Question 1

As required by the Constitution, all tax bills are supposed to originate in the House of Representatives.

Accepted Answer

A) True 
 B)False

Question 2

Andy filed a fraudulent 2020 tax return on May 1, 2021. The statute of limitations for IRS assessment on Andy's 2020 tax return should end:

Accepted Answer

A)  May 1 st, 2024.
B)  April 15 th, 2024.
C)  May 1 st, 2027.
D)  April 15 th, 2027.
E)  None of the choices are correct.F) C) and D)
G) A) and D)

Question 3

Martin has never filed a 2020 tax return despite earning approximately $30,000 providing landscaping work in the community. In what tax year, will the statute of limitations expire for Martin's 2020 tax return?

Accepted Answer

A)  2023
B)  2024
C)  2027
D)  2028
E)  None of the choices are correct.F) C) and E)
G) C) and D)

Question 4

Kodak is a beginning tax researcher. He knows that the first step of the research process is to get an understanding of the facts surrounding the transaction being researched. Describe the two basic types of facts, the sources of facts for a research project, and any advice that may help Kodak.

Accepted Answer

To answer a tax question, you must under...

Question 5

Dominic earned $1,500 this year, and his employer withheld $200 of federal income tax from his salary. Assuming that Dominic is single, 30 years old, and will have zero tax liability this year, he:

Accepted Answer

A)  is required to file a tax return.
B)  is not required to file a tax return but should file a return anyway.
C)  is required to file a tax return but should not file because he owes no tax.
D)  is not required to file a tax return and should not file a return.
E)  None of the choices are correct.F) A) and E)
G) C) and E)

Question 6

If the president vetoes tax legislation, Congress:

Accepted Answer

A)  cannot override the president's veto.
B)  can override the president's veto with a 50 percent positive vote in the House and Senate.
C)  can override the president's veto with a two-thirds positive vote in the House and Senate.
D)  can override the president's veto with a 75 percent positive vote in the House and Senate.
E)  None of the choices are correct.F) A) and E)
G) B) and E)

Question 7

Which of the following is not considered a primary authority?

Accepted Answer

A)  Tax Court case
B)  Treasury Regulation
C)  Revenue ruling
D)  Tax service
E)  None of the choices are correct.F) A) and E)
G) A) and C)

Question 8

Which of the following courts is the only court that provides for a jury trial?

Accepted Answer

A)  Tax Court
B)  U) S. Court of Federal Claims
C)  U) S. District Court
D)  U) S. Circuit Court of Appeals
E)  None of the choices are correct.F) B) and E)
G) A) and D)

Question 9

Jaime recently found a "favorable" trial- level court opinion directly on point for her tax question. Which trial- level court would she prefer to have issued the opinion?

Accepted Answer

A)  Tax Court
B)  District Court
C)  Circuit Court
D)  Divorce Court
E)  None of the choices are correct.F) A) and B)
G) All of the above

Question 10

In general, a CPA will satisfy his professional responsibilities under the Statements on Standards for Tax Services when recommending a tax return position if he complies with the standards imposed by the applicable tax authority.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following types of tax services is arranged by code section?

Accepted Answer

A)  Legal tax service
B)  Annotated tax service
C)  Professional tax service
D)  Topical tax service
E)  None of the choices are correct.F) None of the above
G) B) and D)

Question 12

Under the tax law, taxpayers may be subject to both civil and criminal penalties for underpaying their tax liability (e.g., due to fraud).

Accepted Answer

A) True 
 B)False

Question 13

A tax practitioner can avoid IRS penalty relating to a tax return position:

Accepted Answer

A)  only if the position has a more likely than not chance of being sustained by the IRS or courts.
B)  if the position has a realistic possibility of being sustained by the IRS or courts.
C)  if there is not substantial authority to support the position.
D)  if the position has a reasonable basis and is disclosed on the tax return.
E)  None of the choices are correct.F) D) and E)
G) C) and D)

Question 14

Of the two basic types of tax services, beginning tax researchers often prefer topical tax services.

Accepted Answer

A) True 
 B)False

Question 15

Closed facts are especially conducive to tax planning.

