Question 1

Which of the following audits is the least common, broadest in scope, and typically most complex?

Accepted Answer

A)  Correspondence.
B)  Targeted.
C)  Office.
D)  Field.
E)  None of the choices are correct.F) B) and C)
G) B) and D)

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

Tyrone claimed a large amount of charitable contributions as a tax deduction relative to taxpayers with similar levels of income.If Tyrone's tax return is chosen for audit because of his large charitable contributions, which audit program likely identified Tyrone's tax return for audit?

Accepted Answer

A)  DIF system.
B)  Deduction Detective.
C)  Document perfection.
D)  Information matching.
E)  None of the choices are correct.F) A) and E)
G) C) and E)

Question 4

Princess, who resides in the 2nd Circuit, recently found a circuit court case that is favorable to her income tax research question.Which of the following circuits would she prefer to have issued the opinion?

Accepted Answer

A)  2nd Circuit.
B)  Federal Circuit.
C)  1st Circuit.
D)  2nd Circuit or the Federal Circuit.
E)  None of the choices are correct.F) B) and D)
G) A) and C)

Question 5

A taxpayer can avoid a substantial understatement of tax penalty:

Accepted Answer

A)  if the position is frivolous and disclosed on the tax return.
B)  if the position has a realistic possibility of being sustained by the IRS or courts.
C)  if the position is not frivolous and disclosed on the tax return.
D)  if the position has a reasonable basis and is disclosed on the tax return.
E)  None of the choices are correct.F) None of the above
G) All of the above

Question 6

Generally, code sections are arranged (grouped together) :

Accepted Answer

A)  chronologically.
B)  by topic.
C)  randomly.
D)  by length.
E)  None of the choices are correct.F) A) and D)
G) A) and C)

Question 7

Which of the following is not a common tool used in conducting tax research?

Accepted Answer

A)  citator.
B)  annotated tax service.
C)  topical tax service.
D)  keyword search.
E)  None of the choices are correct.F) A) and B)
G) C) and D)

Question 8

Corporations are required to file a tax return annually regardless of their taxable income.

Accepted Answer

A) True 
 B)False

Question 9

Dan received a letter from the IRS that gave him the choice of (1) requesting a conference with an appeals officer or (2) agreeing to a proposed tax adjustment.Dan received the:

Accepted Answer

A)  30-day letter.
B)  90-day letter.
C)  Appeals letter.
D)  Tax adjustment letter.
E)  None of the choices are correct.F) D) and E)
G) A) and D)

Question 10

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) B) and D)
G) D) and E)

Question 11

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 12

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) B) and D)
G) C) and E)

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

Which of the following is not a common tool used in conducting tax research?

Correct Answer
verified

Princess, who resides in the 2^nd Circuit, recently found a circuit court case that is favorable to her income tax research question.Which of the following circuits would she prefer to have issued the opinion?

Correct Answer
verified

A taxpayer can avoid a substantial understatement of tax penalty:

Correct Answer
verified

Which of the following audits is the least common, broadest in scope, and typically most complex?

Correct Answer
verified

Dan received a letter from the IRS that gave him the choice of (1) requesting a conference with an appeals officer or (2) agreeing to a proposed tax adjustment.Dan received the:

Correct Answer
verified

In a planning context,

Correct Answer
verified

Tyrone claimed a large amount of charitable contributions as a tax deduction relative to taxpayers with similar levels of income.If Tyrone's tax return is chosen for audit because of his large charitable contributions, which audit program likely identified Tyrone's tax return for audit?

Correct Answer
verified

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

Correct Answer
verified

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 Answer
verified

Generally, code sections are arranged (grouped together) :

Correct Answer
verified

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 Answer
verified

Corporations are required to file a tax return annually regardless of their taxable income.

Correct Answer
verified

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

Which of the following is not a common tool used in conducting tax research?

Correct AnswerverifiedShow Answer

Princess, who resides in the 2nd Circuit, recently found a circuit court case that is favorable to her income tax research question.Which of the following circuits would she prefer to have issued the opinion?

Correct AnswerverifiedShow Answer

A taxpayer can avoid a substantial understatement of tax penalty:

Correct AnswerverifiedShow Answer

Which of the following audits is the least common, broadest in scope, and typically most complex?

Correct AnswerverifiedShow Answer

Dan received a letter from the IRS that gave him the choice of (1) requesting a conference with an appeals officer or (2) agreeing to a proposed tax adjustment.Dan received the:

Correct AnswerverifiedShow Answer

In a planning context,

Correct AnswerverifiedShow Answer

Tyrone claimed a large amount of charitable contributions as a tax deduction relative to taxpayers with similar levels of income.If Tyrone's tax return is chosen for audit because of his large charitable contributions, which audit program likely identified Tyrone's tax return for audit?

Correct AnswerverifiedShow Answer

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

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

Generally, code sections are arranged (grouped together) :

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

Corporations are required to file a tax return annually regardless of their taxable income.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Princess, who resides in the 2^nd Circuit, recently found a circuit court case that is favorable to her income tax research question.Which of the following circuits would she prefer to have issued the opinion?

Correct Answer
verified

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Correct Answer
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Correct Answer
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