If you have been hit with IRS penalties, you may be wondering how long it will take for the IRS to review a request for relief.
The penalty abatement process can be lengthy, and the timeline often depends on your circumstances and the IRS’s workload.
While no two cases are identical, understanding the typical stages of review can help you prepare and manage expectations.
Step 1: Submitting the Request
The first step is preparing and submitting your request. Taxpayers typically use Form 843 (Claim for Refund and Request for Abatement) or include a detailed letter explaining reasonable cause.
At this point, you are expected to provide supporting documentation, such as medical records, proof of natural disasters, or evidence of reliance on professional advice.
Once the request is filed, it enters the IRS system for initial review.
This step alone can take 30 to 60 days, depending on how the request is submitted and whether it is routed to the correct department.
Step 2: IRS Review Period
The IRS then evaluates your request to determine whether your situation meets the standards for penalty relief.
During this time, an examiner may:
- Verify the facts and supporting evidence.
- Request additional documentation.
- Compare your case against IRS reasonable cause guidelines.
For straightforward cases with strong evidence, decisions are often made within two to four months.
For more complex cases — such as requests involving multiple tax years, large penalties, or incomplete records — the review can extend to six months or more.
Step 3: Final Determination
In many cases, the IRS issues a determination letter within six to nine months of the original submission.
This letter will either approve, partially approve, or deny your request.
If denied, the IRS typically explains why the reasonable cause standard was not met.
It is important to note that the penalty abatement timeline can be longer if the IRS is experiencing backlogs.
For example, during the pandemic, many taxpayers waited a year or more for responses.
It’s important to note that while delays have improved, processing times still vary.
Appeals and Additional Delays
If your request is denied, you have the right to appeal. The IRS Independent Office of Appeals reviews contested cases, which can add several more months to the process.
Appeals may be resolved by written correspondence, phone, or a conference.
This step extends the overall timeline but provides another opportunity to argue for relief.
What Affects the Timeline?
The IRS penalty abatement process time depends on:
- Completeness of your request: Well-documented claims move faster.
- IRS workload: Backlogs can extend processing times.
- Complexity of your case: Multiple tax years or higher penalty amounts often require more scrutiny.
- Response time: If the IRS requests additional records, delays occur if taxpayers do not respond quickly.
How This Fits With Previous Blogs
In our earlier blog, How to Reduce or Remove IRS Penalties and Interest on Tax Debt, we explained the different options available to taxpayers seeking relief. This blog builds on that by clarifying how long the IRS usually takes to make a decision.
In our next post, How to Fight an IRS “Accuracy-Related” Tax Penalty, we’ll take a closer look at one of the most common penalties and the specific defenses available to challenge it.
Key Takeaway
Most taxpayers should expect the penalty abatement process to take several months, with simple cases resolved in as little as two months and complex or appealed cases taking six to nine months or longer.
The best way to avoid delays is to provide thorough documentation from the start and respond quickly to any follow-up requests from the IRS.
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