Quick Answer
You can qualify for IRS penalty abatement through first-time penalty abatement (if you have 3+ years of clean filing history), reasonable cause (uncontrollable circumstances), or statutory exceptions. First-time abatement is the easiest, automatically removing failure-to-file, failure-to-pay, and failure-to-deposit penalties for eligible taxpayers.
Best Answer
Diana Flores, EA
Individual taxpayers who received their first IRS penalty notice and want to understand their options
What is IRS penalty abatement?
IRS penalty abatement is the removal or reduction of penalties the IRS has assessed against your tax account. According to IRS statistics, the agency abates approximately $1.2 billion in penalties annually, with first-time penalty abatement being the most commonly granted relief.
There are three main paths to penalty abatement, each with different qualification requirements and success rates.
The three types of penalty abatement
1. First-Time Penalty Abatement (FTA)
This is your best option if you qualify. The IRS will automatically remove failure-to-file, failure-to-pay, and failure-to-deposit penalties if you meet these criteria:
2. Reasonable Cause
The IRS will consider abating penalties if you can show the failure to file, pay, or deposit was due to reasonable cause and not willful neglect. Examples include:
3. Statutory Exceptions
Specific situations where penalties don't apply, such as:
Example: First-time penalty abatement calculation
Let's say you owe $5,000 in taxes and filed 6 months late, then paid 3 months after the due date. Here's what the penalties look like:
With first-time penalty abatement, the $1,575 in penalties would be completely removed, though you'd still owe the $150 in interest.
How to request penalty abatement
For first-time penalty abatement:
1. Call the IRS: Phone (866) 562-5227 and specifically request "first-time penalty abatement"
2. Write a letter: Include your name, SSN, tax year, and statement: "I request first-time penalty abatement per IRM 20.1.1.3.6.1"
3. File Form 843: Claim for Refund and Request for Abatement
For reasonable cause:
1. Gather documentation: Medical records, death certificates, disaster declarations, etc.
2. Write a detailed letter: Explain the circumstances, include timeline, attach supporting documents
3. File Form 843 with your explanation and evidence
Success rates by abatement type
What penalties can be abated?
Eligible for abatement:
NOT eligible for abatement:
Common mistakes to avoid
What you should do
1. Check your penalty notice against the three-year look-back period for first-time penalty abatement
2. Call the IRS immediately if you qualify for FTA - it's faster than writing
3. Use our form explainer tool to understand exactly what penalties you're facing and which abatement option fits your situation
4. Document everything - keep records of all communications with the IRS
Key takeaway: First-time penalty abatement removes failure-to-file, failure-to-pay, and failure-to-deposit penalties completely if you have 3+ years of clean filing history. With an 85-90% approval rate, it's worth requesting even for penalties of just a few hundred dollars.
*Sources: [IRS Publication 1](https://www.irs.gov/pub/irs-pdf/p1.pdf), Internal Revenue Manual 20.1.1.3.6.1*
Key Takeaway: First-time penalty abatement has an 85-90% approval rate and can save thousands in penalties if you have 3+ years of clean filing history.
Comparison of the three main penalty abatement options available to taxpayers
| Abatement Type | Approval Rate | Processing Time | Documentation Required | Best For |
|---|---|---|---|---|
| First-Time Penalty Abatement | 85-90% | 2-4 weeks | None | Clean 3-year history |
| Reasonable Cause | 35-60% | 6-12 weeks | Extensive | Uncontrollable circumstances |
| Statutory Exception | 70-80% | 4-8 weeks | Specific qualifying docs | Disaster/IRS error situations |
More Perspectives
Michelle Woodard, JD
Taxpayers who already received penalty notices and need to respond quickly
Time-sensitive response to penalty notices
When you receive an IRS penalty notice, you typically have 30-60 days to respond before the penalties become final. The notice will show the specific deadline, and missing this deadline makes abatement much harder to obtain.
Immediate steps after receiving a penalty notice
1. Don't panic, but act quickly. Even if you disagree with the penalty, respond within the timeframe shown on the notice.
2. Verify the penalty calculation. Common errors include:
3. Determine your abatement strategy:
Phone vs. written requests
Call first for first-time penalty abatement: The IRS can verify your compliance history immediately and grant FTA over the phone in most cases. This saves weeks compared to written requests.
Write for reasonable cause: Complex situations require detailed explanations and supporting documentation. A phone call alone usually won't be sufficient.
What to say when calling the IRS
"I received Notice CP XXX dated [date] for tax year [year]. I would like to request first-time penalty abatement for the failure-to-file and failure-to-pay penalties. I believe I qualify because I have filed all required returns and paid all taxes for the prior three years with no penalties."
Have your notice, Social Security number, and prior year tax information ready.
If first-time penalty abatement is denied
Don't give up. You can still request reasonable cause abatement even after FTA is denied. The IRS treats these as separate requests, and you might qualify under different criteria.
Common reasonable cause situations for people who received notices:
Key takeaway: Respond to penalty notices within 30-60 days. First-time penalty abatement can be granted over the phone in 2-4 weeks, while reasonable cause requires written documentation but offers a second chance if FTA is denied.
Key Takeaway: Respond to penalty notices within 30-60 days. First-time penalty abatement can be granted over the phone in 2-4 weeks, while reasonable cause requires written documentation but offers a second chance if FTA is denied.
Sources
- IRS Publication 1 — Your Rights as a Taxpayer
- Internal Revenue Manual 20.1.1.3.6.1 — First Time Penalty Abatement Policy
Related Questions
Reviewed by Diana Flores, EA on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.