The IRS computer automatically adds penalties to any unpaid tax. Thoughtless or punitive IRS agents will often do the same in routine audits. Typically, there may be multiple penalties. To make matters worse, the IRS also adds interest on unpaid penalties!
The Internal Revenue Code requires the IRS to set aside almost all of these penalties if a taxpayer can show a reasonable excuse for late payment, filing or deposit. Identifying that reasonable excuse — plus knowing when to present it and how to make the IRS to accept it — is critical, and should be done by an experienced tax representative.