The IRS who audited Mr. Kodak's 2009 Form 1040 assessed an $87,400 deficiency. If the agent believes that the entire deficiency was caused by Mr. Kodak's willful attempt to cheat the government, compute the resulting civil fraud penalty.

Question

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The civil fraud penalty is equal to 75% of the underpayment due to fraud. Thus, the civil fraud penalty in this case would be 75% of $87,400, which is $65,550.

The IRS Who Audited Mr