Question 1

The IRS:

Accepted Answer

A) facilitates the processing of tax returns 
B) enforces the internal revenue laws of the United States 
C) is a bureau within the U.S. Department of Finance 
D) all of these are correct 
A) facilitates the processing of tax returns 
B) enforces the internal revenue laws of the United States 
C) is a bureau within the U.S. Department of Finance 
D) all of these are correct

Question 2

A taxpayer's return is classified for audit after receiving a high DIF score and being manually screened by an IRS classifier. Which of the following statements best describes whether the taxpayer will be contacted by an auditor or revenue agent?

Accepted Answer

A) The taxpayer will be contacted since a high DIF score always will mean some type of audit. 
B) The taxpayer will be contacted because only the National Office has the power todecide that after screening, the return need not be audited. 
C) The taxpayer will not necessarily be contacted since after the Service Center review, it may be decided that an audit is unwarranted because the return will be manually inspected for audit determination. 
D) The taxpayer will not necessarily be contacted by an auditor or revenue agent since after the return is screened by the Service Center, it then is randomly selected for audit. 
A) The taxpayer will be contacted since a high DIF score always will mean some type of audit. 
B) The taxpayer will be contacted because only the National Office has the power todecide that after screening, the return need not be audited. 
C) The taxpayer will not necessarily be contacted since after the Service Center review, it may be decided that an audit is unwarranted because the return will be manually inspected for audit determination. 
D) The taxpayer will not necessarily be contacted by an auditor or revenue agent since after the return is screened by the Service Center, it then is randomly selected for audit.

Question 3

A taxpayer may be represented before the IRS only by attorneys.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is NOT a factor in favor of the Protest/Appeals Process?

Accepted Answer

A) An appeals officer can consider the hazards of litigation. 
B) The litigation path remains a possibility even if an appeal is pursued. 
C) The conclusion of the dispute, whether for or against the taxpayer, is expedited. 
D) The appeals process allows a further delay in the payment of the disputed tax. 
A) An appeals officer can consider the hazards of litigation. 
B) The litigation path remains a possibility even if an appeal is pursued. 
C) The conclusion of the dispute, whether for or against the taxpayer, is expedited. 
D) The appeals process allows a further delay in the payment of the disputed tax.

Question 5

The highest ranking legal adviser of the IRS is the:

Accepted Answer

A) Attorney General 
B) Chief Attorney 
C) District Attorney 
D) Chief Counsel 
A) Attorney General 
B) Chief Attorney 
C) District Attorney 
D) Chief Counsel

Question 6

Explain how the discriminant function system works.

Accepted Answer

Computer and manual methods are used tos

Question 7

Your client has just received an IRS summons toappear for an interview. The following statements are CORRECT concerning this interview EXCEPT:

Accepted Answer

A) Provided your client gives prior notice tothe IRS, the taxpayer may record the interview. 
B) The IRS may record the interview but must provide a transcript of the recording tothe taxpayer if he requests a copy and pays for the duplication charges. 
C) Notes may not be taken by either the IRS agent or the taxpayer during the interview. 
D) The IRS investigator must explain various taxpayer rights toyour client before commencing the interview. 
A) Provided your client gives prior notice tothe IRS, the taxpayer may record the interview. 
B) The IRS may record the interview but must provide a transcript of the recording tothe taxpayer if he requests a copy and pays for the duplication charges. 
C) Notes may not be taken by either the IRS agent or the taxpayer during the interview. 
D) The IRS investigator must explain various taxpayer rights toyour client before commencing the interview.

Question 8

The Commissioner of the Internal Revenue Service (IRS)is appointed by the:

Accepted Answer

A) President of the United States 
B) Secretary of the Treasury 
C) Senate 
D) Congress 
A) President of the United States 
B) Secretary of the Treasury 
C) Senate 
D) Congress

Question 9

Enumerate how the IRS conducts a field examination.

Accepted Answer

Examinations that present complex issues

Question 10

In absence of an administrative summons, a taxpayer cannot be required toaccompany the representative toan interview.

Accepted Answer

A) True 
 B)False

Question 11

A RAR contains a brief explanation of the proposed adjustments and lists the balance due or the overpayment.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following examinations involves complex issues that require more advanced knowledge of the internal revenue laws and accounting skills?

Accepted Answer

A) correspondence examination 
B) field examination 
C) office examination 
D) arithmetical error examination 
A) correspondence examination 
B) field examination 
C) office examination 
D) arithmetical error examination

Question 13

Towhom does the Chief Counsel of the Internal Revenue Service report?

Accepted Answer

A) Commissioner of the Internal Revenue Service 
B) Secretary of the Treasury 
C) Regional Council in National Office 
D) Attorney General 
A) Commissioner of the Internal Revenue Service 
B) Secretary of the Treasury 
C) Regional Council in National Office 
D) Attorney General

Question 14

Under various provisions of the Internal Revenue Code, what are some of the various rights guaranteed totaxpayers?

Accepted Answer

Answers will vary, but may include the f

Question 15

Individual taxpayers have less than a 1 percent chance of being audited.

Accepted Answer

A) True 
 B)False

Question 16

What are the "pros" and "cons" of filing a protest toan IRS Audit?

