Understanding The 843 Tax Form: How To Claim A Refund And Request An Abatement?

The 843 Tax Form, Claim for Refund and Request for Abatement, allows you to request a refund or abatement of certain taxes, interest, and penalties.

But what exactly is abatement?  Abatement in terms of taxes is either lowering or eliminating. In fact, you may request the Internal Revenue Service (IRS) to waive or seek reimbursement of particular interest, fines, taxes, and fees.

In this article, we will explain Form 843 and how to apply it to guarantee you don’t lose money that justly belongs to you.

What is the 843 Tax Form: Claim for Refund and Request for Abatement?

Individuals and companies fill out Form 843 to ask for a refund or reduction of particular taxes, interest, and penalties.

Although it could be appealing to believe you could reduce your whole tax liability or escape fines for not completing a return, usually this is not the case.

Form 843 can benefit your company, though, if you followed poor counsel or made a mistake. It guarantees that you only pay what you really owe.

Who Can File IRS Form 843?

You can file Form 843 for several reasons. One reason is that if your employer takes out too much income, Social Security, or Medicare tax from your paycheck, and does not correct it. You can also have someone authorized to act on your behalf file this form for you.

Another reason to utilize this form is if the IRS makes a mistake or takes too long. For example, if the IRS mistakenly charges you interest, fines, or extra taxes that you don’t owe, you can ask them to fix these errors by making a claim for a refund or reduction.

You normally need to file a separate 843 Tax Form for each form of tax or fee and for each tax year.

When Does A Company Use The Form 843?

Companies can make use of Form 843 for many purposes. The following are a few examples of how the form can prove helpful:

1. First-time penalty abatement: The IRS can waive the penalty through First-Time Abate Relief for you if you filed late or missed a payment, have a clean history of compliance, and qualify. This is only for penalties, not for taxes or interest.
2. Reasonable cause: In case you have been delayed for reasons beyond your control, such as a natural disaster or medical emergency, you can make a request for elimination of penalties using Form 843 based on reasonable cause.
3. Bad advice: To the extent you acted based on defective written advice, and you received a penalty for accuracy, you can get relief on Form 843. But you’ll have to prove that you made a good-faith effort to comply with the tax law.
4. Payroll tax problems: If payroll taxes have been improperly withheld from your wages and will not be fixed, you can file Form 843 for a refund or credit for FICA taxes, as well as for federal unemployment taxes.

Form 843 can also be used for issues other than income taxation, such as payroll taxes, gift taxes, and estate taxes, as well as information returns like W-2s and 1099s. Don’t lose track of it, you have three years from the filing of your return, or two years from the date of taxes paid, whichever is later, where you can make a request for refund or abatement. Subsequently, the IRS can deny your request.

Next, let’s go through how to complete Form 843 for higher chances of approval.

How Do I Fill Form 843: Claim for Refund and Request for Abatement?

Filling out Form 843 accurately provides you with the best chance of getting it processed and accepted. Here are step-by-step directions for finishing each section.

Section 1: Identifying Information

To fill out Form 843, start with your personal information.

1. Write your name and Social Security number, or your business’s legal name and employer identification number (EIN) for a business return.
2. Provide your current mailing address.
3. Include your daytime telephone number.

Section 2: Tax Period – Amount – Type of Tax and Penalty

To request a refund or abatement, first, write the tax year and the amount you want on lines 1 and 2. If you have many tax periods, fill out a separate abatement form for each one.

On line 3, describe the sort of tax you’re addressing, like income, payroll, or excise.   This helps the IRS submit your form to the correct department.

For line 4, include the type of penalty you received. You should write the part of the Internal Revenue Code found on the IRS notification you obtained. If you don’t have a notification, seek a tax professional for money-saving tips.

Section 3: Claim Information

On line 5a, check the box to explain why you should get a refund or abatement. If you have already paid the penalty, interest, or fee, write the payment date on line 5b.

On line 6, write the form that applies to your request.

Section 4: Explanation

Clearly explain your claim, including specific laws or situations that support it. The more details you provide, the better the IRS can evaluate your request. Feel free to attach additional information if needed.

Include relevant documents, such as notices or communications from authorities, along with any supporting materials. For instance, if requesting a penalty waiver due to hurricane damage, provide copies of insurance claims to demonstrate your loss.

Section 5: Signature

Sign and date the form. If you are filing a joint return, your spouse also needs to sign and date it. If an accountant or attorney fills it out for you, they should include their information in the Paid Preparer section.