First-time offenders offered abatement from IRS

IRS bldgThe IRS has updated its First-time Abate (FTA) policy, which allows a first-time non compliant tax payer abatement of certain penalties for a single tax period.  The change comes after an April 2013 report from the Treasury Inspector General for Tax Administration (TIGTA) found the policy had not been consistently administered and that few taxpayers qualifying for relief actually requested it. Based on a taxpayer’s compliance history, FTA relief is potentially available for the (a) failure to file penalties under IRC Secs. 6651(a)(1), 6698 , and 6699; (b) failure to pay penalties under IRC Secs. 6651(a)(2) and 6651(a)(3); and (c) failure to deposit penalties under IRC Sec. 6656. The updated policy requires that in order to be granted relief, a taxpayer must have filed all currently required returns (or valid extensions) and paid or arranged to pay any tax due. Relief is not available for information reporting penalties, including delinquent foreign information returns. Use of the FTA can be requested by calling the IRS Practitioner Priority Service (PPS) line at (866) 860-4259.