Penalty Abatement Defined

Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about Penalty Abatement and other Tax Relief topics.

What is a penalty abatement?

Penalty Abatement Defined

When a taxpayer is involved in repaying their delinquent tax bill with the IRS, an option available is known as an abatement.

An abatement, an IRS tax resolution method, allows taxpayers to repay their applicable tax bill, but the accompanying penalty or interest (if any) is removed from the tax bill. Therefore, taxpayers do not have to repay any penalties or interest on their tax bill. The penalty and interest are abated.

Do not consider an abatement if you cannot pay at least 75% of your total tax liability (less any penalties and interest).

In order to qualify for receiving a penalty abatement, however, you must show the IRS good reason (reasonable cause) for not being able to pay the entire amount due. As mentioned in other tips, reasonable causes consist of death, loss of income, illness, or imprisonment.

Request a penalty abatement using IRS Form 843 (Claim for Refund and Request for Abatement).



Nobody has commented on this tip yet. Be the first.


URL: (optional)


Not finding the advice and tips you need on this Tax Relief Tip Site? Request a Tip Now!

Guru Spotlight
Jolyn Wells-Moran