Form 5472 was missing or late
Your foreign-owned LLC or corporation did not file Form 5472 on time. The IRS assesses $25,000 per year for this, for example with notice CP215.
Who it's for
For everyone holding an IRS notice with a penalty.
Return or payment was late
Your corporation, your partnership or you yourself filed or paid late. The IRS charges a monthly penalty for this, up to 25 percent of the tax.
Form 5471 missed
Your US company owns a foreign company and did not file Form 5471: $10,000 per year, and up to $50,000 more after a reminder notice.
Penalty already paid
You can still file a request: with Form 843 you claim a refund or abatement of a penalty.
Three tiers, one fixed fee per notice
What the request costs.
You pay a fixed fee per notice, tiered by the type of penalty. There is no success fee: you pay for the request and the follow-up, not for the outcome, because that is decided by the IRS alone.
Tier 1
Late filing or late payment
$1,500per notice
Penalties for filing or paying a return late. The IRS first considers First Time Abate and only then reasonable cause. We prepare the request so that both routes stay open.
Order tier 1 →Tier 2
Penalty for an information return
$3,500per notice
Form 5472, Form 5471 and other information returns not covered by the waiver rule. A fully reasoned request for reasonable cause, with a statement under penalties of perjury and supporting documents.
Order tier 2 →Tier 3
Additional notice for the same company
$1,500per notice
The same penalty for another year, based on the same facts. The second and every further request builds on the first.
Order tier 3 →If the IRS says no, you can still go to the Independent Office of Appeals. You usually have 30 days from the date of the denial letter; the deadline stated in the letter is what counts. We bill the appeal by time and effort and give you an estimate up front.
What changes in 2026
The waiver becomes automatic. It does not apply to Form 5472.
The best-known IRS waiver is First Time Abate: if you filed the same return on time for the three prior years and had no penalties (other than for underpaid estimated tax), a penalty for late filing, payment or deposit is removed for one period. According to the IRS, from summer 2026 it becomes a new rule, the Automatic Exemption from Penalty.
For returns from tax year 2025 (Form 1040, 1065 and 1120) and quarterly returns from 2026, the IRS will no longer assess a penalty at all if your history is clean; you do not need to request anything. As before, returns filed only once or rarely, and filings attached to another return, are excluded.
What this means for Form 5472: the waiver does not apply to it, not even the new one. The route left is a request for reasonable cause. The one exception in the IRS manual: if Form 5472 was attached to a late Form 1120 and that return's late-filing penalty is waived, the 5472 penalty can be removed too, provided there was no such penalty and no late Form 1120 in the three prior years.
Form 5472
What a Form 5472 request needs.
Against the Form 5472 penalty, what helps is reasonable cause, set out in a written statement under penalties of perjury. For small companies with gross receipts of up to 20 million dollars a year, the IRS is to apply reasonable cause generously if the company did not know about the requirement, has limited contact with the US and answers all IRS requests fully and promptly. This is set out in the regulations (Treas. Reg. § 1.6038A-4(b)(2)(ii)) and in the IRS manual.
In April 2026 the IRS published advice from its Chief Counsel (CCA 202617012). It says the IRS may accept reasonable cause for such a small company if it cooperates promptly and fully. The document itself names two limits: a bare claim without facts and evidence is not enough, and the advice is not precedent you can rely on.
That is why our request does not say "I didn't know". It sets out the facts: who owns the company, what its receipts were, what its ties to the US are, when the requirement became known and what has happened since, all with evidence. If the form is still missing, we file it first; the manual recommends considering reasonable cause only once all missing returns have been filed.
Sources: IRS, Penalty relief due to First Time Abate or other administrative waiver (as of July 14, 2026); Internal Revenue Manual 20.1.1 and 20.1.9; IRS Chief Counsel Advice 202617012 (published April 24, 2026); 26 U.S.C. §§ 6038, 6038A, 6651. Accessed October 22, 2026.
Process and deadlines
From the notice to the IRS decision.
The IRS gives no processing time on its penalty relief pages. So we don't give one either. What is certain are the deadlines in your notice and the rules that follow.
