The IRS uses penalties and interest charges to encourage taxpayers to comply with tax laws.
Many taxpayers don’t know how to or have the knowledge to ask for penalty relief. Our professional tax attorneys are here to represent you in your fight to get relief from unnecessary penalties.
What Are The Two Most Common Types of Civil Penalties?
The IRS has strict penalties for taxpayers who do not file and/or pay their tax returns. The two most common Civil Penalties are Failure to File (FTF) and Failure to Pay (FTP). If a taxpayer misses the deadline to file, they could be charged both penalties.
The worst thing you can do is ignore your tax obligations. No matter how late you are, file your taxes to avoid penalties. Even if you can’t afford to pay your taxes, you should always file a tax return. The penalty for Failure to File is much more than the Failure to Pay penalty.
Failure to File
When you fail to file your taxes by the deadline, the IRS will charge 5% of your unpaid taxes for every month you are late filing. The maximum penalty is 25%.
Failure to Pay
If you file your taxes on time, but fail to pay the amount you owe, the IRS will charge a penalty of .5% per month for the unpaid amount. This penalty caps at 25%.
These severe penalties add up quickly, leaving most taxpayers overwhelmed and unable to pay their penalties. Reach out to the professional tax attorneys at Wiggam Law to help you avoid or decrease your penalties.
Are You Facing an IRS Civil Penalty?
There’s nothing more frustrating than the penalties and interest charges that the IRS assesses if you are late to file or late to pay.
The high percentages of penalties add up quickly, and eventually seem impossible to overcome. They create daily stressors that impact your personal and professional life.
The tax attorneys at Wiggam Law are here to help you get penalty relief.
Here’s what you need to know about civil penalties.
What is an IRS Civil Penalty?
Civil penalties are most often monetary fines assessed if you do not file or pay your taxes. Extreme cases are given criminal penalties.
When the IRS assesses a civil penalty, you will be fined 5% for every month you are past due, up to five months after April 15th. The fines increase to 25% per month after five months. In addition, you will be charged a 1% late payment fee each month.
The interest charged on the overdue amount will continue to increase monthly as the balance owed increases each month.
How Long Can the IRS Collect Civil Penalty?
The IRS can attempt to collect a civil penalty for up to 10 years after the tax liability assessment has occurred.
How to Remove a Civil Penalty
While it seems like the IRS has a penalty attached to another penalty for every situation, they also offer a few different options for penalty relief that we can help guide you through.
Can IRS Civil Penalties be Waived?
Taxpayers who are assessed Failure To File and/or Failure To Pay penalties can request penalty abatement. The two most common options for abatement are:
Other penalties, such as accuracy and fraud, require audits and other IRS procedures to determine abatement.
Help with Back Taxes
Penalties and interest sometimes add up to such exorbitant amounts that they are impossible for the common taxpayer to pay off. However, our experienced tax attorneys can negotiate for complete penalty abatement or at least reduce the amount owed.
Negotiate with the IRS to Remove Penalties and Interest
There are many different strategies that our tax attorneys use to negotiate with the IRS and we are ready and willing to represent you in your unique situation. From penalty abatement and reduced penalties to removing liens and creating a payment plan, we can save you money, stress and time.
Success Stories
$29,570 Saved
The taxpayers owed for tax years 2014-2016 and the IRS had filed Federal Tax Liens against their real estate. We assisted the taxpayers with removing the liens from their property so it could sell. Additionally, we negotiated a penalty abatement with the IRS, which resulted in the taxpayers receiving a refund over $29,570 after the closing.
$359,078 Saved
Our client was suffering after their former employee embezzled the company’s payroll funds. Between the IRS and Georgia, our client owed a substantial amount. Our Penalty Abatement Requests saved our client $359,078 across their combined federal and state liabilities.
Contact Our Tax Attorneys in Atlanta, GA
Get started today! Our tax attorneys are here to help you get ahead of the game before you’re buried in penalties and interest. If you’ve already been charged with civil penalties, Wiggam Law tax attorneys can negotiate and represent you in your unique financial situation.