Question 1

Tax return preparers can be penalized for the following activities except

Accepted Answer

A) failure to sign a return. 
B) failure to give a copy of the return to the taxpayer. 
C) failure to maintain IRS continuing education requirements. 
D) failure to provide the preparer's identification number on the return. 
A) failure to sign a return. 
B) failure to give a copy of the return to the taxpayer. 
C) failure to maintain IRS continuing education requirements. 
D) failure to provide the preparer's identification number on the return.

Question 2

A calendar-year individual taxpayer files last year's income tax return on October 17 of the current year.No extension was requested,and there is not a reasonable cause for the late filing.The return shows a balance due of $1,500 of tax.The late filing penalty is

Accepted Answer

A) $0. 
B) $75. 
C) $375. 
D) $450. 
A) $0. 
B) $75. 
C) $375. 
D) $450.

Question 3

Which of the following statements regarding Circular 230 is false?

Accepted Answer

A) Circular 230 applies to all tax return preparers. 
B) Circular 230 defines practice before the IRS. 
C) Circular 230 provides guidance as to the level of authority necessary for a CPA to take a tax return position. 
D) Circular 230 applies to CPAs,enrolled agents,enrolled actuaries,and attorneys. 
A) Circular 230 applies to all tax return preparers. 
B) Circular 230 defines practice before the IRS. 
C) Circular 230 provides guidance as to the level of authority necessary for a CPA to take a tax return position. 
D) Circular 230 applies to CPAs,enrolled agents,enrolled actuaries,and attorneys.

Question 4

Which one of the following statements about letter rulings is false?

Accepted Answer

A) If a taxpayer requests and pays for a ruling,the IRS must respond to his request by issuing a ruling. 
B) A ruling is a response to a taxpayer's specific set of facts. 
C) Rulings become public information. 
D) The IRS issues revenue procedures periodically,which prescribe the information that must be supplied with a ruling request. 
A) If a taxpayer requests and pays for a ruling,the IRS must respond to his request by issuing a ruling. 
B) A ruling is a response to a taxpayer's specific set of facts. 
C) Rulings become public information. 
D) The IRS issues revenue procedures periodically,which prescribe the information that must be supplied with a ruling request.

Question 5

A taxpayer who fails to file and fails to pay taxes is subject to a combined 5% monthly penalty on the underpayment.

Accepted Answer

A) True 
 B)False

Question 6

Identify which of the following statements is true.

Accepted Answer

A) If a taxpayer has been audited in at least one of the two previous years on the same item and the earlier audit did not result in any additional tax owed,the taxpayer may qualify for the special audit relief rule. 
B) A taxpayer can request and always receive an exemption from an audit by the IRS if his return was audited in at least one of the two previous years and the previous audit did not result in any change to his tax liability. 
C) The signing of Form 870 allows the taxpayer to wait for 30 interest-free days after the billing date to pay the tax. 
D) All of the above are true. 
A) If a taxpayer has been audited in at least one of the two previous years on the same item and the earlier audit did not result in any additional tax owed,the taxpayer may qualify for the special audit relief rule. 
B) A taxpayer can request and always receive an exemption from an audit by the IRS if his return was audited in at least one of the two previous years and the previous audit did not result in any change to his tax liability. 
C) The signing of Form 870 allows the taxpayer to wait for 30 interest-free days after the billing date to pay the tax. 
D) All of the above are true.

Question 7

An automatic extension of time from the regular filing date for an individual tax return may be received,without giving the IRS a reason,for

Accepted Answer

A) 2 months. 
B) 3 months. 
C) 4 months. 
D) 6 months. 
A) 2 months. 
B) 3 months. 
C) 4 months. 
D) 6 months.

Question 8

Identify which of the following statements is false.

