How successful have you've been at reducing or eliminating the absurd penalties the IRS assesses your businesses (or your persons)? Have you used the IRS guidelines: http://www.irs.gov/irm/part20/irm_20-001-001r-cont01.html ? They talk about "reasonable cause exception". Have you found them reasonable?
IRS Penalty Abatements
Answers
I have had more luck with the states in reducing penalties, fees and interest. The IRS is a little direct and prescriptive with their penalties. I have learned that almost all
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I don't think its laziness, its a calculated methodology to increase the coffers.
It's the same thing done by utilities, multilevel call in menus, long wait times, longer wait times for supervisors or magically no supervisor there and you'll have to get a call back which doesn't come.
The squeaky wheel has a better chance at amelioration than someone who just "agrees".
I am in the middle of this very situation with two entities
The second entity's penalty I am trying to get abated is a $1,200 penalty for a nonprofit we manage. The CPAs actually failed to execute the extension. Hopefully the IRS will be gracious with this one.
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The CPA is probably responsible for the $12K, professional negligence. That's why they pay insurance :)
We write a number of the reasonable cause letters each year. The guidelines are readily available on line, so just check the list and see if you qualify and send the letter. These take time, and there most likely will be another follow up notice while you are waiting. That would be the best time to call in and put a hold on the account until it is resolved.
Our success rate is very high as long as the cause meets the criteria. Very rare to get abatement when the cause is weak or not well explained/thought out.
And sometimes it just pays to give Cesar his due; for the investment to argue just isn't worth it.
I received a $14.04 bill from the IRS. It cost them more than that to generate, process, etc. Same here, I just paid it.
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