<Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> <P> 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 . </P> <P> 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 . 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 . </P> <P> 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, 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 . </P>

Who may be affected by monetary penalties imposed by the internal revenue service (irs)
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