A first time penalty abatement sample letter is a short written request asking the IRS to remove a failure-to-file, failure-to-pay, or failure-to-deposit penalty based on your clean compliance record over the previous three tax years. It needs to identify you, reference the specific penalty notice, and state that you meet the IRS eligibility criteria. Keep it brief. The IRS employee reviewing your request is checking boxes against a rule, not reading an essay.
Sample Letter You Can Copy
[Your Name]
[Your Address]
[City, State, ZIP]
[Date]
Department of the Treasury
Internal Revenue Service
[Address from Your Notice]
Re: Request for First Time Penalty Abatement
Taxpayer ID: [SSN or EIN]
Tax Year: [Year]
Notice Number: [Notice Number]
To Whom It May Concern:
I am requesting removal of the [failure to file / failure to pay] penalty of [dollar amount] assessed for the [tax year] tax period. I am requesting this relief under the IRS First Time Abatement policy.
I meet the eligibility requirements for this relief. I have no penalties on my account for the three tax years before this period. I have filed all required returns and have [paid the tax owed in full / entered into an installment agreement for the balance due].
In the alternative, if I do not qualify for First Time Abatement, I respectfully request penalty relief based on reasonable cause. [Add one or two factual sentences here if applicable — see below.]
Please remove the penalty from my account and send written confirmation once the adjustment is processed. Thank you for your time.
Sincerely,
[Signature]
[Printed Name]
[Phone Number]
What to Pull from Your Penalty Notice
Before you fill in the blanks, have your IRS notice in front of you. Common notices that assess these penalties include the CP14 (initial balance due) and the CP501 (payment reminder).
- Your taxpayer ID: Social Security Number or Employer Identification Number.
- Notice number: printed on the notice, usually in the upper right corner.
- Tax year: the specific period the penalty covers.
- Penalty type and amount: whether it is a failure-to-file or failure-to-pay penalty, and the exact dollar figure.
- IRS mailing address: printed on the notice. This is where your letter goes.
Confirm You Actually Qualify
First Time Abatement covers only three penalties: failure to file, failure to pay, and failure to deposit (the last one applies to businesses that miss employment tax deposits). It does not cover accuracy-related penalties, estimated tax penalties, the daily delinquency penalty for exempt organizations, or event-based filing penalties. If your notice is for underreported income or an incorrect deduction, this letter is not the right tool.1Internal Revenue Service. Administrative Penalty Relief
The IRS applies three conditions, all of which must be met:2Internal Revenue Service. Internal Revenue Manual 20.1.1 – Introduction and Penalty Relief
- No significant penalties on your account for the same type of return during the three tax years before the penalty year. Estimated tax penalties in that window do not count against you.
- You have filed every required return, or have a valid extension for any return not yet due.
- You have paid the tax owed or set up an installment agreement. A payment plan qualifies; you do not need to be paid in full.1Internal Revenue Service. Administrative Penalty Relief
One trap in the look-back: if you had a penalty during those three years that was later removed for any reason other than First Time Abatement, it still counts against you.2Internal Revenue Service. Internal Revenue Manual 20.1.1 – Introduction and Penalty Relief If you are not sure what is on your record, request an IRS account transcript before you send the letter.
Add a Reasonable Cause Fallback
The reasonable cause paragraph in the template is not filler. The IRS is required to consider First Time Abatement before reasonable cause, so if the reviewer finds a disqualifying penalty in your history, they can move straight to your reasonable cause argument without making you file a second request.2Internal Revenue Service. Internal Revenue Manual 20.1.1 – Introduction and Penalty Relief
Reasonable cause means you exercised ordinary care but could not comply due to circumstances beyond your control. The IRS recognizes situations such as:3Internal Revenue Service. Penalty Relief for Reasonable Cause
- A fire, natural disaster, or civil disturbance that destroyed records
- Serious illness, death, or unavoidable absence of you or an immediate family member
- Inability to obtain necessary records
- System issues that prevented timely electronic filing or payment
If any of these apply, replace the bracketed line in the template with a short factual account: what happened, when it happened, and how it prevented you from filing or paying on time. Keep it specific. If none apply, delete the alternative paragraph and send the FTA request on its own.
You Can Call Instead of Writing
The IRS accepts First Time Abatement requests by phone. Call the toll-free number on your notice, have the notice in front of you, and tell the agent you are requesting First Time Abatement. The agent can check your compliance history and approve or deny the request during the call.4Internal Revenue Service. Penalty Relief For most individual taxpayers this is the fastest route; many get a resolution in one call.
If the agent cannot approve over the phone, they will ask for a written request, either a letter like the template above or Form 843 (Claim for Refund and Request for Abatement).4Internal Revenue Service. Penalty Relief Form 843 collects the same information the letter does. Follow the instructions on your notice for where to send it.5Internal Revenue Service. Instructions for Form 843
Mailing the Letter
Send the letter to the address on your penalty notice. Certified mail with a return receipt gives you a tracking number and proof of delivery, which matters if the IRS later says it never arrived. Most taxpayers hear back within 30 to 60 days. If the request is approved, the IRS mails a notice confirming that the penalty has been removed.
What About the Interest
When the IRS removes a penalty, it also reduces or removes the interest that had accrued on that penalty amount.4Internal Revenue Service. Penalty Relief Interest on the underlying unpaid tax, though, stays. The law requires the IRS to charge interest on tax underpayments regardless of whether penalties are abated.1Internal Revenue Service. Administrative Penalty Relief Plan to pay the tax down as quickly as you can, whether or not your abatement is granted.
If the IRS Denies Your Request
A denial letter explains why you did not qualify and outlines your appeal rights. You generally have 30 days from the date of the rejection letter to request an appeal with the IRS Independent Office of Appeals, but check the letter itself for the exact deadline. Include a detailed factual explanation with your appeal.6Internal Revenue Service. Penalty Appeal The most common reason for a denial is a forgotten penalty in the three-year look-back window; if that is what tripped you up, shift your argument to reasonable cause on appeal and pull your account transcript so you know exactly what the IRS sees on your record.