Penalties....Poof, Abated!

[DaveinTexas]

I had a client come in a few weeks ago to prepare her 2005 return and, of course, she had a balance due. I explained to her that penalties and interest will follow and she understood.

Her balance due notice comes in the mail and she calls the IRS number on the letter. She speaks to an IRS employee and asks if there is anyway for the penalties to be removed, giving no reasonable causes to do so.

The IRS employee says, "Let me see if the computer will let me do that.....click, click, click, ah, they're taken off. Is there anything else I can help you with?"

I guess it never hurts to ask. So I think I am going to hire my client to be my IRS case resolver.....good stuff!

[Luis Mopeo]

I had a client come in a few weeks ago to prepare her 2005 return and, of course, she had a balance due. I explained to her that penalties and interest will follow and she understood.

Her balance due notice comes in the mail and she calls the IRS number on the letter. She speaks to an IRS employee and asks if there is anyway for the penalties to be removed, giving no reasonable causes to do so.

The IRS employee says, "Let me see if the computer will let me do that.....click, click, click, ah, they're taken off. Is there anything else I can help you with?"

I guess it never hurts to ask. So I think I am going to hire my client to be my IRS case resolver.....good stuff!

Sometimes it's amazing what's available just for asking. Sometimes all you have to do is show up.

I would be a bit wary for a while to make sure another notice doesn't show up. Hopefully this isn't a case of a cynical IRS employee with a dry sense of humor who was having a bad day.

[Kram BergGold]

This is teh penalty assistor program

For those of you who do not know, everyone with no record of past penalties back to 2003 or so (I don't know the actual year for sure) can use a once in a lifetime "get out of penalty relief" just by asking. Sometimes the IRS Rep makes you tell a little story first, sometimes not. You should also know you can't pick and choose your one time relief. If in 2005 you owed a late payment penalty of $10 this and only this penalty can be removed. So if in 2006 you have a $500 penalty you won't be able to remove it becasue of the $10, 2005 penalty, regardless of whether you removed it or not.

[equinecpa]

I remember reading something along these lines...do you have a cite or a reference for us? I'd like to be able to refer to something when the IRS employee says " no way, no how".

[DaveinTexas]

I like it when the IRS says

"Interest can never be abated."

In their own code it states: Section 6404(e) gives the IRS the authority to abate interest when the additional interest is attributable to IRS errors or delays.

But yet, I had another IRS employee tell me yesterday that interest is never abated.

As far as penalties go, they should always be abated when there is reasonable cause. Reasonable cause is, well, just use your imagination. I suppose it also matters who opens your letter. Then if denied, appeal the decision and hope for the best.

[fliszt]

This situation

happened to me when preparing my parents estate and trust final return. Long story but the bottom line is we owed close to $20k in penalty/interest. Working with an attorney, IRS employee and myself on a 3-way telcon, the lady volunteered to remove penalty AND interest. Neither the attorney nor myself knew this was possible. She said "one in a lifetime" removal and since this was first return, she went click-click on her computer and it was gone!! She was an amazing lady. I tried to obtain her direct phone number, but no luck. I spoke to her supervisor and told of her extra ordinary helpfulness and said the IRS should hang on to her at all costs. :-)

[bertrans]

Poof

There is no 'once in a lifetime' interest abatement by the IRS. Interest can only be abated if it resulted from an IRS error (ministerial or managerial act).

[fliszt]

What can

I say. I'm sure you're right, but in this case, interest and penalty was removed.

[ChEAr$]

Ah so!

I say. I'm sure you're right, but in this case, interest and penalty was removed.

But Larry, in this case notice he was in the Philadelphia area!
'nuff said. (grin

[fliszt]

how do

you put a "smiley" on the msg?

Oh. It worked.