Sandy Sally is a sole proprietor CPA who runs a successful practice with five employees. Several years ago, Sally purchased an office building and relocated the practice in about 20 percent of the space and rented out the remaining portion. Things went well for the first few months, but then two of Sally’s tenants ran into financial difficulties and had to vacate the building. Sally was unable to quickly find new tenants for the space.
Sally struggled to keep current with the mortgage payments for a few months, but the loss of tenant income combined with the expense of operating a building became a large burden. Cash flow became very tight, and Sally stopped remitting the employee payroll taxes withheld.
The IRS filed a lien for nonpayment of employee payroll taxes, which was published in a local newspaper. A concerned citizen filed an ethics complaint.
Investigation found that although the company had been delinquent in remitting employee payroll taxes and a federal tax lien had been filed, Sally had brought the tax liabilities into current status and produced evidence that the IRS lien had been released.

Required:
a. What code violation(s) have occurred in this case?
b. What is the range of penalties that could be levied against Sally?
c. What do you think is the appropriate penalty?