William, a tax-payer, timely mailed his tax return. However, the same was returned for insufficient postage. IRS imposed a penalty. Can William claim waiver of penalty?

Question

Quizplus · Accepted Answer

According to the IRS guidelines, taxpayers can claim a waiver of penalties if the failure to file tax returns is due to reasonable cause. In this case, William timely filed his tax return, but it was returned for insufficient postage. Therefore, William can claim waiver of the penalty. However, it is not because it is his first tax return, as stated in option A. Option C is incorrect as it mentions willful neglect, which is not the case here. Option D is also incorrect as William is not a delinquent taxpayer.

William, a Tax-Payer, Timely Mailed His Tax Return