IRS Penalty Relief 2024: For 4.7 million taxpayers and organizations that ignored automated collection notices during the pandemic, the IRS is offering $1 billion in penalty relief. To learn more, scroll down.
In today’s article, you will get to know about IRS Penalty Relief 2024 – Who is going to get its benefits and when. You will get complete information about it. However, read the entire article in full. Then let’s start this article.
IRS Penalty Relief
Millions of people who are behind on their taxes can get assistance from the IRS. They’ll waive penalties for 5 million returns in an effort to make up for those that were missed during the pandemic, saving taxpayers a total of $1 billion.
This equates to $206 on average for each return, with people making less than $400,000 profiting the most.
Who is not Eligible for Automatic Relief?
- taxpayers whose assessed taxes for any given year exceed $100,000.
- those who were not served with an initial notice of balance due within the allotted time frame, or who are not in the IRS collection notice process.
- taxpayers subject to penalties besides the failure-to-pay fine.
Alternative Options for Ineligible Taxpayers:
- Applying for penalty relief is still possible through the “reasonable cause” and “First-Time Abate” programs, among other current procedures.
- Investigate different ways to pay and web resources to help you handle your tax debt.
- If you require assistance, get in touch with the IRS or a tax expert.
Eligibility for IRS Penalty Relief
Basic Criteria:
- For the 2020 or 2021 tax years, you submitted a tax return (Forms 1040, 1120,1041, or 990-T).
- Every applicable year, your assessed tax is less than $100,000.
- Between February 5, 2022, and December 7, 2023, you either received an initial balance due notice or were enrolled in the IRS collection notice process.
- The $100,000 cap is applied differently to every entity (individual, business, etc.) and every return.
- This relief is only applicable to penalties for failure to pay; it does not apply to penalties for failure to file.
- To get this relief, you don’t have to do anything.
- You will receive a refund or credit even if you have already paid the failure-to-pay penalty.
How to apply for IRS Penalty Relief?
- Qualifications: Verify whether you satisfy the requirements listed in my earlier reply (filed tax return, assessed tax less than $100,000 annually, within the allotted period).
- Changes will be made automatically by the IRS beginning in December 2023 for eligible individual accounts, late December or early January for business accounts, and late February or early March 2024 for trusts, estates, and exemptions.
- Return or credit: The IRS will automatically issue a refund or credit your payment toward another outstanding tax liability if you have already paid the failure-to-pay penalty for 2020 or 2021.
IRS Penalty Relief for 2020 and 2021:
- Taxpayers stand to save $1 billion as a result of the automatic penalty relief available on 5 million tax returns—filed by 4.7 million individuals, businesses, etc.
- This pertains to individuals who have assessed taxes under $100,000 and who, between February 5, 2022, and December 7, 2023, were either notified of an initial balance due or were in the IRS collection notice process.
- Almost 70% of individual recipients make less than $100,000 per year.
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