First-Time Abatement in Billings MT How to Use It

First-Time Abatement in Billings, MT – How to Use It?

The FTA or First-time Penalty Abatement waiver is a penalty relief offered by the IRS in Billings, MT to taxpayers against the penalty imposed for failing to file returns, failing to pay tax, and failing to deposit penalties. However, the relief is not offered universally, and the taxpayers must fulfill specific criteria to claim abatement. The policy is designed to facilitate taxpayers with a good compliance history and encourage further mistakes as relief will be available only for one time.  

FTS is not valid for the penalties such as wrongful filing. Wrongful filing of return is mostly intentional and done with intentions of misleading IRS, which triggers IRS investigation against the filer. If such a taxpayer qualifies for FTA, the examination or criminal investigation against them will have to stop.

Requirements To Qualify For Administrative Relief From Penalties Under First-Time Penalty Abatement Policy In Billings, MT Are Following:

  • You haven’t failed to file returns for the last three years prior to the year for which you received the penalty, or you were not required to file the return before the penalty year. 
  • You filed all the returns required by IRS or requested an extension of time to file.
  • You are willing to pay or have already paid any taxes due.

These basic rules are enough in most cases to claim and enjoy the first time abatement. However, the IRS deals with the FTA differently than the taxpayers do. They have a different interpretation of each and everything, which may confuse the client. 

Thankfully, the IRS isn’t a final authority on tax matters, and taxpayers can always appeal the IRS verdict in court or against the appellate tribunal. An important thing here to understand is that the penalty is the additional money you have to pay the IRS against the unpaid taxes. So if you get it for the first-time abatement relief and don’t pay the tax accrued, the IRS can again penalize you again and again till the tax is paid in full. 

You cannot claim this relief twice as it is only for the “first time.” 

Situations or Taxes, Where FTA Doesn’t Apply:

Let’s look at cases similar to those where FTA is approved, but it doesn’t really apply to them also.

  • Failure to file or Failure to pay tax was intentional and deliberate. If the IRS proves that you were capable of filing or paying on time but didn’t do so, they reject the FTA claim. 
  • Gift tax returns and Estate taxes don’t qualify for FTS. 

Things to Remember:

In order to do your FTA right, you need to keep a few points in your mind. 

  • You can request FTA by contacting IRS Practitioner Priority Service (PPS) via phone. If the case is handled by a specific IRS unit, then you need to contact that unit to apply for FTA relief. It is the most useful way to avail FTA as the abatement is usually granted over a phone call. 
  • You can also request FTA via mail.
  • If you already have paid the penalty and come to know about this relief later, you can request a refund of the rebate.
  • The interest on penalty also reduces or removed once the penalty is lifted. 

To summarize this, we advise you to pay taxes on time, and if you fail to do so, you can claim relief under the First-time abatement policy for failing to file, failing to pay tax, or failing to pay penalties – Contact USA Tax Settlement for the professional and timely help. 

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If you need IRS Tax Relief in Billings, MT then call USA Tax
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