Abatement of Interest and Penalties
Expand Authority to Abate Interest
Permits abatement of interest for any unreasonable error or delay by the IRS for managerial acts in addition to ministerial acts such as:
- loss of records by IRS;
- IRS personnel transfers;
- extended illnesses;
- extended personnel training; or
- extended leave.
Effective for taxable years beginning after the date of enactment.
Review of IRS Failure to Abate Interest
Grants the Tax Court jurisdiction over whether the IRS's failure to
abate interest was an abuse of discretion.
An eligible taxpayer must meet certain net worth and size
requirements (i.e. those with respect to awards of attorney fees).
The taxpayer must be eligible for the abatement and must bring the
action within 180 days after the IRS mails its final determination.
Effective for abatement requests after the date of enactment.
Extension of Interest-Free Period
Extends the interest-free payment period for tax liabilities from 10
calendar days after notice and demand for payment to:
- 10 business days on accounts $100,000 and over, and
- 21 calendar days on accounts under $100,000.
Effective for notices issued after 12-31-96.
