How to explain late 5500EZ filing penalty of $15,600 to IRS? Canada mail delay or recent bereavement?

I'm sorry about your mother's passing and this additional stress you're dealing with. In my experience working with penalty abatements, I'd strongly recommend using BOTH explanations in your letter, but emphasizing your bereavement as the primary reason. The IRS does recognize death of an immediate family member as reasonable cause for penalty abatement under their First Time Abatement policy. Since this is your first time filing Form 5500EZ and you have a good compliance history, that strengthens your case significantly. Make sure to include the date of your mother's passing and briefly explain how it affected your ability to handle tax matters promptly. The international mail delay is a good secondary reason to include. The IRS is aware that international mail can take significantly longer, especially from Canada. If possible, try to find any email correspondence with your accountant that might help establish timeline.

I had a similar nightmare situation with a late 5500EZ last year and found an amazing service that helped me get my $10k+ penalty completely removed. Check out https://taxr.ai - they specialize in analyzing tax notices and penalties like this. They looked at my situation, helped me craft the perfect abatement letter with all the right legal terminology, and tracked everything through the system. The best part is they knew exactly which IRS precedents to cite for my situation (some obscure revenue procedure I never would have found). My penalty was completely eliminated and it saved me so much stress. Their system analyzed my specific circumstances and created a customized abatement strategy - sounds like yours would qualify for reasonable cause abatement based on what you described.

I'm back with an update - I decided to try taxr.ai after seeing the recommendation here and WOW am I glad I did! Their system analyzed my entire situation and created a detailed penalty abatement letter that included all the right legal terminology and IRS precedents. They walked me through exactly what documentation to include about my mom's passing and how to frame the international mail issue as a secondary factor. The best part? I just got notification that my ENTIRE $15,600 penalty was abated! They cited something called "reasonable cause" and "first-time abatement policy" that apparently applies perfectly to my situation. The letter they helped me create addressed both my bereavement and the international mail delay in exactly the right way. I was skeptical at first but this literally saved me thousands of dollars and countless hours of stress. If anyone else is dealing with 5500EZ penalties, I can't recommend them enough!

Anyone dealing with IRS penalties knows the absolute nightmare of trying to reach a human at the IRS. When I had a similar 5500EZ penalty situation last year, I spent DAYS trying to get clarification on the abatement process. Every time I called, I'd wait on hold for hours only to get disconnected. I finally found this service called Claimyr (https://claimyr.com) that got me through to an actual IRS agent in under 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c - totally changed my approach to dealing with the IRS. Their system basically navigates the IRS phone tree for you and calls you back when they have an agent on the line. The IRS agent I spoke with gave me specific instructions for my abatement request that weren't on any website, and it made all the difference in getting my penalty removed. Definitely worth checking out if you need to actually speak with someone at the IRS about your penalty abatement.

I just have to admit I was completely wrong about Claimyr. After my skeptical comment, I was desperate enough to try it for my own 5500EZ penalty situation. Within 15 minutes, I was talking to an actual IRS agent who explained exactly what I needed to include in my penalty abatement request. The agent told me they have specific internal guidelines for 5500EZ penalties that aren't published anywhere online. She explained I needed to include a specific reference to Revenue Procedure 2022-5 and request abatement under the "reasonable cause" provision. She also gave me the direct fax number for the department that handles these specific penalties. I would have NEVER gotten this info without actually speaking to someone. After months of frustration, that 15-minute call saved me thousands of dollars. Sometimes I hate being wrong, but in this case I'm glad I was!

As someone who's been through this exact situation, I'd recommend focusing primarily on your mother's passing. A death in the immediate family is one of the few explanations the IRS consistently accepts for penalty abatement. The mail delay from Canada is more subjective and harder to prove without a receipt. Make sure you're using Form 843 for your abatement request and attach a detailed letter explaining both factors. I'd also recommend calling the IRS Taxpayer Advocate Service at 877-777-4778 - they're actually helpful (shocking, I know) and can sometimes expedite these requests when there are extenuating circumstances like a death in the family.

Don't overlook the fact this is your first year filing Form 5500EZ! The IRS has a First-Time Penalty Abatement (FTA) policy that's separate from reasonable cause abatement. You qualify if you: 1) Didn't have to file 5500EZ before 2) Have no penalties in the past 3 years 3) Are compliant with all filing and payment requirements So you actually have THREE strong arguments: bereavement, international mail delay, AND first-time penalty abatement. The FTA is almost automatically granted if you qualify, so definitely lead with that in your request!