Those with back taxes under $100,000 per year for tax years 2020 and 2021 will be waived off of penalty fees according to the recent announcement of the IRS.
Nearly 5 million people will qualify for the relief of the waived penalty fees. (Photo: US Tax Help)
Back Taxes As A Qualification For A Relief
The IRS will waive penalty fees for individuals with back taxes under $100,000 per year for tax years 2020 and 2021. This relief that will be received by individuals with back taxes, totaling around $1 billion, will be available to nearly 5 million people, businesses, and tax-exempt organizations, especially those with incomes under $400,000 per year.
The IRS stopped sending automated reminders for tax bills during the pandemic, which contributed to the decision to forgive failure-to-pay penalties for individuals with back taxes.
While regular collection notices will resume, this one-time relief for taxpayers with back taxes is meant to address the unprecedented circumstances of the pandemic.
According to a published article by The North State Journal, taxpayers who meet certain criteria, such as those with back taxes, will automatically receive this relief without needing to take additional action, and those who have already paid the penalty even with back taxes will be refunded.
Total Relief Amount Of $1 Billion
In a published article by MarketWatch, the total relief amount is estimated to be around $1 billion. Although normal collection notices will resume in the future, this announcement is a one-time relief measure based on the exceptional circumstances caused by the pandemic.
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