IRS Form 843 is a written request asking the government to waive certain penalties charged to taxpayers. These include penalties for failure to pay, failure to file, and the failure of employers to make tax deposits as required by law. This provision for forgiveness has been in place since 2001. Form 843 can also be used to request a refund of certain assessed taxes.
The waiver is considered to be a reward for complying with your tax obligations on time in the past. Your request can be denied if you don’t have a clean tax record or you don’t meet certain rules.
Definition and Examples of Form 843
Form 843 is the “Claim for Refund and Request for Abatement.” It asks the Internal Revenue Service (IRS) for administrative relief from certain tax penalties under the terms of its First Time Penalty Abatement policy. “Administrative” here means this tax rule isn’t provided for by statute or by law. It's left to the discretion of the IRS.
Eligible penalties include not filing your tax return on time, not paying the tax due, or not depositing required taxes with the government.
You must qualify for the waiver, which means:
- You can’t have had any penalties in the last three years if you were required to file a return during that time.
- You have submitted all returns that you have been required to file or you’ve filed for an extension of time to do so.
- You’ve either paid or made arrangements to pay any taxes you owe the IRS.
Your penalty and any resulting interest will be erased if your request is approved, but interest will continue to accrue until your balance is either erased or paid. Your interest will be reduced if your penalty is reduced.
You might also qualify if you’ve received incorrect advice from the IRS or if your penalty was the result of an IRS error or delay.
Let's say you failed to file your 2020 tax return on time. The monthly failure-to-file penalty is 5% of the tax that ends up being due on that return, up to 25% total. You or your tax professional can file Form 843 to ask the IRS to waive or reduce this penalty if your tax record has otherwise been spotless.
Who Uses Form 843?
Form 843 can be used by taxpayers requesting one of the following:
- A refund of certain assessed taxes
- An abatement of FICA or excise taxes
- A refund of a branded prescription drug fee
- A waiver of the failure-to-file, failure-to-pay, or failure-to-deposit penalties
This form can't be used to request a refund of overpayment of FICA or Railroad Retirement Tax Act (RRTA) due to erroneous withholding. However, you might qualify for a refund of these taxes if your employer refuses to adjust your withholding to arrive at the correct amount. Speak with a tax professional if this is the case.
Nor can Form 843 be used to request a refund for gift tax overpayment, estate tax overpayment, the Additional Medicare Tax, or excise taxes resulting from nontaxable fuels. You can't use it to ask for a refund of offer-in-compromise or lien fees.
The IRS provides a detailed complete list on its website of all taxes and fees that apply to Form 843, and the form itself includes instructions as to when it can and cannot be used.
Where To Get Form 843
The IRS provides an interactive Form 843 on its website. You can complete it online and then print it out, or you can print it out and then fill it in by hand.
How To Fill Out Form 843
IRS Form 843 begins with a section for your identifying information: names, addresses, and Social Security numbers for you and your spouse, as well as a daytime phone number. Employers who are filing must provide their employer identification number. Each line is on the form is clearly labeled, as you'll see below.
- Line 1: Identify the tax year you’re asking the IRS to review.
- Line 2: Enter the amount you want to be refunded or abated.
- Line 3: Identify the type of tax.
- Line 4: Cite the type of penalty you’re dealing with if you’re filing the form for this reason. You’ll have to include the appropriate Internal Revenue Code section. This information is provided in the instructions.
- Line 5a: Identify the reason you’re asking for relief. You can simply check the box that applies, or you can skip this section if none of the provided answers adequately explains your situation.
- Line 5b: Enter the dates of any tax payments you made that you’re asking to be refunded if this is the reason you're filing.
- Line 6: Identify the type of tax return you filed.
- Line 7: Explain why you’re filing the form and asking for relief. You can attach extra pages if there isn’t enough room here.
You (and your spouse if you’re married and filing a joint tax return) must then sign the form under penalty of perjury. The very bottom of the form is reserved for your tax professional’s signature and information if you decide to hire someone to assist you with your situation.
Filing Form 843 by letter or phone is sometimes an option for first-time penalty abatements. Have your tax preparer contact the IRS Practitioner Priority Service (PPS) to make this request.
Can Form 843 Be E-Filed?
The IRS provides no instructions for e-filing Form 843.
Where To Mail Form 843
Mail your Form 843 to the address cited in any notice you received that assessed a penalty fee. Send it to the IRS service center where you would normally mail your tax return if no notice is provided or if you're filing due to reasons other than penalty abatement.
There are special addresses to use if you’re requesting abatement of a branded prescription drug fee, or if you’re filing on behalf of an estate. The IRS provides a full list of these in the instructions for Form 843.
Requirements for Filing Form 843
Filing Form 843 is a relatively simple matter of mailing in the completed form unless you’re dealing with an excise tax. In that case, you would also have to file Form 4720. The IRS provides detailed instructions for this form on its website, as well.
- Form 843 is an official request for the IRS to waive certain penalty fees. These could be for failure to file a return, failure to pay the tax due on a return, or failure of an employer to make tax deposits with the IRS.
- The form can also be used to ask for a refund of some assessed taxes.
- This help is only provided to those who have a good record of filing and payments with the IRS.
- There is also the option of submitting a letter to the IRS or making your request by telephone.