Accepted Answer

The advantages tofiling a protest are as

Question 17

The IRS examines each and every return critically in order togenerate additional revenue for the Treasury.

Accepted Answer

A) True 
 B)False

Question 18

Madison and Robyn sold a piece of property for $250,000, claiming that their basis was $100,000, and reported a taxable gain of $150,000. Their 2019 return filed in February 2020 reported gross income of $250,000. Madison and Robyn later determine that the property's basis was actually $25,000, not $100,000, resulting in a $75,000 understatement of income on the 2019 return. The statute of limitations period in which the IRS may assess additional tax in this situation expires on April 15 of what year?

Accepted Answer

A) 2022 
B) 2023 
C) 2026 
D) There is noexpiration date for the statute of limitations in this context. 
A) 2022 
B) 2023 
C) 2026 
D) There is noexpiration date for the statute of limitations in this context.

Question 19

"If a taxpayer cannot resolve his or her dispute with the IRS administratively, he or she may seek judicial relief." Explain how a taxpayer can seek relief through the judicial system.

Accepted Answer

If a taxpayer cannot resolve his or her

Question 20

Why would a taxpayer choose togotoDistrict Court or the Court of Federal Claims and not toU.S. Tax Court?

Accepted Answer

Since the District Court and the Court o

The IRS:

A taxpayer's return is classified for audit after receiving a high DIF score and being manually screened by an IRS classifier. Which of the following statements best describes whether the taxpayer will be contacted by an auditor or revenue agent?

A taxpayer may be represented before the IRS only by attorneys.

Which of the following is NOT a factor in favor of the Protest/Appeals Process?

The highest ranking legal adviser of the IRS is the:

Explain how the discriminant function system works.

Your client has just received an IRS summons toappear for an interview. The following statements are CORRECT concerning this interview EXCEPT:

The Commissioner of the Internal Revenue Service (IRS)is appointed by the:

Enumerate how the IRS conducts a field examination.

In absence of an administrative summons, a taxpayer cannot be required toaccompany the representative toan interview.

A RAR contains a brief explanation of the proposed adjustments and lists the balance due or the overpayment.

Which of the following examinations involves complex issues that require more advanced knowledge of the internal revenue laws and accounting skills?

Towhom does the Chief Counsel of the Internal Revenue Service report?

Under various provisions of the Internal Revenue Code, what are some of the various rights guaranteed totaxpayers?

Individual taxpayers have less than a 1 percent chance of being audited.

What are the "pros" and "cons" of filing a protest toan IRS Audit?

The IRS examines each and every return critically in order togenerate additional revenue for the Treasury.

"If a taxpayer cannot resolve his or her dispute with the IRS administratively, he or she may seek judicial relief." Explain how a taxpayer can seek relief through the judicial system.

Why would a taxpayer choose togotoDistrict Court or the Court of Federal Claims and not toU.S. Tax Court?

Introduction Totax Practice and Ethics

Tax Research Methodology

Constitutional and Legislative Sources

Administrative Regulations and Rulings

Judicial Interpretations

Thomson Reuters Checkpoint

CCH Intelliconnect

Other Tax Services and Tax Periodicals

Multijurisdictional Taxes

Communicating Research Results

Tax Planning

Tax Practice and Administration

Filters

Exam 12: Working With the IRS

The IRS:

A taxpayer's return is classified for audit after receiving a high DIF score and being manually screened by an IRS classifier. Which of the following statements best describes whether the taxpayer will be contacted by an auditor or revenue agent?

A taxpayer may be represented before the IRS only by attorneys.

Which of the following is NOT a factor in favor of the Protest/Appeals Process?

The highest ranking legal adviser of the IRS is the:

Explain how the discriminant function system works.

Your client has just received an IRS summons toappear for an interview. The following statements are CORRECT concerning this interview EXCEPT:

The Commissioner of the Internal Revenue Service (IRS)is appointed by the:

Enumerate how the IRS conducts a field examination.

In absence of an administrative summons, a taxpayer cannot be required toaccompany the representative toan interview.

A RAR contains a brief explanation of the proposed adjustments and lists the balance due or the overpayment.

Which of the following examinations involves complex issues that require more advanced knowledge of the internal revenue laws and accounting skills?

Towhom does the Chief Counsel of the Internal Revenue Service report?

Under various provisions of the Internal Revenue Code, what are some of the various rights guaranteed totaxpayers?

Individual taxpayers have less than a 1 percent chance of being audited.

What are the "pros" and "cons" of filing a protest toan IRS Audit?

The IRS examines each and every return critically in order togenerate additional revenue for the Treasury.

"If a taxpayer cannot resolve his or her dispute with the IRS administratively, he or she may seek judicial relief." Explain how a taxpayer can seek relief through the judicial system.

Why would a taxpayer choose togotoDistrict Court or the Court of Federal Claims and not toU.S. Tax Court?

Introduction Totax Practice and Ethics

Tax Research Methodology

Constitutional and Legislative Sources

Administrative Regulations and Rulings

Judicial Interpretations

Thomson Reuters Checkpoint

CCH Intelliconnect

Other Tax Services and Tax Periodicals

Multijurisdictional Taxes

Communicating Research Results

Tax Planning

Tax Practice and Administration

Filters