatement?
There are a number of penalties that may be eligible for abatement by the IRS. Those include:
- Information Return: applicable for taxpayers who don’t file information returns or provide payee statements on time.
- Failure to file: a penalty that applies when a taxpayer doesn’t file their returns on time.
- Failure to pay: when a taxpayer does not pay the taxes they owe by the appropriate deadline, the failure to pay the penalty may apply.
- Accuracy-related penalty: applicable for taxpayers who underpay the tax required to be shown on their returns.
- Failure to deposit: if an employer fails to make employment tax deposits on time, in the correct manner, and with the right amount, a failure to deposit penalty may apply.
- Dishonored check penalty: if you used a check to make your tax payment and your check was returned due to insufficient funds, a dishonored check penalty may be issued.
- Other penalties such as Underpayment of Estimated Tax by Corporations, Underpayment of Estimated Tax by Individuals, and others.
It is important to understand that some penalties, such as Failure to Pay, may continue to accumulate until your tax balance is paid in full. For that reason, it may be worth consulting a tax attorney to see if it would be in your best interest to pay off your tax owed before seeking penalty abatement.
How Does Penalty Abatement Work?
The Internal Revenue Code authorizes the abatement of penalties imposed by the IRS for failure to file tax returns or for failure to pay tax and other penalties, as long as the failure is due
to reasonable cause and not willful neglect. Forgiveness of penalties is decided on a case-by-case basis.
Generally, if the taxpayer exercised ordinary business care and prudence and was, nevertheless, unable to file the return on time, the delay is considered due to reasonable cause. Also, a failure to pay may be due to reasonable cause if the taxpayer exercised ordinary business care and prudence yet could not pay the tax liability. If the IRS determines that failure to pay or failure to file was due to reasonable cause and not willful neglect, the penalty will not be assessed. You would still be responsible, however, for the underlying tax owed plus interest due.
What Kind of Penalty Relief May I Obtain from the IRS?
There are a few different kinds of penalty relief you may obtain, depending on the type of penalty you have been given, including First-Time Penalty Abatement Policy, Reasonable Cause, and Statutory Exception. In order to qualify for the First-Time Penalty Abatement Process, you must not have had any filing or tax issues in previous years, are currently up-to-date on all your returns, and have paid or made arrangements to pay any tax due.
When you have attempted to file your business tax return but have been unable to do so due to circumstances out of your control, such as a fire, casualty, natural disaster, serious illness, and any other sound reasons that may explain why you could not fulfill your tax obligations. Lack of funds is not in itself a valid reason unless the lack of funds is linked to an extenuating circumstance, as mentioned above.
Finally, taxpayers who received incorrect written advice from the IRS may be eligible for penalty abatement based on statutory exceptions. If the IRS gave you incorrect information and, as a result, ended up being assessed an incorrect penalty, you may be able to obtain penalty relief if you can submit the required evidence of the erroneous written advice you received from the IRS.
How Can a Tax Abatement Lawyer Help?
The Law Office of Ray Haselman can help you seek abatement of your penalties due to reasonable cause and get a reduction in the amount you owe. Our firm has assisted many clients in the Fort Lauderdale area in obtaining penalty abatement from the IRS, and we are ready to help you get a favorable result for your case.
We can conduct an evaluation of your current tax situation and make some recommendations. If we find an area of concern, you can rest assured that by engaging our services, our office will act as your advocate and seek to resolve your IRS problems. If you are dealing with IRS penalties and want to see if you are eligible for penalty abatement, contact our Fort Lauderdale office by calling 786-522-0410.