Other sanctions are proposed during IRS audits and investigations, such as. B accuracy or penalties for fraud, and generally require the taxpayer to negotiate with irs auditors or appeals agents before assessing the penalty. After assessment, taxpayers can request penalties for the accuracy of the restitution, but the mitigation process may require the use of special IRS procedures or the transfer of the IRS to court – all of this can take years. According to TIGTA, for fiscal year 2010, the average individual reduction in non-deposits used under the free trade agreement was $240 and the average reduction in non-payment was $84. However, more than 90% of people who qualified for a free trade agreement did not get the waiver for 2010. 7 This is probably due to the fact that taxable persons did not know that they could apply for it. The IRS does not publish the FTA as a discharge option on its criminal communications or on its website. 8 If the taxpayer or practitioner calls or writes to the IRS to request an FTA, the IRS assesses the application using an automated tool. In order to uniformly apply the sanctions, the IRS has developed a decision support software called reasonable cause assistant (RCA). The program was designed to help IRS staff make relief findings for individuals (non-deposits and non-payment) and businesses (non-payment penalty). The IRS requires its collaborators to use this program to make decisions on requests for reduced sentences, including free trade agreement applications. 31 That letter adapts the penalty for non-payment.
It statees that the mitigation measures were taken exclusively on the basis that the taxable person has a good history of timely deposit and payment, that the reduction is a single consideration and that all future decisions to adopt sanctions will be taken on the basis of reasonable criteria. 19 See IRM § 188.8.131.52 for taxation procedures which stipulate that the body responsible for imposing the sanction should decide whether the sanction should be annulled. Taxpayers must withhold their salaries adequately and/or pay estimated taxes fairly throughout the year. If this is not the case, the IRS can impose the estimated tax fine, commonly known as the penalty of underpayment. That`s why, 12 years ago, the IRS created the first Administrative Sanctions Waiver (FTA)2, which typically allows compliant individuals and businesses to request the reduction or cancellation of certain sentences first imposed by the IRS. Indeed, the IRS typically rewards compliant taxpayers with a single punitive amnesty that can save the taxpayer hundreds – sometimes thousands of dollars. To ensure consistency in all requests for sentence reduction, the IRS needs to develop a more consistent directive to address errors caused by reliance on its CAB and to train assigned staff to reconsider requests for sentence reduction. In 2011, IRSAC recommended to the small business/self-employed subgroup that the IRS develop a clear sentence reduction request form, which would help taxpayers assess their circumstances based on sentence reduction criteria, including the FTA.
This form would eliminate confusion as to how a reduction in penalties could be requested, define the criteria for the cancellation of sanctions, and promote fairness and consistency. . . .