You are able to request penalty relief. The most common is the First Time Abate process with the IRS. To qualify, generally you must have what is considered a history of good tax compliance. The IRS defines this as:
- Filed the same return type, if required, for the past 3 tax years before the tax year you received the penalty.
- Didn't receive any penalties during the prior 3 years, or any penalty was removed for an acceptable reason other than First Time Abate
Generally, to apply, you can call the number on the IRS notice you received relating to the penalty.
More information about IRS Administrative Penalty Relief (including First Time Abate) is available here: IRS Administrative Penalty Relief
Interest rates are adjusted each quarter and are set per federal law. Current and past interest rates and how they are calculated is available on the IRS website here: IRS Quarterly Interest Rates
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