Donna Genie walks through the IRS First Time Penalty Abatement program, which lets eligible taxpayers get penalties refunded. She covers the three eligibility requirements, how to pull your IRS transcript, and how to call the IRS to request the abatement. One client recovered about $8,000 this way.
The IRS might owe you thousands of dollars right now, and they're counting on you to never ask for it back. Now, I'm not talking about some sketchy loophole. I'm talking about a legitimate IRS program called the First Time Penalty Abatement. It refunds penalty monies if you meet 3 specific criterias. And here's the kicker: the IRS will not tell you about it. They only process it when you know to request it. I just recovered over $8,000 for 2 clients by reviewing their transcripts and making a phone call to the IRS. In the next few minutes, I will show you what this program is, the 3 conditions to qualify, and the exact steps to get your money back. First Time Penalty Abatement is an IRS Administrative Waiver. It's not a loophole. It's a built-in relief program for taxpayers with good compliance history. The IRS charges penalties for failure to file, failure to pay, accuracy issues, and estimated taxes. These add up fast, and most people assume that once a penalty is assessed, it's final. That's not correct. If you meet the criteria, those penalties can be fully refunded. Not reduced, not negotiated, fully refunded. But you have to ask. Now, before I give you the 3 qualifications, if you've paid IRS penalties in the last few years and want us to review your transcripts and tell you exactly what you can recover, schedule a discovery call with us. That is something we do normally for all of our clients. Link is right below in this video, and that's exactly how we found that $8,000. Now, the 3 qualifications. You need all 3, not 2 out of the 3. First, a clean tax record for the 3 years before the penalty year. So that means no penalties assessed during that time. Second, all required tax returns have been filed. If you're missing filings, even for years without penalties, you don't qualify. Third, you are current on your tax payments or have arrangements in place. You do not have to be paid off completely, but you can't be ignoring what you owe. Now, if you meet all three of these, you're eligible, and here's the process. So step one, check if you qualify. Pull your IRS account transcripts for free on IRS.gov. They show your filing history, payment history, and every penalty assessed on your account. Look at the last few years for penalty charges. If you see them, verify you meet those 3 conditions. Most tax preparers never even look at this. They file your return, you pay what the IRS says, and that's it. This is where you actually recover money. Step 2: Gather your documentation. Have your Social Security number or EIN if it's a business, your transcripts pulled up and the specific years and penalty amounts in front of you. The IRS will not walk you through this. You need to know what you're asking for. Step 3: Get your patience on and call the IRS. Request it. You can't do this online. You have to call and specifically say, "I am requesting First Time Penalty Abatement." They run your information through an automated verification system, and if you qualify, they process it right there on spot, and within a few weeks, you'll get your refund check for the penalties that you already paid. It's not a judgment call by whoever answers the phone. If you qualify, you get the refund. But you have to ask. Here's why this matters more than you think. Failure to file penalties alone run 5% per month up to 25% of the unpaid taxes. Add in failure to pay and estimated tax penalties, and suddenly you're out thousands on top of that actual tax bill. Most business owners assume this is just the cost of the mistake. But if it is your first offense and you have been compliant otherwise, you don't have to eat it. This is money you already paid sitting in the IRS system waiting for you to claim it. So review your transcripts at least once a year. Look for the penalties. Check for the 3 conditions. And if your tax preparer is not doing this for you, Ask them why not. If you've paid the IRS penalties and think you might qualify, schedule a discovery call with us using the link below, and we'll review your transcripts and show you exactly what you can get back, just like we did for those other two clients that saved $8,000.
