A taxpayer is found guilty of criminal and civil fraud. The understatement due to the fraud was $10,000. The cost of prosecution was $15,000. What is the most (excluding interest) the taxpayer may have to pay in penalties? 1. Civil $7,500. Criminal $15,000 2. Civil $5,000. Criminal $5,000. The amount paid in penalties cannot exceed the total understatement. 3. Civil $7,500. Criminal $115,000 4. None of these choices