When taxes remain unpaid after the filing deadline, IRS penalties and interest begin to accrue immediately—often increasing the total balance due each day. Even taxpayers who enter into an IRS-approved payment plan remain liable for penalties and interest on the full outstanding amount. Over time, these charges can add up significantly—penalties alone can raise a taxpayer’s bill by as much as 25%. In addition, a 5% penalty applies for failing to file a return at all. Fortunately, penalty abatement offers a powerful tool for tax practitioners to help clients reduce—or even eliminate—IRS penalties and related interest. The key is demonstrating that the taxpayer had a “reasonable cause” for noncompliance, such as serious illness, natural disaster, or other circumstances beyond their control.
If the IRS is convinced that a reasonable cause existed, it may fully or partially forgive the penalties assessed. Notably, the IRS tends to be more lenient with failure-to-pay penalties than with failure-to-file penalties. Ultimately, these charges are intended to promote timely compliance, not to punish hardship.
Learning Objectives:
• Ways to avoid the understatement of tax penalty
• IRS rules and thresholds for penalty and interest waivers
• The procedures and forms for requesting penalty relief
• The First-Time Abatement (FTA) program: qualifications and process
• How to qualify and apply for Reasonable Cause abatement
• Steps for requesting a refund of previously paid penalties
• Overview of available administrative appeal options
Credits and Other information:
• Credit: 2.0 (Taxes)
• Level: Basic
• Format: Live online webinar
• Duration: 120 minutes
• Requirement: Full attendance
• Prep: None needed
Who Will Benefit:
• CPA
• Enrolled Agents (EAs)
• Tax Professionals
• Attorneys
• Other Tax Preparers
• Finance professionals
• Financial planners
Speaker: A.J. Reynolds, EA
A.J. Reynolds, EA has over thirty years of experience encompassing various areas of taxation. Though his practice centers on Individual, Business, and Estate Tax preparation, A.J. focuses a portion of his practice to IRS Representation. As diverse as his specializations, A.J.’s clientele, too, ranges from average workers to Fortune 500 executives. Additionally, A.J volunteers his time with the Iowa Legal Aid’s Managing Attorney assisting in Tax Court cases and assorted income tax issues.
A.J. brings his everyday “in the trenches” experience to seminars and webinars for multiple organizations to assist attendees with real issues affecting tax professionals.
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