Waiver of Penalty

The Department of Revenue assesses penalties against taxpayers for failure to comply with Georgia tax law.  Examples of failure to comply include:

  • Filing tax returns late
  • Paying tax liabilities late
  • Failing to make required estimated deposits
  • Failing to file or pay electronically when required

A penalty waiver will be granted if reasonable cause exists.  Reasonable cause happens from circumstances beyond the taxpayer’s control. Each case must be decided on its own merits based on documentation from the taxpayer. Good filing history alone is not considered reasonable cause.  Moreover, the department may abate a partial amount of the penalty depending on the circumstances related to the request.  The Department has issued a policy statement that provides more information regarding circumstances in which the Department may waive penalty and interest.

When requesting a penalty waiver for a business, remember that sales tax and withholding are trust fund taxes. This means that the money collected or withheld belongs to the state and the debtor is holding the money in trust. This money cannot be used by a business as additional operating capital or for any other purpose.

To request a penalty waiver, you can either submit Form TSD-3 (Request for Penalty Waiver) or go online to the Georgia Tax Center.