Tax Resources

IRS and Penalties

IRS penalties have come a long way since the beginning of the history of IRS tax penalties. In the past, there were just thirteen IRS penalties in the tax code in 1954. IRS and penalties have evolved and in 1988, a hundred and fifty IRS penalties were represented in the IRS tax laws. So, why the substantial increase in the number of IRS penalties provisions?

IRS and penalties in 1980s

In the late 1980s, Congress launched an inquiry into the jump in the number of IRS penalties over decades. After that, a legislation was passed aimed to reduce and restrict the number of IRS penalties. This legislation was not too effective as it only reduced the number of IRS penalties from about 150 penalties to about 140 IRS penalties. The number of IRS penalties is still at record high. IRS and penalties were known hand in hand.


IRS and penalties

What the 1980s legislation failed to do was to curb the indiscriminate manner the IRS used to assess IRS tax penalties and collect taxes. This caused more and more IRS penalties to be assessed. The IRS assessed IRS penalties and if you disagreed, it was up to you to prove that the IRS penalties were improper. The IRS did not need to prove anything. As a result, the IRS got away with imposing as much IRS penalties as they could come up with.

Most citizens did not know how to challenge the IRS and the imposition of IRS tax penalties and ended up paying the taxes and IRS penalties.

IRS and penalties in 1990s

In the 1990s, the same story of IRS and penalties continued. The number of IRS tax penalties continued to rise as the IRS assessed more and more IRS tax penalties against individual tax filers and businesses. Revenues collected by the IRS in the form of IRS tax penalties were at record high.

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