Nobody likes opening a letter from the IRS only to discover penalties have been added to an already stressful tax bill. The good news is that the Internal Revenue Service is making it easier for many taxpayers to receive penalty relief without knowing every rule or filing a special request. In summer 2026, the IRS began rolling out a new Automatic Exemption from Penalty (AEP) process that replaces much of the old First Time Abate system for eligible taxpayers, dramatically expanding access to relief. However, not everyone qualifies automatically, and many taxpayers still need to request relief by showing reasonable cause or using other available procedures.
If you’re curious about this new program, here’s what you need to know.
