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Tag Archives: IRS

First Time Abatement: A Helping Hand When Dealing with the IRS

forgiveness for tax penalties

Tax day has come and gone, but for many, the stress and uncertainty still remains. While taxes are stressful for everyone, they can be especially stressful for anyone dealing with penalties resulting from self-reporting errors. If this is your first time facing a penalty from the IRS, you may be eligible for a first time abatement, which could significantly decrease the amount you have to pay in penalties. What is a First Time Abatement? A first time abatement, or FTA, is a clause that allows first time offenders to file to have their penalties waived if they are able to prove their claim that extenuating circumstances made it difficult or impossible to pay their full owed amount on time. You may qualify for an FTA if this is your first time facing a penalty with the IRS for failing to file, failing to pay, or failing to deposit payroll taxes.  You may also qualify if you can prove that you were dealing with a death or illness, if you filed incorrectly or the IRS made a mistake, if you made a mistake but can prove a normally strong track record, if you were misled by a tax professional, or if ...

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What if I Can’t Pay My Income Taxes?

We are just over a month away from April 15th, when income taxes are due in the US. I have perhaps an unfounded fear of the Internal Revenue Service. I’ve never actually met anyone who worked there, and I have no reason to believe they are bad people, but they did get Al Capone. There has to be some merit to my fears. While thankfully I’ve never had to deal with this reality, I’ve often wondered, what happens if you can’t pay your income taxes? I think my fear started the first year I owned a business. Before that, I got paychecks. Taxes were withheld. I filed returns, and usually got a tax refund. Buying a business flipped that all upside down. I did know that I needed to pay quarterly returns, but with everything else going on, I didn’t. The business also made a profit, which is wonderful, but it caused me to owe $20,000 in taxes that first year. After some careful repurposing of funds, we were able to pay the bill. That has been several years ago, but I still experience a weird state of mind during tax season. I always have a bit of panic until ...

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