Exam 1: Introduction to Tax Practice and Ethics

Due diligence, in essence, means a tax practitioner:

Circular 230 bans tax practitioners from giving written advice on a federal tax issue based on the likelihood of an audit.

The Lowell Bar Association v. Loeb case addressed the issue of:

To become an enrolled agent, a person must either pass a special IRS examination or must work for the IRS for at least five years.

Which of the following statements best describes Circular 230?

Under Section 10.3, Subpart A, of Circular 230, the following individuals may practice before the IRS EXCEPT:

An EA must renew his or her enrollment card on a:

Enrolled actuaries are allowed to practice before the IRS.

CPAs may never disclose confidential taxpayer information under the AICPA rules.

Which of the following statements best explains the need for tax practitioners to understand nonregulatory ethical models of behavior?

Explain the AICPA guidelines under SSTS No. 3 for relying without verification on taxpayer or third-party information when preparing a tax return.

Explain the standards for professional services that involve tax return positions under SSTS No.1. What is the level of authority for disclosed or undisclosed positions and what types of authority can be relied upon?

Under Statements on Standards for Tax Services No. 3 (SSTS No. 3), a CPA preparing a tax return should perform all of the actions EXCEPT:

The Statements on Standards for Tax Services are:

In a closed transaction, the scope of tax planning is:

Under 2-2b rules, which of the following actions would constitute deceptive advertising?

Who may represent a taxpayer before the IRS in cases which go beyond the examination of the return?

Who can represent a taxpayer before the IRS Appeals Office under Circular 230?

An attorney, CPA, or enrolled agent may use advertising to obtain clients under Circular 230.

Which of the following statements is CORRECT regarding unauthorized practice of law?