Penalty Appeal

[catax]

I am writing my first Penalty Appeal letter. I am looking for someone that has had experience with this. The penalties I am trying to get waived are Delinquency Penalty and the Failure to Pay penalty for a 2005 Tax Return.

Facts and Circumstances: Taxpayer deceased March 20, 2006. I took until 9/5/06 for son to be appointed administrator of the estate by the courts. The taxpayers son then filled form 56 with the IRS which did not receive a rsponse til October 16th. There were several foreign accounts that took time to find and be authorized to gain access to the data. All paperwork was finally put together to file a return in the middle of December. Client was not able to get an appointment with a tax professional until early January. Everyone was on vacation. Once a taxprofessional was located (myself) there were a few more items needed to prepare the return accurately. Once those were located the return was filed. The date it was received by the IRS (it was mailed) was Februrary 23rd it included full payment.

Question 1: Do you think we have a case worth appealing?

Question 2: How do you suggest that I go about researching tax law to back up my position? I currently do not have a subscription to any research program.

Any feedback would be appreciated.

Thanks, Nena

[OutWestTax]

Here's where to start. You're looking for a reasonable cause exception. Goto this link which is the penalty section of the IRS manual, you'll get a lot of information on your chances straight from the horses mouth. If you see a way, write the request knowing what the Service wants.

http://www.irs.gov/irm/part20/index.html

Doug

[OldJack]

Your "Facts and Circumstances" as stated should result in a waiver of penalties. Not sure I would mention the tax pro or his time involved. I would have stopped before the sentence "All paperwork was finally put together". That sentence and all after just sounds like an excuse and brings up questions of how long it took which the IRS might not agree. Remember, the IRS is not smarter than a 5th grader.

[jainen]

>>I would have stopped before the sentence "All paperwork was finally put together".<<

I would have continued slightly beyond that, but still kept it extremely brief. You have an excellent reasonable cause if you don't clutter it up with too many other excuses. The dates are important because they prove that a) the taxpayer couldn't file on time because of death, - the estate could not gather information or file until approved, c) there was only a short time in getting professional assistance, and (d) the return was filed and payment was made as soon as possible.

All penalties should be abated, but the IRS can not waive interest.