Penalty Abatement Under Reasonable Cause

What is Reasonable Cause

The IRS may abate (remove) penalties if the taxpayer can demonstrate that they exercised ordinary business care and prudence but were still unable to comply with tax obligations. This relief often applies to:

• Failure to File (FTF) penalties
• Failure to Pay (FTP) penalties
• Accuracy-related penalties (in some cases)
• Information return penalties (e.g., 1099s, FBARs)

If you’re working with a tax preparer Atlanta trusts, or a tax preparation CPA Atlanta families and businesses rely on such as EAS, we will help you build a strong reasonable cause case with supporting documentation.

1. The IRS Framework

When reviewing reasonable cause requests, the IRS evaluates:

• What happened: The specific event(s) that caused noncompliance.
• When it happened: The timing of the event in relation to the deadline.
• How it caused the issue: The connection between the event and the missed filing or payment.
• How the taxpayer acted afterward: Whether the taxpayer quickly corrected the issue.

An experienced Atlanta CPA for tax filing can ensure your timeline, facts, and supporting records are presented clearly to maximize approval chances.

2. Best Reasonable Cause Arguments

A. Serious Illness, Death, or Unavoidable Absence

Examples: hospitalization, death in the family, or emergencies that prevent timely filing. Documentation may include medical records or death certificates.

B. Natural Disasters, Fire, or Other Casualty

Events like floods, hurricanes, fires, or theft disrupting business or destroying records. IRS disaster relief notices strengthen these cases.

C. Inability to Obtain Necessary Records

When banks, employers, or third parties delay critical information, even diligent taxpayers may be unable to file on time.

D. Reliance on a Tax Professional

If you relied on a qualified tax specialist Atlanta residents trust, but misinformation or error caused late filing, you may have a case.

E. Financial Hardship / Inability to Pay

Strongest for Failure to Pay penalties—supported by bank statements, attempts to borrow, or evidence of severe cash flow challenges.

F. Major Life Events

Divorce, military deployment, or other life-altering events disrupting normal financial activity.

G. Other Extraordinary Circumstances

Such as postal errors, IRS mistakes, or identity theft.

3. Weak or Rejected Arguments

• Forgetting a deadline
• Not knowing filing requirements
• Being “too busy”
• Disagreeing with penalty fairness

A seasoned CPA tax services Atlanta provider can help you avoid weak arguments and focus on facts that resonate with IRS evaluators.

4. Best Practices for a Strong Abatement Request

1. Use IRS terminology: “Ordinary business care and prudence” and “facts and circumstances” are key phrases.
2. Present a clear timeline. Show what happened before, during, and after the noncompliance.
3. Attach documentation (medical records, disaster reports, financial evidence).
4. Show corrective action—returns filed, balance paid, or installment plan in place.
5. Request First-Time Abatement (FTA) if eligible before arguing reasonable cause.
6. Keep the letter concise, professional, and fact-based. IRS employees process hundreds of requests—clear, documented narratives are more persuasive.

Summary:

The strongest penalty abatement requests rely on uncontrollable events—serious illness, natural disasters, inability to access records, reliance on a tax professional, or financial hardship. With the guidance of an experienced tax preparer Atlanta, or a trusted tax preparation CPA Atlanta, you’ll be better positioned to present a compelling case.

If you need help, an Atlanta CPA for tax filing with proven CPA tax services Atlanta residents depend on can prepare your request, gather documentation, and advocate with the IRS to reduce or remove penalties.

Don’t Wait Until You’re Flagged

The IRS is investing in powerful technology to crack down on tax compliance. That makes now the best time to get ahead of any potential issues—before enforcement ramps up further.

If you’re dealing with back taxes, unfiled returns, or notices from the IRS, don’t ignore the problem. Act now and work with a trusted Atlanta tax professional who understands both the traditional and modern tactics the IRS uses.

Partner With EAS—Your Atlanta Tax Resolution Experts

At Expert Accounting Services – Atlanta, we are proud to be an Atlanta-based firm led by a Certified Tax Resolution Specialist and Certified Public Accountant (CPA). We serve individuals, small businesses, and self-employed professionals across Atlanta and nationwide. Whether you’re looking for reliable tax resolution services Atlanta residents trust or need a knowledgeable tax preparer Atlanta clients recommend, we’re here to help.

📅 Schedule a consultation today using our Calendly link.

If you know of anyone in need of assistance with an IRS problem, please have them call us at (404) 719-0330, or send us an email at GLG@eas.tax.