Penalty & Interest Abatement Services

Recover penalties and interest you may not have owed — or stop unnecessary IRS charges from continuing to accrue.

If you paid IRS penalties or interest during the COVID-era, or still have balances growing, there may be an opportunity to reduce or recover those amounts. Omega’s Tax Controversy team reviews prior IRS assessments, identifies whether charges were properly imposed, and prepares the right strategy for refund or abatement. This aligns directly with the service and message in your draft.

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COVID-Era Penalties & Interest May Not Have Been Owed

A recent court decision, Kwong v. United States, raised a new interpretation of pandemic-era relief under IRC §7508A. If that interpretation applies, some taxpayers may have been charged penalties or interest that were not legally due.

KEY DATES
Broader suspension of deadlines may apply
Potential period affected:
Jan 20, 2020 – July 10, 2023
Key deadline to act:
July 10, 2026

What This Could Mean for You



Recover Paid Penalties

Seek refunds for penalties already assessed and paid.



Reduce or Eliminate Interest

Identify interest that may not have accrued properly.



File Protective Claims

Preserve your rights while the legal landscape develops.

Stop Ongoing Accruals

Address current balances before unnecessary charges continue.

Not the Typical Reasonable Cause Argument

Historically, penalty relief often depended on proving reasonable cause, administrative error, or reliance on IRS guidance. This opportunity is different: the issue may be whether the IRS had authority to assess the penalty or interest in the first place. That distinction is one of the strongest points in your draft and should be elevated as its own section.

What Omega Provides

Eligibility Assessment
Review IRS transcripts and filings to identify penalties and interest tied to potentially eligible periods.
Refund & Abatement Strategy
Determine whether a refund claim, abatement request, or protective claim is the strongest path.
Form 843 Preparation & Filing
Prepare and file Form 843 with the right legal framing and substantiation.
IRS Representation
Respond to notices, manage follow-up, and support the matter through resolution.

Time Is Critical

Refund and abatement claims are subject to strict deadlines. Missing the July 10, 2026 window could mean losing the ability to recover funds even if they were never owed.

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Who Should Take Action

You should strongly consider a review if you:

Paid penalties or interest between 2020–2023
Still have outstanding IRS balances accruing interest
Filed late or paid late during COVID
Have not reviewed your IRS transcripts recently

Tracy Anagnost Martinez, JD, LLM
Senior Director of Tax Controversy

Tax Controversy and Criminal Tax specialist. Over 30 years experience with the DOJ Tax Division and the IRS Office of Chief Counsel. Currently Senior Director, Tax Controversy at Omega Accounting Solutions.

Read ‘Kwong v. United States: Did You Pay Penalties and Interest During the COVID-19 Pandemic that Were Not Really Due?‘

Get a Complimentary Review

There’s no downside to checking — but there is a real cost to waiting. Have Omega review your situation and determine whether penalties or interest may be reduced, eliminated, or recovered.

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