Form 843: Claim for Refund and Request for Abatement Overview

KEY TAKEAWAYS

• Form 843 is used to request a reduction in interest or penalties that the IRS has incorrectly assessed or to demand a refund of some assessed taxes.
• The form must be submitted no later than two years following the payment of taxes or three years following the filing of the return, whichever is later.
• Each sort of tax or fee, as well as each tax year, requires its own form to be submitted.

What Is Form 843?

Form 843: Claim for Refund and Request for Abatement is a multifunctional tax form that the Internal Revenue Service (IRS) issues. This form is used by taxpayers when requesting the abatement of interest or penalties that were incorrectly applied or when claiming a refund of certain assessed taxes and fees.

What Is the Purpose of Form 843?

Use Form 843 to request an exemption from the IRS for certain taxes other than income, such as:

• Gift or estate taxes
• Interest or penalties brought on by mistakes, delays, or inaccurate IRS written guidance
• To request a refund of any Social Security or Medicare taxes that were improperly withheld from your paycheck and for which your employer won’t make any adjustments to the excess amount collected.

Who Can File Form 843?

A taxpayer may submit Form 843 for a number of reasons. This covers situations where an employer withholds excessive amounts of income, Social Security, or Medicare tax from a worker’s paycheck and refuses to make changes. The authorized representative of a taxpayer may also submit this form.

Another justification for submitting this form could be a mistake or hold-up by the IRS. It may occur, when a taxpayer is incorrectly assessed interest, fines, or additional taxes that are not due. In these situations, a taxpayer may submit a claim for a refund or abatement to ask the IRS to correct the error or errors.

In general, a separate Form 843 must be submitted for each tax year and each type of tax or fee.

How to File Form 843?

Basic details like name, address, Social Security number, tax period, tax type, and return type are needed for Form 843. You must provide a detailed explanation of the circumstances and problems supporting your claim for a refund or discount. 

The Internal Revenue Code (IRC) section number of the penalty must be written on Line 4 of penalty abatement requests. This section number can be found on the IRS notice that you received. Then, under Section 5a, you must select a justification for your request. Choices include

• Due to mistakes or delays made by the IRS, interest was charged.
• IRS written information that is incorrect
• Reasonable cause or a different factor unrelated to incorrect written guidance

In Section 7, you may include a written justification for your request. Keep in mind to back up your arguments with facts and calculations. If you require more room, the IRS allows you to attach additional pages.

It’s also important to remember to provide your employer identification number when filing. 

What Are the Requirements for Filing Form 843?

Unless you’re dealing with an excise tax, filing Form 843 is as straightforward as mailing the finished document. In that situation, Form 4720 would also need to be submitted.

An income or employment tax return that has already been filed cannot be amended using Form 843 to:

• Request reimbursement of the agreement, compromise, or lien fees.
• Ask for a reduction in gift or estate taxes
• Request a Federal Insurance Contributions Act (FICA) tax refund or reduction.
• Make a Railroad Retirement Tax Act tax refund or abatement claim.
• Request a refund or reduction of the income tax withheld.

Summary

IRS Form 843 is a written request to the federal government to remove some fines or taxes that have been assessed against taxpayers. These include fines for late payments, incomplete filings, and employers who fail to make the necessary tax deposits.

The form must be submitted no later than two years after the day you paid your tax return or three years following the filing date of your singular or joint tax return, whichever comes first.

Written by Sandra Habiger, CPA

Sandra Habiger is a Chartered Professional Accountant with a Bachelor’s Degree in Business Administration from the University of Washington. Sandra’s areas of focus include advising real estate agents, brokers, and investors. She supports small businesses in growing to their first six figures and beyond. Alongside her accounting practice, Sandra is a Money and Life Coach for women in business.

Written by Sandra Habiger, CPA

Sandra Habiger is a Chartered Professional Accountant with a Bachelor’s Degree in Business Administration from the University of Washington. Sandra’s areas of focus include advising real estate agents, brokers, and investors. She supports small businesses in growing to their first six figures and beyond. Alongside her accounting practice, Sandra is a Money and Life Coach for women in business.