Receiving notice of an IRS levy or lien can be a very frightening time. Just the thought of the IRS seizing all of the money in your bank account(s) or taking your state income tax refund or any payments you may normally receive from the federal government can be unbearable. When an IRS levy, such [...]
The first step is to determine why the IRS assessed a penalty, and look for the mistakes they might have made.
Taxpayers are usually penalized for one of three possible situations: A mistake on the income tax return, filing returns or paying taxes late, or fraud.
If the IRS has accused you of one of the first two causes, it may be very easy to wipe out your tax penalties. In the case of fraud, you may be able to obtain penalty abatement by demonstrated that you acted in good faith to the best of your knowledge.