A Taxpayer's Return Is Audited and Additional Taxes Are Assessed

question 56

Multiple Choice

A taxpayer's return is audited and additional taxes are assessed. The IRS also asserts that a negligence penalty should be assessed. The taxpayer concurs with the additional $15,000 tax liability; $7,000 of this amount is attributable to negligence. What is the amount of the penalty for negligence?

• A)$700
• B)$1,400
• C)$5,600
• D)$1,750

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Definitions:

Appeal to Popularity

The appeal to popularity is a logical fallacy that suggests something is true, good, or desirable simply because it is popular or widely accepted by many people.

Complexity

The state or quality of being intricate or complicated.

Overconfidence

The psychological condition of having excessive confidence in one's own abilities or outcomes, often leading to mistakes.

Analogies

Comparisons made between different things to highlight their similarities, often used in reasoning and argumentation to illustrate a point or explain a concept.