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Penalty Abatement

Removal or Recovery of Tax Penalties and Interest
  One of the most common complaints from delinquent taxpayers is snowballing tax penalties and interest. This problem can quickly escalate, as your accumulation can double the amount of tax owed in as little as four years.

Current IRS code allows for abatement (removal) of tax penalties and interest or a refund when there were extenuating circumstances contributing to this problem, or if you had a good reason for falling behind in the first place. In order to accomplish this, you may have to show the IRS that you had "reasonable cause" for not paying taxes. Some examples of reasonable cause include:

  • Embezzlement or theft
  • Fire, flood or other disasters out of your control
  • Bad accounting device
  • Lost or destroyed records
    •
You must also show "due diligence" and "no neglect" in attempts to repay your debt. You need to describe to the IRS exactly what efforts were made to repay your debt. If you show a consistent or significant effort in this regard it's often sufficient to recoup all, or a significant portion of your tax penalties.

Resolve your past due tax debt problems without hiring a professional. Learn more about our do it yourself tax debt reduction kit .







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