First-Time Abatement (FTA): the penalty forgiveness most people never request
FTA removes failure-to-file/failure-to-pay penalties if the prior 3 years were clean. Eligibility criteria, what it doesn't do (interest), and how to request it.
Updated 2026-09 · rules as of 2026-09
What FTA is
First-Time Abatement is an administrative waiver the IRS applies to certain penalties — failure-to-file, failure-to-pay, and failure-to-deposit — for taxpayers with a clean recent history. It is genuinely automatic in one sense: if you call and ask, the IRS checks your history and applies it if you qualify. Most people never ask.
The criteria (as of 2026-09, verified on the IRS penalty-relief pages): the same type of return must have been filed on time for the prior three years, and no penalties (other than estimated-tax penalties) may have been assessed on those returns — or any penalty assessed must have been abated for reasonable cause or IRS error.
What FTA does not do
- It does NOT remove interest — interest accrues until the underlying tax and penalties are paid, and the IRS states it will not abate interest for reasonable cause or first-time relief.
- It does not apply to estimated-tax (underpayment) penalties.
- It is not a guarantee for your account — the IRS verifies your compliance history directly.
Automatic Exemption from Penalty (AEP) — new for 2026
Starting summer 2026, the IRS is phasing in Automatic Exemption from Penalty for taxpayers with three years of timely filing and payment history: late-filing and late-payment penalties are not assessed at all on 2025+ tax-year returns. If your penalties should have been covered automatically and weren't, request the applicable relief — our FTA letter includes that language.
How to request it
- Call the number on your notice and ask the representative to check FTA eligibility for the specific years — many FTA grants happen on the call.
- If the phone route fails, send a written request (our FTA letter includes the eligibility self-check) or file Form 843 if instructed.
- Before you claim eligibility, be honest about the prior three years — the IRS can see your history and a wrong claim wastes your window.
Sources & confidence
Rule as of 2026-09, verified on https://www.irs.gov/payments/administrative-penalty-relief (page reviewed 2026-07-14). Interest rules verified on https://www.irs.gov/payments/interest. Form 843: https://www.irs.gov/forms-pubs/about-form-843. Not tax advice; FTA is decided by the IRS based on your account history — no outcome is guaranteed.
Turn this into a plan
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