Accepted Answer

A) True 
 B)False

Question 16

Kim has decided to litigate a tax issue with the IRS. Describe the trial-level courts that Kim may use to litigate the case.

Accepted Answer

There are three trial-level courts that ...

Question 17

Which of the following has the highest authoritative weight?

Accepted Answer

A)  Legislative regulation
B)  Private letter ruling
C)  Revenue ruling
D)  Action on decision
E)  Revenue procedureF) All of the above
G) A) and B)

Question 18

In a planning context,

Accepted Answer

A)  closed facts are preferred to open facts.
B)  new facts are preferred to old facts.
C)  old facts are preferred to new facts.
D)  open facts are preferred to closed facts.
E)  None of the choices are correct.F) All of the above
G) C) and D)

Question 19

Edie would like to better understand a new code section enacted four weeks ago. Which of the following authorities will help Edie understand the newly enacted code section?

Accepted Answer

A)  IRS regulations
B)  U) S. Tax Court cases
C)  Committee reports
D)  IRS revenue rulings
E)  None of the choices are correct.F) D) and E)
G) B) and E)

Question 20

For fraudulent tax returns, the statute of limitations for IRS assessment is 10 years.

Accepted Answer

A) True 
 B)False

Exam 2: Tax Compliance, the Irs, and Tax Authorities

Closed facts are especially conducive to tax planning.

Correct AnswerverifiedShow Answer

Edie would like to better understand a new code section enacted four weeks ago. Which of the following authorities will help Edie understand the newly enacted code section?

Correct AnswerverifiedShow Answer

In a planning context,

Correct AnswerverifiedShow Answer

Kim has decided to litigate a tax issue with the IRS. Describe the trial-level courts that Kim may use to litigate the case.

Correct AnswerverifiedThere are three trial-level courts that ...View AnswerShow Answer

Which of the following types of tax services is arranged by code section?

Correct AnswerverifiedShow Answer

In general, a CPA will satisfy his professional responsibilities under the Statements on Standards for Tax Services when recommending a tax return position if he complies with the standards imposed by the applicable tax authority.

Correct AnswerverifiedShow Answer

For fraudulent tax returns, the statute of limitations for IRS assessment is 10 years.

Correct AnswerverifiedShow Answer

Martin has never filed a 2020 tax return despite earning approximately $30,000 providing landscaping work in the community. In what tax year, will the statute of limitations expire for Martin's 2020 tax return?

Correct AnswerverifiedShow Answer

Dominic earned $1,500 this year, and his employer withheld $200 of federal income tax from his salary. Assuming that Dominic is single, 30 years old, and will have zero tax liability this year, he:

Correct AnswerverifiedShow Answer

Andy filed a fraudulent 2020 tax return on May 1, 2021. The statute of limitations for IRS assessment on Andy's 2020 tax return should end:

Correct AnswerverifiedShow Answer

Which of the following courts is the only court that provides for a jury trial?

Correct AnswerverifiedShow Answer

Under the tax law, taxpayers may be subject to both civil and criminal penalties for underpaying their tax liability (e.g., due to fraud).

Correct AnswerverifiedShow Answer

Kodak is a beginning tax researcher. He knows that the first step of the research process is to get an understanding of the facts surrounding the transaction being researched. Describe the two basic types of facts, the sources of facts for a research project, and any advice that may help Kodak.

Correct AnswerverifiedTo answer a tax question, you must under...View AnswerShow Answer

Which of the following has the highest authoritative weight?

Correct AnswerverifiedShow Answer

Of the two basic types of tax services, beginning tax researchers often prefer topical tax services.

Correct AnswerverifiedShow Answer

As required by the Constitution, all tax bills are supposed to originate in the House of Representatives.

Correct AnswerverifiedShow Answer

Jaime recently found a "favorable" trial- level court opinion directly on point for her tax question. Which trial- level court would she prefer to have issued the opinion?

Correct AnswerverifiedShow Answer

A tax practitioner can avoid IRS penalty relating to a tax return position:

Correct AnswerverifiedShow Answer

If the president vetoes tax legislation, Congress:

Correct AnswerverifiedShow Answer

Which of the following is not considered a primary authority?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
There are three trial-level courts that ...
View 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

Correct Answer
verified
To answer a tax question, you must under...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified