PSA: How to Get IRS Penalties Abated in 2025 - What Most Taxpayers Don't Know

This is super helpful! Question though - I got hit with a failure to file penalty for my 2023 taxes because I filed 3 months late. Would I qualify for First Time Abatement? I've never had penalties before but I'm not sure if it's too late to request it now in 2025?

You would likely qualify for First Time Abatement if you've had clean compliance for the three tax years prior to 2023. It's definitely not too late to request it now in 2025 - you generally have up to 3 years from when you filed the return or 2 years from when you paid the penalty (whichever is later) to request abatement. The best way to request it is to call the IRS directly at the number on your notice and specifically mention that you'd like to request "First Time Abatement" for your failure to file penalty. Have your notice and tax return information ready when you call.

Does it really work that easily? I've got a penalty notice for late filing my 2023 taxes because I was going through a divorce and everything was chaotic. Would this help with my situation too? Also, did you have to provide any documentation or just the letter?

I'm a bit skeptical... how much does this service cost? Seems like something I could just do myself with a template letter. And how do you know they're giving accurate advice? Have you verified the results with an actual tax professional?

It really did work that easily for me. The system specifically looks at your notice and circumstances to determine the best approach. For your divorce situation, it would likely recommend a reasonable cause abatement with some documentation about the divorce proceedings. I didn't need to provide documentation for my First Time Abatement request, just the letter, but for reasonable cause situations like yours they guide you on what supporting documents to include. Regarding cost and accuracy - I honestly felt the same way initially but decided to try it since the penalties were significant. The analysis was thorough and they explained exactly why I qualified for abatement using specific IRS rules and procedures. I did verify with a friend who's a tax preparer who confirmed their approach was correct.

How does this actually work? Do you have to give them your personal info? I'm worried about security and giving access to my tax information to some random service.

This sounds too good to be true. Are we seriously expected to believe that after weeks of not being able to reach the IRS, some magical service got you through in 2 days? And then they immediately approved your abatement request over the phone? I've dealt with the IRS for years and it's NEVER that easy.

The service is actually really straightforward. You enter your phone number on their website, and they use their system to dial the IRS and wait on hold. When they reach a human, they call you and connect you directly to the IRS agent. You're the one who talks to the IRS, not them, so you're not sharing any tax details with the service. I understand the skepticism completely. I felt the same way initially. What made the difference was that I was connected to the right department from the start rather than being transferred multiple times. The agent I spoke with was actually really helpful - they explained that for medical reasons, they can often approve penalty abatement immediately if it's clear-cut. More complex cases still require written correspondence, but simple reasonable cause scenarios can sometimes be handled on the call.

The key with reasonable cause requests is specificity and documentation. Don't just say "I had health issues" - explain exactly how your health prevented you from filing (were you hospitalized? Incapacitated? Under doctor's orders to avoid stress?). Also, the IRS looks for you to demonstrate that you filed as soon as you were able to. If you were sick in March but didn't file until October when the deadline with extension was April, they'll want to know why you didn't file shortly after recovery. If your first request was denied, you can try again with more detail and documentation. Include medical records (with personal details redacted), doctor's notes, or anything that verifies your condition. Also specifically state that you acted with "ordinary business care and prudence" but were still unable to meet your obligations due to circumstances beyond your control - that's language the IRS responds to.

Thanks for the detailed advice! I was in the hospital for about 3 weeks and then recovery at home for another month, but I just said "medical issues" in my letter without specifics. I'll rewrite with medical documentation and the exact dates and timeline, and use that "ordinary business care and prudence" language you suggested. One more question - should I send this as a new request or reference the previous denial? And should I mail it to the same address as before?

You should reference the previous denial in your new request. Include the date of the denial letter and any reference numbers it contained. This shows you're following up rather than making a completely new request. Mail it to the same address as shown on your denial letter. If possible, I'd recommend sending it certified mail with return receipt so you have proof of delivery. Include copies (not originals) of your medical documentation and the original denial letter. The hospital stay definitely strengthens your case significantly. Make sure to explain that you filed as soon as you were physically able to gather your tax documents and complete the return after your recovery.

I've used FreeTaxUSA for the past few years and they have some basic guidance about penalty abatement in their help section, but they don't actually generate the letter for you. For my abatement request last year, I ended up finding a template online and customizing it myself. It worked, but took me quite a bit of research to feel confident. If the amount of the penalty is significant (like over $500), it might be worth consulting with a tax pro. If it's smaller, the DIY approach with some good research might be more cost-effective. The IRS website actually has decent info on what they're looking for in abatement requests.

Your job loss situation definitely sounds like it could qualify for reasonable cause abatement! Termination letter and unemployment records are exactly the type of documentation the IRS looks for. You might also want to include any documentation showing when you found new employment and when you were able to make the payment - this demonstrates you paid as soon as you were financially able. Good news on timing - you generally have up to 3 years from when you filed the return or 2 years from when you paid the penalty (whichever is later) to request abatement, so you should still be well within the window for a 2022 penalty. When you write your request, be specific about how the job loss directly prevented you from making timely payments. Mention that you had to prioritize essential living expenses like housing, and that you made the payment as soon as your financial situation improved. The IRS wants to see that you acted responsibly given your circumstances. As someone new to this community, I'm really grateful for all the detailed advice being shared here - wish I had found resources like this sooner!

Your situation with caring for your father after his stroke sounds like a textbook example of reasonable cause! The IRS specifically recognizes family medical emergencies as valid circumstances beyond your control. For the level of detail in your letter, I'd recommend including a clear timeline - when the stroke occurred, the period you were managing his care, and when you were able to return to your own affairs. The power of attorney documents and hospital records will really strengthen your case since they provide objective proof of the situation. To answer your question about First Time Abatement - reasonable cause and FTA are completely separate! Using reasonable cause for your 2023 situation won't affect your ability to use First Time Abatement in the future. In fact, if you have multiple years with penalties, you could potentially use reasonable cause for some and save FTA for others. Given that you have strong documentation and a clear reasonable cause scenario, you could probably handle this successfully with a written request. However, with $1,200 in penalties, if you're not comfortable writing the letter yourself, the cost of getting professional help or using one of the services mentioned might be worth it for peace of mind. Welcome to the community - situations like yours are exactly why penalty abatement exists, and I hope you get those penalties removed!