who may be affected by monetary penalties imposed by the internal revenue service (irs)
IRS penalties 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 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.[1] 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.