Background

The IRS grants penalty relief when taxpayers show “reasonable cause” — that an event or circumstance prevented timely compliance and the taxpayer acted with ordinary business care and prudence. Reasonable cause can apply to failure-to-file, failure-to-pay, and certain information-reporting penalties. (See IRS Penalty Relief for current guidance.)

Why a well-crafted letter matters

The IRS reviews facts and documentation, not emotion. A short, factual letter that explains what happened, why you couldn’t comply, what you did to correct the issue, and attaches evidence gives the examining agent what they need to make a decision.

Step-by-step: How to prepare your Reasonable Cause Letter

  1. Start with identifying information
  • Taxpayer name, address, SSN or EIN, and daytime phone.
  • The IRS notice or letter number and the tax period(s) involved.
  1. State the request clearly
  • One-line request: e.g., “I am requesting abatement of the penalty assessed on [date] for tax period [year] due to reasonable cause.”
  1. Describe the facts in chronological order
  • Explain the event (dates, locations, and key facts). Keep it concise and specific.
  • Explain how the event prevented compliance; link actions you took to try to comply.
  1. Show you acted in good faith
  • Note efforts to file/pay when able, attempts to obtain correct records, or reliance on reasonable professional advice.
  1. Attach supporting documentation
  • Medical records, hospital discharge, death certificate, layoff notice, FEMA or insurance claim, police reports, or proof of mailing.
  • For professional-advice reliance, include written communications from the preparer.
    (See our evidence checklist for details.)
  1. Close with your signature
  • Sign, date, and include a copy of the assessment or notice. Keep originals; send copies.

Sample template

[Your name]
[Your address]
[City, State ZIP]
[SSN last 4 or EIN] | [Daytime phone]

[Date]

Internal Revenue Service
[Address shown on your notice]

Re: Request for penalty abatement (Reasonable Cause)
Notice/Letter number: [XXXX]
Tax period(s): [YYYY]

To Whom It May Concern:

I request abatement of the penalty assessed for the tax period(s) above due to reasonable cause. On [date(s)] I experienced [brief description of event — e.g., hospitalization, house fire, natural disaster, job loss]. As a result, I was unable to [file/pay/complete required reporting] by the due date.

I took the following steps to comply when reasonably possible: [list actions and dates — e.g., attempted to get records, contacted preparer, mailed payment]. Attached are copies of supporting documents: [list attachments].

I believe these facts show I exercised ordinary business care and prudence but was prevented from timely compliance by circumstances beyond my control. I respectfully request abatement of the penalty and will comply with any additional steps required.

Sincerely,

[Signature]
[Typed name]

What to include with your letter (evidence checklist)

  • Exact dates related to the event (admission/discharge, disaster dates, termination date).
  • Official documents: hospital records, death certificates, termination letters, FEMA or insurance documentation, police reports, court papers.
  • Proof of attempts to comply: emails, certified mail receipts, canceled checks, billing statements.
  • If relying on tax preparer advice, include written communications and the preparer’s details.

Where and how to send the letter

  • Mail your letter and copies of your documents to the address shown on the IRS notice you received. If you do not have a notice, send to the IRS office handling your account or use your IRS online account correspondence options if available.
  • In some cases you can request penalty relief by phone or through an authorized representative. For procedural details, see our guide on how to request penalty abatement from the IRS and evidence that matters for reasonable-cause letters.

Timing and expected response

The IRS’s response time varies; many taxpayers hear back in 30–60 days, but complex cases may take longer. If denied, you may request an administrative appeal through the IRS Appeals Office or seek help from the Taxpayer Advocate Service. (See IRS Penalty Relief and Understanding Your Notice.)

Common mistakes to avoid

  • Missing key dates or failing to attach proof.
  • Vague statements without documentation (“I was ill”). Include specifics and dates.
  • Submitting only originals — always keep your originals and send copies.
  • Waiting too long after receiving the penalty notice; respond promptly.

Professional tips

  • Lead with the strongest documentary evidence in the first paragraph after the request statement.
  • Keep the narrative factual and brief — 1–2 pages is usually enough.
  • If you expect ongoing issues (e.g., lingering disability), explain how you will comply going forward.
  • Consider professional help for complicated or high-dollar penalty cases; in my 15+ years of tax resolution work, detailed documentation and a clear timeline often change outcomes.

Related resources

Authoritative sources

Disclaimer

This article is educational and does not constitute personalized tax advice. For guidance tailored to your facts, consult a tax professional or CPA.