Taxpayers seeking penalty relief for both 2020 and 2021 face a paper-filing requirement that doubles their administrative burden: the IRS demands a separate Form 843 for each tax year, meaning two distinct claims must be prepared, signed, and mailed rather than one. The rule, spelled out in the December 2024 revision of the form’s instructions, forces filers into parallel processing tracks at a time when IRS paper-claim turnaround already stretches months. For anyone whose penalty abatement spans consecutive years, the practical cost is not just extra paperwork but exposure to two independent refund-deadline clocks ticking under federal statute.
Why Separate Form 843 Filings Create Compounding Delays
The IRS instruction is blunt. Taxpayers are told they “must file a separate Form 843 for each tax period or fee year (and/or type of tax/fee),” language that appears in the official form instructions. That eliminates any shortcut for taxpayers who owe penalty refunds across 2020 and 2021. Each claim enters the agency’s pipeline as a standalone submission, triggering its own verification cycle, its own examiner review, and its own correspondence trail.
The separate-filing rule is not a quirk of one form. Guidance in Publication 556 reinforces the same principle in the broader refund context, directing filers to submit a distinct claim for each year or period involved. The IRS Internal Revenue Manual, which governs how agency personnel handle these requests, aligns with that directive and instructs examiners on penalty abatements and other adjustments at the tax-period level. Under the procedures in the Internal Revenue Manual, each Form 843 is worked against the specific year’s account records, payment history, and penalty assessment rather than as part of a consolidated multi-year package.
The hypothesis that two adjacent-year filings generate more than twice the processing friction has a structural basis. Each claim must satisfy the refund limitation period set by 26 U.S. Code Section 6511, which ties deadlines and lookback caps to specific tax years and payment dates. A 2020 claim and a 2021 claim carry different limitation windows, different payment dates, and potentially different penalty types. The IRS cannot batch them without risking a misapplied statute of limitations. The result is two independent threads competing for the same constrained examiner resources, each requiring its own statutory-deadline check before any refund can be issued.
In practice, that means a taxpayer may see one year resolved while the other lags far behind, even though both envelopes were mailed the same day. Any IRS request for additional information also multiplies: if an examiner needs supporting documentation for each year, the taxpayer could receive two separate letters and have to assemble two sets of responses. For households and small businesses already struggling to reconstruct records from the pandemic years, that fragmentation increases the likelihood of missed deadlines, incomplete submissions, or inconsistent explanations across claims.
Statutory and Regulatory Roots of the One-Year Rule
The one-form-per-year requirement traces directly to federal regulation. Under 26 CFR Section 301.6402-2, a claim for refund must state the specific grounds, facts, and period involved, and it must comply with the instructions on the prescribed form. Because the Form 843 instructions explicitly require separation by tax period, combining years on a single form would violate the regulatory standard for a properly presented claim. A consolidated narrative that tries to cover both 2020 and 2021 in one filing could be treated as defective, exposing the taxpayer to denial on procedural grounds even if the underlying penalties are clearly erroneous.
Form 843 itself remains a paper-only vehicle for penalty abatement requests. The IRS landing page for the form confirms its purpose and links to the current revision, but offers no electronic filing option. That means each claim travels through the mail, enters a manual intake queue, and is subject to the same scanning, routing, and data-entry bottlenecks that have plagued paper submissions in recent years. For a taxpayer with penalties in two consecutive years, the absence of e-filing translates into two separate mailings, two sets of delivery risks, and two chances for a claim to be delayed or misrouted inside the agency.
Viewed against this backdrop, the separate-filing mandate is more than a technical formality. It is a design choice that channels multi-year penalty disputes into fragmented, slower-moving lanes at precisely the moment when many taxpayers are trying to clean up pandemic-era compliance problems. Until the IRS offers an electronic pathway or revises its instructions to permit consolidated multi-year narratives within a single form, taxpayers seeking relief for 2020 and 2021 must navigate dual paper processes, each governed by its own statute of limitations and each vulnerable to the familiar frictions of manual review.
Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