Accepted Answer

A) A Technical Advice Memorandum may be requested by an IRS auditor if the transaction in question involves an especially complex tax issue. 
B) If the taxpayer being audited does not concur with the proposed assessment,the Service is required to send the taxpayer a 30-day letter detailing the proposed changes and the available appeals process. 
C) During the audit process,if the taxpayer concurs with the assessment of tax by the IRS and signs Form 870 (Waiver of Restrictions on Assessment and Collection of Deficiency in Tax),then the taxpayer is precluded from filing a refund suit. 
D) Interest on a deficiency accrues from the due date of the return through the payment date. 
A) A Technical Advice Memorandum may be requested by an IRS auditor if the transaction in question involves an especially complex tax issue. 
B) If the taxpayer being audited does not concur with the proposed assessment,the Service is required to send the taxpayer a 30-day letter detailing the proposed changes and the available appeals process. 
C) During the audit process,if the taxpayer concurs with the assessment of tax by the IRS and signs Form 870 (Waiver of Restrictions on Assessment and Collection of Deficiency in Tax),then the taxpayer is precluded from filing a refund suit. 
D) Interest on a deficiency accrues from the due date of the return through the payment date.

Question 9

The maximum failure to file penalty is a total of 25% of the underpayment.

Accepted Answer

A) True 
 B)False

Question 10

The statute of limitations,which stipulates the time frame within which either the government or the taxpayer may request a redetermination of tax due,usually expires 6 years after the date on which the return is filed.

Accepted Answer

A) True 
 B)False

Question 11

The innocent spouse relief provision from tax liability covers all of the following except

Accepted Answer

A) improper deductions. 
B) improper credits. 
C) improper basis. 
D) All are understatements subject to minimum thresholds. 
A) improper deductions. 
B) improper credits. 
C) improper basis. 
D) All are understatements subject to minimum thresholds.

Question 12

How does a taxpayer determine if "substantial authority" exists for a tax treatment the taxpayer desires to adopt?

Accepted Answer

A taxpayer should initially look to prim

Exam 15: Administrative Procedures

Tax return preparers can be penalized for the following activities except

A calendar-year individual taxpayer files last year's income tax return on October 17 of the current year.No extension was requested,and there is not a reasonable cause for the late filing.The return shows a balance due of $1,500 of tax.The late filing penalty is

Which of the following statements regarding Circular 230 is false?

Which one of the following statements about letter rulings is false?

A taxpayer who fails to file and fails to pay taxes is subject to a combined 5% monthly penalty on the underpayment.

Identify which of the following statements is true.

An automatic extension of time from the regular filing date for an individual tax return may be received,without giving the IRS a reason,for

Identify which of the following statements is false.

The maximum failure to file penalty is a total of 25% of the underpayment.

The statute of limitations,which stipulates the time frame within which either the government or the taxpayer may request a redetermination of tax due,usually expires 6 years after the date on which the return is filed.

The innocent spouse relief provision from tax liability covers all of the following except

How does a taxpayer determine if "substantial authority" exists for a tax treatment the taxpayer desires to adopt?

Tax Research

Corporate Formations and Capital Structure

The Corporate Income Tax

Corporate Nonliquidating Distributions

Other Corporate Tax Levies

Corporate Liquidating Distributions

Corporate Acquisitions and Reorganizations

Consolidated Tax Returns

Partnership Formation and Operation

Special Partnership Issues

S Corporations

The Gift Tax

The Estate Tax

Income Taxation of Trusts and Estates

U.S. Taxation of Foreign-Related Transactions

an Introduction to Taxation

Determination of Tax

Gross Income: Inclusions

Gross Income: Exclusions

Property Transactions: Capital Gains and Losses

Deductions and Losses

Business Expenses and Deferred Compensation

Itemized Deductions

Losses and Bad Debts

Depreciation,cost Recovery,amortization,and Depletion

Accounting Periods and Methods

Property Transactions: Nontaxable Exchanges

Property Transactions: Sec1231 and Recapture

Special Tax Computation Methods,tax Credits,and Payment of Tax

Tax Research

Corporations

Partnerships and S Corporations

Taxes and Investment Planning

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