01You send us the noticeDeadline: the one in the noticeThe notice number is in the top right corner, for example CP215 or CP162. The IRS expects you to respond by the date given. Send us every page, as early as you can.
02Review and routeBefore the requestWe review the penalty, amount, tax year and your history and decide whether the waiver, reasonable cause or both apply.
03Missing forms firstWhere neededIf the return or information return is still missing, we file it before the request. You book this as a separate service.
04Request under power of attorneyBefore the deadlineYou sign Form 2848, the power of attorney for the attorneys on the firm's team. We file the request in writing, with Form 843 if needed, and support it with facts and evidence.
05Follow-up until the decisionUntil the IRS has decidedWe stay in contact with the IRS and answer its questions. If the penalty is removed, the IRS automatically reduces or removes the interest on it.
06If denied: AppealsUsually 30 daysThe Independent Office of Appeals is the only formal appeals body within the IRS. The deadline is stated in the denial letter. We bill the appeal by time and effort.
Sources: IRS, Understanding your IRS notice or letter; Penalty relief (as of September 9, 2026); Penalty appeal (as of July 23, 2026); About Form 2848; About Form 843; Internal Revenue Manual 20.1.1.4.1. Accessed October 22, 2026.
Questions
Questions about IRS notices and penalties.
Does First Time Abate also apply to the $25,000 penalty for Form 5472?
Usually not. According to the IRS manual, the waiver does not apply to information returns such as Form 5472. The one exception: if the form was attached to a late Form 1120 and that return's late-filing penalty is waived, the 5472 penalty can go too, provided there was no such penalty and no late Form 1120 in the three prior years. Otherwise, the route is a request for reasonable cause.
I didn't know about Form 5472. Is that enough of a reason?
Not on its own. For small companies with receipts of up to 20 million dollars, the IRS is to apply reasonable cause generously if the company did not know about the requirement, has limited ties to the US and cooperates fully. This must be set out in a statement under penalties of perjury, with facts and evidence. According to the IRS, a bare claim is not enough.
Do I need to file the missing form first?
Yes. The IRS manual recommends considering reasonable cause only once all missing returns have been filed. You book the late filing as a separate service, for example the zero tax return for an LLC with Form 5472.
I have notices for several years. Does each one cost extra?
Each notice is a separate request. For the first notice on an information return you pay $3,500, and $1,500 for each further notice for the same company and the same penalty.
I've already paid the penalty. Can I get it back?
You can still file a request: Form 843 lets you claim a refund or abatement of a penalty. Whether the IRS refunds it is up to the IRS.
What happens if I ignore the letter?
For Form 5472, once the IRS has sent a notice and 90 days have passed, a further penalty of $25,000 is added for each 30-day period or part of one, with no upper limit. The IRS charges interest on unpaid penalties. Respond by the date stated in the letter.
How long does the IRS take to decide?
The IRS gives no processing time for this, and we don't promise one. We follow up until the IRS has decided.
What happens if the IRS says no?
Then you can go to the Independent Office of Appeals, the only formal appeals body within the IRS. You usually have 30 days from the date of the rejection; the deadline in the letter is what counts. We bill the appeal based on time spent.
Is the interest removed too?
Yes, to the extent the penalty goes. According to the IRS, interest on a penalty that is abated or reduced is adjusted automatically.
Why a fixed fee and not a success fee?
Because the outcome isn't in our hands: the IRS decides. You pay for the work we do: review, request, representation and follow-up. That way you know up front what the request costs.
Can't I just call the IRS myself?
For first-time abatement, yes: according to the IRS, you can call the number in the letter or request it in writing. A penalty on Form 5472 or 5471 needs a reasoned reasonable cause request with a statement signed under penalties of perjury. That's where we come in.
Does this also cover penalties for a missing FBAR?
No, not at the fixed fee. For the FBAR, the IRS acts not under the tax code (Title 26) but under Title 31, and the tax code provisions generally don't apply. After a review, we'll give you a separate quote.
Can I just file the form late and hope for the best?
The IRS procedure for late international information returns only applies as long as the IRS hasn't yet contacted you about the missing return. If you already have a letter, a penalty abatement request is the way forward.
