IRS penalties can add 25% or more to your balance. Failure-to-file runs 5% per month up to 25% under IRC Section 6651(a)(1). Failure-to-pay adds 0.5% per month up to 25%. But penalties are often the easiest part to eliminate.
First-Time Abatement under IRM 20.1.1.3.6.1 removes penalties if you had clean compliance for the prior three years. No explanation needed. Reasonable cause under IRC Section 6651(a) applies when you exercised ordinary business care but could not comply. We draft these letters regularly.