The Top 5 Tax Secrets The IRS Doesn’t Want You To Know – Part 2
TAX SECRET #2
DO NOT PAY IRS PENALTIES!
The IRS has close to 200 different types of penalties, and they like to hand them out like a salesman does his business card. The worst part is that the IRS also charges interest and additional penalties on the original penalty. (This is where the big bucks pile up!)
TIP: Always try and get all penalties reduced or completely abated.
It makes sense (in almost every case) to request penalty abatement before you pay the IRS. If you have already paid the bill, it will not hurt to ask for penalty abatement and refund. Remember: Your chances of getting a rebate is greatly reduced after you have paid the IRS.
These penalties can, however, be reduced to ZERO if you have “REASONABLE CAUSE”. What makes up REASONABLE CAUSE you ask? Well, in my experience in negotiations with the IRS, anything may qualify as long as it is reasonable.
I’ve seen the IRS abate penalties for medical reasons, bad accountants, ignorance of the tax laws, ex-spouses, helping to provide care for a loved one, military call-ups, fire, floods, alcoholism, drug abuse, death, and even for relying on IRS advice. (Did you know the IRS gives out the wrong tax advice over the phone almost 40% of the time?)
Penalties can be such a high percentage of the total amount owing to the IRS; it usually makes sense to consider requesting the IRS to reduce all penalties to Zero.
YOU MAY BE PLEASANTLY SURPRISED YOU HAVE NOTHING TO LOSE AND THE SAVING COULD BE HUGE!
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Tags: IRS, Tax Advice, Tax Secrets, Taxes
