Other violations are not automatically assessed and require a due process notice,

• inaccurate return,
• intentional disregard for published protocol,
• mismatch information return,
• undeposited collected tax,
• trust fund recovery, and
• intentionally evading tax.

Passive and indifferent behavior, and willful disregard for published rules and regulation, will draw an objective irs proposal to assess a stiff negligence penalty. Willful disregard is based on ignoring tax protocol pre-printed in publications, widely-published and in plain view. Tax voluntarily reported at 90% [or more], less than the actual amount due, will draw a proposal to assess the stiff penalty. See Revenue Procedure 94-69.

Tax auditors must propose all non-automatic penalty assessments, such as negligence penalty, in an examination report by citing specific reason(s) and a specific amount, and provide a notice of such proposal. Reason(s) cited must align with gross income, adjusted gross income and other taxable sections on tax return.

Relief for overcoming penalty assessments and proposals requires a complaint letter focusing on specific factual circumstances that rebut an automatic assessment, or rebut a proposal to assess. Rebuttal focuses on reasonable cause.

Reasonable cause can remedy penalty assessments and proposals. Because penalties arise for specific and separate reason, so does the criterion required to establish reasonable cause.

A sample letter to quash a penalty proposal, or a sample letter to abate a penalty already assessed, can communicate a reasonable cause message. Absent reasonable cause, there is no remedy.

A licensed tax professional is go-to resource for abstracting factual circumstances to support audit assistance, reasonable cause and other tax penalty matters.

Pose a tax question or concern relating to tax penalty.

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