Exception for first time depositors of employment taxes—(1) Waiver. The Secretary will generally waive the penalty imposed by section 6656(a) on a person's failure to deposit any employment tax under subtitle C of the Internal Revenue Code if—
The failure is inadvertent;
The person meets the requirements referred to in section 7430(c)(4)(A)(ii) (relating to the net worth requirements applicable for awards of attorney's fees);
The failure occurs during the first quarter that the person is required to deposit any employment tax; and
The return of the tax is filed on or before the due date.
Inadvertent failure. For purposes of paragraph (a)(1)(i) of this section, the Secretary will determine if a failure to deposit is inadvertent based on all the facts and circumstances.
Deposit sent to Secretary. The Secretary may abate the penalty imposed by section 6656(a) if the first time a taxpayer is required to make a deposit, the amount required to be deposited is inadvertently sent to the Secretary rather than deposited by electronic funds transfer.
Effective/applicability date. This section applies to deposits and payments made after December 31, 2010.
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