How do I record IRS penalties?

From a pure accounting perspective, there is no way to post an expense and have it not appear on the Income and Loss statement, unless you classify the account as a Balance Sheet account.  If the payment is to be repaid to the company, you can charge it to a liability account on the Balance Sheet.

For the Income and Loss statement, I recommend setting up an account called "Non-deductible Expenses" and classifying it as an "Other Expense" so that your tax preparer knows to closely review the activity posted to this account.  If other expenses are paid which are not deductible for tax purposes, I post them to this account.  One example is parking tickets paid for company vehicles.

Thank you.