Is a penalty exception the same as a penalty waiver?

No. A penalty exception means the penalty should not apply under the rule. A waiver means the penalty otherwise applies, but the IRS may reduce or remove it because the taxpayer meets a waiver standard.

For example, a decedent's estate within the two-year Form 2210 exception should generally respond by showing the exception facts: estate status, date of death, tax-year end date, and Form 1041 details. That is different from asking the IRS to waive a valid penalty because of hardship, disaster, or another unusual circumstance.

The exam-friendly order is:

1. Check whether estimates were required.
2. Check whether an exception applies.
3. If no exception applies, compute Form 2210 and consider waiver facts.