What Types of Circumstances Qualify for Abatement?
Death, Serious Illness, or Unavoidable Absence
Several things can fall into this category. If you lost a spouse or a child or if you, your spouse or your child encountered a serious illness, you could qualify for abatement. Understand that this is not limited to physical illness – situations such as entering a rehabilitation program could qualify for abatement as well. Physical and mental impairment are also considered. An unavoidable absence could be something such as an incarceration. These, among other things, can be considered by the IRS for tax penalty removal.
Fire, Casualty, Natural Disaster, or Other Disturbance
If there was a significant natural disaster, fire, or some other catastrophic occurrence that made it impossible to pay your taxes on time, the IRS would consider that. Anyone would understand that if your house burns down or floods, finding somewhere to live is more important than a tax bill. The IRS understands that too.
If you’re unable to get all of the records to file your taxes accurately, you can request abatement for that reason. Didn’t get a 1099 or a W2 and later received a notice of adjusted taxable income and additional taxes? The IRS will take this into consideration when requesting abatement.
You made a mistake
If you file your taxes and then realize you made a mistake, you can request and abatement on those grounds, as long as you make an attempt to correct the mistake.
If you received oral or written advice from the IRS that was wrong and resulted in a tax penalty, the IRS will consider this for abatement. Please note, this does not cover advice from a CPA, accountant, bookkeeper or another third party.
Ignorance of the Law
If you had a recent change of circumstances and something became taxable income without you being aware of the newly taxable income, such as a pension payment after the death of a spouse, the IRS will consider this for abatement.
If you have a personal situation that would cause significant financial hardship to you if you paid your taxes, this could be a reason for abatement. A bankruptcy? The IRS will consider it.