Atlanta CPA: Seeking Penalty Abatement from the IRS
In Seeking Penalty Abatement from the IRS the first item will be needed is to sign an power of attorney allowing a CPA to talk to the IRS on your behalf. The foremost item needed will be to have you prepare a detailed affidavit detailing the items that created the late filing and payment as well as what action steps you have done to ensure that you stay compliant on all tax issues in the future. It will be essential to get a copy of all IRS tax notices that were paid late being sure to recap them by Form Number, Period Covered, Initial Amount Due, Payments Against Amounts Due, Present Amounts Due.
When you get a good rough draft of your IRS plea to request penalty abatement, please e mail it to me so that I might offer critiques. We will most likely need to work on the letter a bit to get it in a workable presentable format to send it to the IRS. Feel free to call me might you have any questions.
“The U.S. tax system is one where it’s the taxpayers responsibility to correctly fill out their taxes to ensure that they pay only their lowest legal possible tax. As an Atlanta CPA for decades this is perhaps the most true when dealing with IRS Tax Representation Issues. Be sure you work with a CPA who is well experienced before you begin to address your Back Taxes, Penalty Abatement or Offer in Compromise.” — Atlanta CPA, John Dillard CPA
On your letter you will want to address all the types of taxes owed by specific reference listing the years as well detailing the circumstances to both.
You will want to spend a fair amount of time detailing what you have done to correct this issues covering:
• Hiring a CPA for all of your income tax filings and to get all of your back taxes current.
• Hiring a payroll service to ensure that all of your future payroll taxes as well as federal and state withholdings will be current in both their filings and their payments.
In determining if your IRS late payment and late filing penalties can be abated the IRS will consider:
Failure to timely and failure to pay payroll and income tax returns when due, absent reasonable cause, can give rise to tax penalties being assessed by the IRS and the state of Georgia. Whether an organization qualifies for the reasonable cause exception to the penalty will be determined on a case-by-case basis taking into account all relevant facts and circumstances.
The regulations provide that a request for abatement of penalties based on reasonable cause must be made in the form of a written statement, containing a declaration by the appropriate person that the statement is made under penalties of perjury, setting forth all the facts alleged as reasonable cause. When requesting abatement of penalties for reasonable cause, your statement should include supporting documentation and address the following items:
Explain what prevented the organization from complying with the law, including:
o Detailed statement detailing how the organization was not neglectful or careless, but exercised ordinary business care and prudence and what facts and circumstances can you state to prove this.
o Specific action steps you have taken to prevent the same situation from occurring in the future including the hiring of a CPA, a payroll service and educating yourself on IRS and Georgia tax law surrounding the timely filing and payment of all payroll and income taxes due.
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