USTaxPenaltySaverWhat Is First-Time Abatement?
First-Time Abatement (FTA) is an IRS administrative waiver that allows taxpayers with a clean compliance history to have their first penalty removed without providing a reason. It was established under IRM 20.1.1.3.3.2.1 and remains one of the most frequently used and most successful penalty relief provisions.
Unlike Reasonable Cause, FTA does not require you to explain why the penalty occurred. You simply need to show that you have been compliant for the prior 3 tax years. This makes it the easiest and fastest form of penalty relief available.
FTA can save taxpayers hundreds to thousands of dollars. For example, on a $10,000 tax balance, the failure-to-file penalty alone can reach $2,500 (25% maximum), and the failure-to-pay penalty can add another $2,500 over time. FTA can eliminate these penalties entirely.
FTA Eligibility Requirements in 2026
Requirement 1 - Clean compliance history: You must not have had any penalties (under IRC 6651 or 6656) assessed in the prior 3 tax years. For example, if you are requesting FTA for your 2025 tax year, the IRS will look at tax years 2022, 2023, and 2024 for any penalties.
Requirement 2 - All required returns filed: You must have filed all required tax returns or filed a valid extension. If you have unfiled returns for any year, you do not qualify for FTA until those returns are filed.
Requirement 3 - Tax paid or arrangement to pay: You must have paid the tax owed (or at least be on an approved installment agreement or other payment arrangement). FTA removes the penalty but does not eliminate your obligation to pay the underlying tax.
Estimated tax penalties (IRC 6654 for individuals, IRC 6655 for corporations) do not count in the 3-year lookback. If the only penalty on your record is an estimated tax penalty, you still qualify for FTA.
Which Penalties Are Covered
FTA covers three specific penalty types: Failure-to-File (5% per month, up to 25% of unpaid tax under IRC 6651(a)(1)), Failure-to-Pay (0.5% per month, up to 25% of unpaid tax under IRC 6651(a)(2)), and Failure-to-Deposit (2-15% of the deposit amount under IRC 6656, for employer tax deposits).
FTA does NOT cover: accuracy-related penalties (IRC 6662), fraud penalties (IRC 6663), estimated tax penalties (IRC 6654/6655), international information return penalties (IRC 6038, 6038A, 6677), information return penalties (IRC 6721/6722), or any other penalty type.
If you have both a failure-to-file and failure-to-pay penalty for the same tax year, FTA can remove both with a single request. This is important because the combined penalty can be substantial on larger tax balances.
How to Request FTA in 2026
By Phone (Fastest): Call 800-829-1040 for individual tax issues or 800-829-4933 for business tax issues. Navigate through the menu to reach a representative, and say you would like to request First-Time Abatement for tax year [year]. Have your SSN or EIN, the tax year, and the notice number ready.
The IRS representative will check your account in real-time. If you meet all three requirements, they can approve FTA immediately during the call. You will see the penalty removed from your account within 1-2 weeks. Best call times: Tuesday through Thursday, 7am-9am your local time.
By Mail (Form 843): If you prefer written communication, download Form 843 from IRS.gov. In Section 5, select the reason for your claim, and write First-Time Abatement under IRM 20.1.1.3.3.2.1 in the explanation. Mail it to the IRS service center for your state. Processing takes 2-4 months.
By Letter: You can also write a simple letter requesting FTA. Include your name, address, SSN, the tax year, penalty type and amount, and a statement that you qualify for First-Time Abatement based on a clean 3-year compliance history. Our FTA eligibility checker generates this letter for you.
What to Do If FTA Was Not Applied or Is Denied
If you believe you qualify for FTA but it was not applied, the most common reasons are: a penalty exists in the prior 3 years that you may not be aware of, an unfiled return, or the tax year is not eligible. Check your IRS account transcript to verify your penalty history.
If FTA is denied but you believe you qualify, request a detailed explanation. You can also request Reasonable Cause relief as an alternative. Having both options available makes it more likely you will get some form of relief.
For tax years 2024 and earlier, you must still make a manual request for FTA. Check our eligibility tool to verify your compliance history and generate the appropriate request letter or phone script.
Strategic Use of FTA
Since FTA requires a 3-year clean history, timing matters. If you have penalties for multiple tax years, apply FTA to the oldest year first. This maximizes your relief because it is the oldest penalty that determines whether you qualify for subsequent years.
Consider whether to use FTA now or save it. If you have a small penalty this year but anticipate a potentially larger penalty situation next year, it may be worth using Reasonable Cause for the current year and saving FTA for the larger penalty. However, this requires careful planning because you cannot predict the future with certainty.
Remember that FTA becomes available again after 3 consecutive clean years. If you received FTA in 2023, maintained clean compliance in 2024, 2025, and 2026, you would be eligible for FTA again for tax year 2027.