What it means
The entity return was filed late or was missing required information, and a penalty was assessed per owner per month.
Respond within
30 days from the date on the notice
What to send
Payment, or a written request for abatement citing first-time abatement or Rev. Proc. 84-35.
Write it
First-time penalty abatement request letter
When to get help
If the entity has many owners and several months of penalty, and neither relief path applies, get help.

What the letter says

The penalty is the base rate ($255 for returns due in 2026) times the number of partners or shareholders times the months late, up to twelve.

Relief

First-time abatement if the entity's prior three years were clean. For partnerships with ten or fewer individual partners who each filed on time, Rev. Proc. 84-35 presumes reasonable cause; say so in the request. Otherwise, reasonable cause on the facts.

Deadline

Respond by the date on the notice. Interest accrues on the penalty.

What to gather

  • The notice
  • Proof of when the return was filed
  • The entity's filing history for the prior three years
  • For 84-35: a list of partners and confirmation each filed on time

Write back

The First-time penalty abatement request letter tool builds the response in the order the IRS reads it. Fill it in, review it, print it, and send it with copies of the documents above and the notice stub on top.

Before you send anything

This is general information, not tax advice. Situations differ. Check with your tax advisor before you send anything. Nothing on this page creates a client relationship.

Sources

  1. IRS, Understanding your IRS notice or letter
  2. IRS, Failure to file penalty
  3. IRS, Administrative penalty relief
  4. IRS, Penalty relief for reasonable cause