Filling Form 843 for PCORI penalty abatement

• Form 843 requests IRS penalty abatement for eligible situations.
• Use Form 843 after paying or assessing the penalty.
• Explain the reasonable cause with supporting documentation.
• Do not use Form 843 to amend PCORI tax returns.
• Submit the completed form to the appropriate IRS address.

When Should You File Form 843 for a PCORI Penalty?

Employers and plan sponsors who are required to file IRS Form 720 and who also include the PCORI fee may face IRS penalties in the event of a late filing or payment.

You may be eligible for penalty relief through Form 843 if the penalty was due to reasonable circumstances beyond your control.

Form 843 can be used if you want to get a refund on certain IRS penalties, interest, or fees. It is worth noting that it will not amend or correct your Form 720.

The form can be filed by someone, together with an explanation and relevant attachments, who has received a PCORI-related penalty letter, and such an IRS case will be reviewed.

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Situations That May Qualify for Penalty Abatement

Penalty relief is generally considered by the IRS only if the taxpayer showed reasonable cause.

Each request is evaluated based on the facts accompanying it and the proof provided.

The IRS may consider penalty abatement for the following reasons, among others:

• Natural disasters or extremely severe weather conditions
• A very serious illness or the death of an individual who is responsible for making a taxpayer's business decisions
• Fire, theft, or other unanticipated business interruptions
• Getting incorrect written advice from the IRS
• A large, organization-wide or departmental problem that prevents timely compliance even after all reasonable measures are taken

Mere forgetfulness to file or lack of funds cannot count as a reasonable cause. Your account of the situation must show that you made an effort for ordinary business care but were still helpless regarding the deadline for filing.

Information You'll Need Before Completing the Request

If you start making your request right away, it is easier for you to prevent mistakes and delays.

The following are the things you should have or do before you begin to make your request:

• Printout of IRS penalty notice
• The names of the business and the employer Identification Number
• Tax year or period that relates to the PCORI filing
• Penalty that was imposed along with the description of the nature of the tax
• Papers that support the claim for reasonable cause
• An explanatory document giving your version of what really happened

A well-organized submission will significantly increase the odds of your request being accepted and make the processing by IRS staff more efficient.

Completing Form 843 Accurately

Even if the form is very small and short, it would be better not to skip a word to fill it out as required.

The form's completion is as follows:

• Fill in the details of the taxpayer exactly as they appear on the IRS records.
• Identify the applicable tax period related to your Form 720 PCORI filing.
• State clearly that the purpose of your request is to have the penalties reduced.
• Give a clear description of the facts that led to the lateness, either in filing/paying, etc.
• Attach copies of the relevant supporting documents.
• Sign and date it before the document is sent.

The explanation of your situation provided should not be based on feelings but should be fact-based, backed by evidence, logical, and well-organized.

Common Mistakes That Can Delay Your Request

Ineligible applications may also be delayed due to a lack of information.

Hence, you should avoid the following:

• Taxpayer ID information that is missing/incomplete
• Blank or unfurnished explanation with no evidence backing up its assertion
• Failing to enclose the notice from the IRS that shows an assessment
• Failure to submit the needed support in paper or digital mode
• Asking to eliminate the penalty but failing also to indicate the corresponding penalty
• Sending your request to an invalid address

Review your submission carefully before mailing it to ensure everything is complete.

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How Form 843 Relates to Form 720 PCORI Filing

Many taxpayers mistakenly believe that filing Form 843 replaces or corrects a Form 720 return.

It does not.

These two forms serve different purposes:

If your original Form 720 has reporting errors, you must follow the IRS procedures applicable to correcting that return. Form 843 is only used to request relief from eligible penalties or related assessments.

Tips to Improve the Chances of Approval

Your application will not be accepted unless you satisfy all requirements, but there are various ways to make your request better and more convincing.

Best practices include:

• File the request promptly after receiving the IRS notice.
• Provide a detailed, chronological explanation.
• Include all available documentation supporting your claim.
• Ensure your tax filings remain current going forward.
• Keep copies of everything submitted for your records.

A complete and well-documented request allows the IRS to evaluate your circumstances more effectively.

Resolve Your PCORI Filing Matters with Confidence

If you've received a PCORI penalty, Form 843 can help you request penalty relief when you have reasonable cause. eFile720 makes Form 720 filing simple, accurate, and efficient, helping you stay compliant and reduce the risk of future penalties.

FAQs

1. Can Form 843 remove every IRS PCORI penalty?

No. The IRS approves penalty abatement only when sufficient reasonable cause is established and supported by appropriate documentation.

2. Do I use Form 843 instead of filing Form 720?

No. Form 720 reports and pays the PCORI fee, while Form 843 is only used to request relief from eligible penalties after assessment.

3. Can I file Form 843 without supporting documents?

You can submit the request, but providing documentation significantly improves the IRS's ability to evaluate and process your claim successfully.