The interest follows the penalty
Interest on the tax itself is generally not abatable, but interest charged on a penalty comes off when the penalty does.
IRS Problems
A large part of what you owe may not be tax at all
Penalties and the interest they carry can be a third or more of an IRS balance. Some of it is removable, and nobody removes it unless you ask.
Three penalties do most of the damage. Failure to file is charged monthly on the unpaid tax and accrues roughly ten times faster than failure to pay, which is why filing on time matters even when you cannot pay. Failure to deposit hits employers on payroll taxes and steps up with the number of days a deposit is late. Each one is assessed automatically, and each one can be challenged.
There are two main routes. First-time abate is an administrative waiver for taxpayers with a clean compliance record in the preceding years — it is granted on the record itself, not on a story. Reasonable cause is the route when something genuinely prevented compliance: serious illness, a death in the family, records destroyed, a preparer who failed. Where a penalty has already been paid, the claim goes in on Form 843. We read the transcript first, because it shows exactly which penalty codes were charged and when.
Scope
What’s included
Penalty-by-penalty transcript review
Every penalty on the account identified by type, year and amount, so nothing removable is missed.
First-time abate requests
Where the prior compliance record supports it, this is the cleanest relief available and does not need a hardship story.
Reasonable-cause letters
A documented written request tied to the facts and dates, not a template — illness, loss, disaster or records beyond your control.
Form 843 claims
Where the penalty has already been paid, the request becomes a refund claim and is filed on Form 843.
Employer deposit penalties
Failure-to-deposit penalties are frequently misapplied when payments are credited to the wrong period. We check the posting.
Appeal of a denial
A refused abatement can go to the Independent Office of Appeals, which reviews it on the record we built.
Outcome
Why it matters
It is asked for, never automatic
The IRS does not review accounts looking for penalties to remove. Relief exists for taxpayers who request it.
It changes what comes next
A smaller balance changes which payment plan you qualify for and how long the plan runs.
Process
How it works
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Read the account
Account transcripts show each penalty, its code, and the date it posted. That is where the request starts.
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Pick the route
First-time abate where the record qualifies, reasonable cause where the facts are stronger than the record.
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Document and request
Medical records, death certificates, disaster declarations, correspondence — the evidence goes in with the request.
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Confirm on the transcript
We do not close the file on a phone call. We confirm the reversal posted to the account.
Suited to
Who this is for
- Taxpayers with a clean history and one late year
- Anyone whose balance is mostly penalties and interest
- Employers charged failure-to-deposit penalties
- People who filed late because of illness, loss or disaster
- Taxpayers let down by a previous preparer
FAQ
Questions
Interest on the underlying tax is generally not abatable — it is statutory, and it runs until the tax is paid. Interest charged on a penalty is different: when the penalty is removed, the interest that accrued on it is removed with it.
Not on its own. Lack of funds is generally not accepted as reasonable cause for failing to pay, though the circumstances that caused it sometimes are. Failing to file is a separate penalty with its own analysis, and it is the more expensive of the two.
It depends on whether the penalty is still unpaid or has already been paid. An unpaid penalty can be addressed while the balance is open; a claim for one already paid is a refund claim with its own statutory time limit, which is why we check the payment dates before filing anything.
Often needed alongside this
Other services
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IRS Representation & Audit Defense
Sign a Form 2848 and every letter, every phone call and every deadline becomes ours to manage.
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Back Taxes & Unfiled Returns
Unfiled returns and unpaid balances feel permanent. They are not. Almost every case has a defined, legal path to resolution — the hard part is starting it.
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Installment Agreements & Payment Plans
An instalment agreement will not reduce what you owe, but it stops the collection machine and puts the balance on a schedule you can live with.
Let’s find out what you should actually be paying.
Thirty minutes with an Enrolled Agent, at no charge. Bring last year’s return and we will tell you plainly what we would do differently — and what it would cost.