Didn't file your taxes on time?

Tax Tip of the Week
April 26, 2010

Penalty abatement may be possible. Sometimes you can't help doing what you'll have to find an excuse for later.

If one of those actions is filing your tax return after the due date, your explanation will have to be good enough to convince the IRS to abate the resulting penalties. Fortunately, the IRS will consider "reasonable cause" in most cases.

What qualifies as reasonable cause? In general, when you fail to file a return on time, reasonable cause for the lapse is defined as "ordinary business care and prudence." That means you did your best to comply with your tax responsibilities, but you were unable to do so because of circumstances beyond your control.

Examples of reasonable cause include serious illness, natural disasters, loss of your records, and casualties that affect your ability to file on time.

Suppose you just made a mistake? You may still be able to qualify for penalty abatement under the reasonable cause exception. You'll want to show you acted to correct your mistake as soon as you discovered it and that your error was an unusual event and not a willful act.

Please call if you receive a penalty notice from the IRS. We can help you apply for relief.

Questions for our Financial Expert?
E-Mail us at: qa@ClevelandSeniors.Com