How to Request an Abatement for Erroneous Penalties and Interest

Background

Taxpayers can seek abatement when penalties or interest are wrong, excessive, or stem from circumstances beyond their control. The IRS provides several relief paths, including:

• Reasonable-cause abatement (common for illness, natural disaster, or death) (see IRS penalty information: https://www.irs.gov/penalties).
• First-Time Abatement (FTA) for qualifying taxpayers with a clean compliance history.
• Administrative abatement where IRS error caused the charge (interest abatement is limited and usually granted only when delays or mistakes are the IRS’s fault).

Form and legal basis

Most abatement requests use Form 843, Claim for Refund and Request for Abatement (https://www.irs.gov/forms-pubs/about-form-843). Form 843 covers penalty and interest claims in many situations, but some relief (like FTA) can be requested by phone or in writing without Form 843, depending on the notice and penalty type.

Step-by-step: How to prepare and submit an abatement request

1. Review the notice and identify the exact penalty and interest amounts. Keep the IRS notice or CP/letter number.
2. Determine the right relief path: reasonable cause, FTA, administrative error, or an appeal (see Appeals procedures: https://www.irs.gov/appeals).
3. Gather evidence: appointment notes, medical records, disaster declarations, bank statements, payment confirmations, and any correspondence showing IRS error.
4. Complete Form 843 when applicable. In the explanation box, state clearly why the penalty/interest is erroneous, the dates involved, and attach supporting documents.
5. If claiming a refund, verify deadlines. Refund-claim timing follows IRS rules—generally within three years of the return filing or two years from tax payment (see Form 843 instructions).
6. Send the request following the notice instructions (certified mail for paper submissions gives a tracking record). If the notice advises a phone option (FTA or similar), follow that route.
7. Track and follow up—expect weeks to months; complex claims take longer.

Interest abatement nuances

Interest is treated differently than penalties. The IRS generally does not abate interest for a taxpayer’s own mistakes, but will consider abatement when interest results from IRS error or unreasonable delay (see IRS guidance on interest and abatement via Form 843: https://www.irs.gov/forms-pubs/about-form-843). If your case involves both erroneous penalties and resulting interest, explain both in the same request and provide evidence tying interest to the IRS error.

Who is eligible

Most individuals and businesses assessed penalties can request abatement. Common qualifying scenarios include:

• Serious illness or death of the taxpayer or immediate family member.
• Natural disasters that disrupted tax filing/payment.
• Incorrect or misleading guidance from the IRS or its representatives.
• Administrative errors by the IRS (processing delays, lost payments).

What evidence matters

• Official records (medical records, court documents, FEMA/state disaster declarations).
• Proof of timely action (proof of mailing, payment receipts, bank records).
• Correspondence showing IRS error or incorrect guidance.

Professional tips from practice

• Document contemporaneously. In my practice helping taxpayers for 15+ years, cases with time-stamped evidence and clear timelines have markedly higher approval rates.
• If you qualify for First-Time Abatement, use the phone option described on IRS notices before filing Form 843—FTA can be faster and doesn’t always require Form 843.
• For complex or high-dollar claims, include a one-page executive summary at the front of your submission that states the request, the relief sought, and the core evidence.

Common mistakes to avoid

• Sending vague explanations without supporting documentation.
• Using the wrong form or sending the request to the wrong address listed on the IRS notice.
• Waiting too long to act—missing deadlines for refund claims or appeals can forfeit relief.

Related resources on FinHelp

• Evidence checklist for reasonable-cause abatement: How to Get a Penalty Abatement for Reasonable Cause: Evidence Checklist (https://finhelp.io/glossary/how-to-get-a-penalty-abatement-for-reasonable-cause-evidence-checklist/)
• Choosing the right submission method: When and How to Request an IRS Penalty Abatement by Phone vs Mail (https://finhelp.io/glossary/when-and-how-to-request-an-irs-penalty-abatement-by-phone-vs-mail/)
• Building a strong reasonable-cause request: Penalty Abatement Essentials: Building a Strong Reasonable-Cause Request (https://finhelp.io/glossary/penalty-abatement-essentials-building-a-strong-reasonable-cause-request/)

Frequently asked questions

Q: How long will the IRS take to decide?
A: Response time varies. Simple FTA requests can be resolved in weeks; complex Form 843 claims often take months. Follow up using the contact information on the original notice.

Q: Can I appeal a denial?
A: Yes. Denials can be appealed through the IRS Office of Appeals. Keep deadlines in mind and consider professional representation for complex disputes.

Q: Are state penalties handled the same way?
A: No—states have separate procedures. Contact your state tax agency for state-level abatement rules.

Authoritative sources

• IRS — Penalties (general): https://www.irs.gov/penalties
• IRS — About Form 843, Claim for Refund and Request for Abatement: https://www.irs.gov/forms-pubs/about-form-843
• IRS — Appeals: https://www.irs.gov/appeals

Professional disclaimer

This article is educational and does not replace personalized tax advice. For specific cases, consult a CPA, enrolled agent, or tax attorney familiar with your facts and current IRS rules.