who may be affected by monetary penalties imposed by the irs
Taxpayers in the United States
title: IRS penalties text: IRS penalties Taxpayers in the United States may face various penalties for failures related to Federal, state, and local tax matters. The Internal Revenue Service (IRS) is primarily responsible for charging these penalties at the Federal level. The IRS can assert only those penalties specified imposed under Federal tax law. State and local rules vary widely, are administered by state and local authorities, and are not discussed herein. Penalties may be monetary or may involve forfeiture of property. Criminal penalties may include jail time, but are imposed only by a federal judge after a defendant is convicted. Most monetary penalties title: IRS penalties text: assessed against tax protesters who raise arguments that income tax laws are not valid, or who otherwise file frivolous returns or court petitions. Penalties also apply to people who promote tax shelters or who fail to maintain and disclose lists of reportable transactions their customers or clients for those transactions. These monetary penalties can be severe. Most penalties are subject to judicial review. However, the courts rarely modify assessment of the penalties and interest for underestimate or late payment. IRS penalties Taxpayers in the United States may face various penalties for failures related to Federal, state, and local tax matters. title: IRS penalties text: and may be substantial. Some penalties are imposed as excise taxes on particular transactions. Certain other penalties apply for other types of failures. Certain acts may result in forfeiture of property of the taxpayer. There are over 150 kinds of civil penalties in the U.S. Internal Revenue Code, ranging in severity which is reflected in the amount of the applicable fines. Taxpayers are required to have withholding of tax or make quarterly estimated tax payments before the end of the tax year. Because accurate estimation requires accurate prediction of the future, taxpayers sometimes underestimate the amount due. The penalty for title: IRS penalties text: are based on the amount of tax not properly paid. Penalties may increase with the period of nonpayment. Some penalties are fixed dollar amounts or fixed percentages of some measure required to be reported. Excise taxes used as penalties are imposed in the Code sections relating to particular kinds of transactions. Some penalties may be waived or abated where the taxpayer shows reasonable cause for the failure. Penalties apply for failures to file income tax returns or information returns, or for filing incorrect returns. Some penalties may be very minor. Penalties apply for certain types of errors on tax returns, title: IRS penalties text: the second page of Form 1040. The IRS advises that the taxpayer "not include interest or penalties (other than the estimated tax penalty)" in the "Amount Owed" line of the form. If amounts reported on an income tax return are later adjusted by the IRS and a tax increase results, an additional penalty may apply. This penalty of 20% or 40% of the increase in tax is due in the case of substantial understatement of tax, substantial valuation misstatements, transfer pricing adjustments, or negligence or disregard of rules or regulations. For example, a valuation overstatement can result in a 30%