Short answer
The IRS waives failure-to-file and failure-to-pay penalties under 26 U.S.C. § 6651 through First Time Abate when the prior three years show timely compliance. Starting summer 2026, Automatic Exemption from Penalty applies that relief automatically to 2025 returns. Reasonable cause covers events such as serious illness or disaster.
Three ways penalties come off
Request
First Time Abate
Three prior years timely filed and paid. Covers failure-to-file, failure-to-pay and failure-to-deposit penalties. Ask by phone, letter or Form 843.
Automatic, from summer 2026
Automatic Exemption from Penalty
Applied when the original return is processed: 2025 tax-year Forms 1040, 1065, 1120 and 2026 quarterly payroll returns (940, 941, 943, 944, 945, CT-1). A letter confirms it.
Facts and circumstances
Reasonable cause
Ordinary care was used and filing or paying on time was still impossible: fire or disaster, records unavailable, death or serious illness in the family, system failures.
What usually does — and doesn’t — count as reasonable cause
| May qualify | Generally doesn’t qualify alone |
|---|---|
| Fire, natural disaster, civil disturbance | Relying on a tax preparer |
| Unable to get records | Not knowing the rule |
| Death, serious illness or unavoidable absence of the taxpayer or immediate family | Mistakes and oversights |
| System issues that delayed an e-filed return or payment | Lack of funds |
City of Canton penalties are separate
Canton’s own charges — a $25 late-filing penalty, 15% of tax not paid on time, and interest (0.75% per month on the 2025 sheet; 9% per year for 2026 on the department’s page) — are not touched by IRS relief. City income tax details.
Penalties often come from a CP2000 adjustment or late 1099 income; see answering a CP2000 and self-employed tax debt. Everything else is mapped on the Canton tax-help overview page.
Penalties larger than the tax? A licensed professional can check FTA, AEP and reasonable cause before anything is paid.
Call (330) 457-6198Questions people in Canton ask
What is First Time Abate?
An administrative waiver of failure-to-file, failure-to-pay and failure-to-deposit penalties for taxpayers with three years of timely compliance history. Request it by calling the number on the notice or by written statement or Form 843.
What changed in 2026?
The IRS is moving First Time Abate to Automatic Exemption from Penalty (AEP), starting summer 2026 with 2025 tax-year returns and 2026 quarterly returns. If the prior three years (or 12 quarters) were filed and paid on time, the penalty simply is not assessed, and the IRS sends a letter saying so. No request is needed.
I did not have the money. Is that reasonable cause?
Not by itself. The IRS says lack of funds alone is not reasonable cause, though other facts showing reasonable care may qualify. Reliance on a preparer, lack of knowledge and simple mistakes generally do not qualify either.
Can interest be removed too?
The IRS automatically reduces or removes the interest related to a penalty when the penalty is reduced or removed. Interest on the tax itself generally stays. Ask a licensed professional to review the specific notice.
Does the City of Canton waive its penalties?
The city publishes its penalties — $25 for late filing, 15% of tax paid late, and interest — but no published waiver program. Call the Income Tax Department at 330-430-7900 with the facts.
Back to the start: the Canton tax-help home page.
Sources
Every fact on this page comes from these official pages, read on the date shown. Tax-law facts are re-checked at least every 90 days and local office facts every 180 days.
- 26 U.S.C. § 6651 Failure to file tax return or to pay tax — Cornell LII. Accessed October 10, 2026.
- Penalty relief due to First Time Abate or other administrative waiver — IRS. Accessed October 10, 2026.
- Penalty relief due to reasonable cause — IRS. Accessed October 10, 2026.
- IRM 20.1.1 Introduction and Penalty Relief — IRS. Accessed October 10, 2026.
- 2025 General Information (PDF) — City of Canton Income Tax Department. Accessed October 10, 2026.
- Income Tax (Treasury) department page — City of Canton. Accessed October 10, 2026.