IRS Tax Relief Program: Waivers for Millions of Americans Including Crypto Users

The IRS has announced a relief program for millions of Americans who have yet to pay their taxes for 2020 or 2021. Additionally, crypto users who have failed to report their crypto transactions from those years stand to benefit from this initiative. Here are the key points regarding this important development:

Relief Program Details:

• The IRS will waive the standard "failure to pay" penalty for over 4.7 million tax filers who haven't paid their 2020 or 2021 taxes. This penalty is equivalent to 0.5% of the filer's unpaid taxes, charged for every month they fail to pay after the filing deadline.
• The estimated savings for taxpayers collectively amount to $1 billion.
• Eligibility for penalty relief extends to over 4.7 million taxpayers, primarily individuals who made under $100,000 in 2020 or 2021. Some taxpayers with higher incomes will also be included. The relief is applicable only to taxpayers with assessed tax under $100,000.
• The IRS will start sending letters to eligible taxpayers this month, informing them of their inclusion in the program.
• The penalty relief will be automatic, and taxpayers who already paid late penalties for the applicable years will receive a full refund of those charges.

Time Limit and Reasoning:

• The relief program will run from now through the end of March, with the monthly late fee returning for all taxpayers starting April 1.
• The IRS implemented this waiver to address the potential unfairness caused by stopping reminders about overdue tax bills during the height of the COVID-19 pandemic while still charging late fees for those bills.

This opportunity provides significant relief for taxpayers who have struggled to pay their taxes for 2020 or 2021. It is crucial for eligible individuals to take advantage of this program before the deadline at the end of March to avoid incurring additional late fees.