For the negligence penalty to apply,the underpayment must be caused by intentional disregard of rules and regulations with intent to defraud.

Question

Quizplus · Accepted Answer

The statement is incorrect as the negligence penalty can also be applied if the underpayment is due to a taxpayer's failure to make a reasonable attempt to comply with the tax laws or if the taxpayer fails to exercise ordinary and reasonable care in preparing their tax return. Intent to defraud is not a requirement for imposition of the negligence penalty.

For the Negligence Penalty to Apply,the Underpayment Must Be Caused