Question 1

LaCharles made a charitable contribution of property that he valued at $80,000. He deducted this amount as an itemized deduction on his tax return. The IRS can show that the actual value of the property is $50,000. LaCharles is in the 32% Federal income tax bracket. Determine the amount due for any penalty.

Accepted Answer

The § 6662 penalty for an individual app...

Question 2

A(n) must obtain a Preparer Tax Identification Number (PTIN).

Accepted Answer

The answer of A(n) must obtain a Preparer Tax Identification...

Question 3

Circular 230 requires that a paid tax preparer apply a quality review system in preparing tax returns for her or his clients.

Accepted Answer

A) True 
 B)False

Question 4

A CPA, an attorney, or a(n) can represent taxpayers before the IRS in an Appeals conference.

Accepted Answer

The answer of A CPA, an attorney, or a(n) can...

Question 5

The Commissioner of the IRS is appointed by the:

Accepted Answer

A)   Secretary of the Treasury Department.
B)   U. S. President.
C)   U. S. House of Representatives.
D)   U. S. Senate.
E)   SEC Commissioner.F) A) and D)
G) A) and E)

Question 6

The IRS employs about 75,000 personnel, making it one of the largest Federal agencies.

Accepted Answer

A) True 
 B)False

Question 7

Describe the potential outcomes to a party who provides information to the IRS under the informant or whistleblower program.

Accepted Answer

An informant may qualify for a discretio...

Question 8

Concerning a taxpayer's requirement to make quarterly estimated tax payments:

Accepted Answer

A)   A C corporation must make estimated payments if its Federal income tax liability for the year will exceed $250.
B)   The due dates of the payments for a calendar year C corporation are March, June, September, and December 15.
C)   A C corporation's estimates must total at least 90% of the current-year tax to avoid the penalty.
D)   An individual must make estimated payments if his or her balance due for the Federal income tax for the year will exceed $1,000.E) C) and D)
F) B) and D)

Question 9

Jake, an individual calendar year taxpayer, incurred the following transactions.  Gross receipts $800,000 Less: Cost of sales(300,000) Net business income $500,000Capital gain $30,000Capital loss (90,000) (60,000) Total income $440,000\begin{array} { l  }  	ext {Gross receipts }&&\$800,000\ 	ext { Less: Cost of sales}&&(300,000) \ 	ext {Net business income }&&\$500,000\ 	ext {Capital gain }&\$30,000\ 	ext {Capital loss }&(90,000) &(60,000) \ 	ext {Total income }&&\$440,000\\end{array}Gross receipts  Less: Cost of salesNet business income Capital gain Capital loss Total income ​$30,000(90,000) ​$800,000(300,000) $500,000(60,000) $440,000​ 
 Assuming that any error in timely reporting these amounts was inadvertent, how much omission from gross income would be required before the six-year statute of limitations would apply?

Accepted Answer

A)   More than $110,000.
B)   More than $132,500.
C)   More than $200,000.
D)   More than $207,500.
E)   The six-year rule does not apply here. F) D) and E)
G) None of the above

Question 10

A(n) $ penalty applies if the tax preparer does not sign the client's tax return.

Accepted Answer

The answer of A(n) $ penalty applies if the tax...

Question 11

The IRS is organized according to the industry classification of the taxpayer. One of the operating divisions of the
IRS deals exclusively with manufacturing and exporting businesses.

Accepted Answer

A) True 
 B)False

Question 12

Jaime's negligence penalty will be waived under the reasonable cause exception. He told the court, "My taxes were wrong because I couldn't understand the tax law."

Accepted Answer

A) True 
 B)False

Question 13

The usual three-year statute of limitations on additional tax assessments applies in the following situation(s) .

Accepted Answer

A)   No return at all is filed.
B)   An investment in a marketable security is worthless.
C)   A taxpayer discovers an inadvertent overstatement of deductions equal to 30% of gross income.
D)   A taxpayer inadvertently omits an amount of gross income equal to 30% of the gross income stated on the return.E) B) and D)
F) All of the above

Question 14

The IRS can pay an informant's fee of up to % of the recovered tax, interest, and penalty amounts. The reward can be as high as % for information provided by a whistleblower.

Accepted Answer

The answer of The IRS can pay an informant's fee...

Exam 26: Tax Practice and Ethics

The IRS can pay an informant's fee of up to % of the recovered tax, interest, and penalty amounts. The reward can be as high as % for information provided by a whistleblower.

Correct Answer
verified

Correct Answer
verified

The IRS is organized according to the industry classification of the taxpayer. One of the operating divisions of the IRS deals exclusively with manufacturing and exporting businesses.

Correct Answer
verified

The Commissioner of the IRS is appointed by the:

Correct Answer
verified

A(n) must obtain a Preparer Tax Identification Number (PTIN).

Correct Answer
verified

Circular 230 requires that a paid tax preparer apply a quality review system in preparing tax returns for her or his clients.

Correct Answer
verified

A(n) $ penalty applies if the tax preparer does not sign the client's tax return.

Correct Answer
verified

Describe the potential outcomes to a party who provides information to the IRS under the informant or whistleblower program.

Correct Answer
verified
An informant may qualify for a discretio...
View Answer

Jaime's negligence penalty will be waived under the reasonable cause exception. He told the court, "My taxes were wrong because I couldn't understand the tax law."

Correct Answer
verified

The IRS employs about 75,000 personnel, making it one of the largest Federal agencies.

Correct Answer
verified

A CPA, an attorney, or a(n) can represent taxpayers before the IRS in an Appeals conference.

Correct Answer
verified

Correct Answer
verified
The § 6662 penalty for an individual app...
View Answer

The usual three-year statute of limitations on additional tax assessments applies in the following situation(s) .

Correct Answer
verified

Concerning a taxpayer's requirement to make quarterly estimated tax payments:

Correct Answer
verified

Exam 26: Tax Practice and Ethics

The IRS can pay an informant's fee of up to % of the recovered tax, interest, and penalty amounts. The reward can be as high as % for information provided by a whistleblower.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The IRS is organized according to the industry classification of the taxpayer. One of the operating divisions of the IRS deals exclusively with manufacturing and exporting businesses.

Correct AnswerverifiedShow Answer

The Commissioner of the IRS is appointed by the:

Correct AnswerverifiedShow Answer

A(n) must obtain a Preparer Tax Identification Number (PTIN).

Correct AnswerverifiedShow Answer

Circular 230 requires that a paid tax preparer apply a quality review system in preparing tax returns for her or his clients.

Correct AnswerverifiedShow Answer

A(n) $ penalty applies if the tax preparer does not sign the client's tax return.

Correct AnswerverifiedShow Answer

Describe the potential outcomes to a party who provides information to the IRS under the informant or whistleblower program.

Correct AnswerverifiedAn informant may qualify for a discretio...View AnswerShow Answer

Jaime's negligence penalty will be waived under the reasonable cause exception. He told the court, "My taxes were wrong because I couldn't understand the tax law."

Correct AnswerverifiedShow Answer

The IRS employs about 75,000 personnel, making it one of the largest Federal agencies.

Correct AnswerverifiedShow Answer

A CPA, an attorney, or a(n) can represent taxpayers before the IRS in an Appeals conference.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe § 6662 penalty for an individual app...View AnswerShow Answer

The usual three-year statute of limitations on additional tax assessments applies in the following situation(s) .

Correct AnswerverifiedShow Answer

Concerning a taxpayer's requirement to make quarterly estimated tax payments:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
An informant may qualify for a discretio...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The § 6662 penalty for an individual app...
View Answer

Correct Answer
verified

Correct Answer
verified