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Question;2027. CHAPTER;17?TAX PRACTICE AND ETHICS Question MA #1-10 Match each of the following penalties;with the rate for that penalty as specified by the Code.Failure to file a;tax returnFraudulent failure to file a tax returnFailure to pay a;taxNegligenceImproper refund claimMisstatement of withholding allowancesCivil;tax fraudFailure to pay over a withheld taxSubstantial understatement of a;taxFailure by a tax preparer to sign the return5% per month, maximum 25% 15%;per month, maximum 75% 1/2% per month, maximum 25% 20% of tax due 20% of tax;due $500 per violation 75% of tax due 15% of tax due 10% of tax due $50 per;violation $1,000 per violation;[a] 1. Failure to file a tax return;[b] 2. Fraudulent failure to;file a tax return;[c] 3. Failure to pay a tax;[d] 4. Negligence;[e] 5. Improper refund claim;[f] 6. Misstatement of;withholding allowances;[g] 7. Civil tax fraud;[h] 8. Failure to pay over a;withheld tax;[i] 9. Substantial;understatement of a tax;[j] 10. Failure by a tax;preparer to sign the return;2028. CHAPTER;17?TAX PRACTICE AND ETHICS Question MA #11-18 For each of the indicated penalties;indicate the appropriate taxpayer defense.Negligence in filing a;returnSubstantial understatement of tax liabilityFailure to pay a tax that is;dueUndervaluation of a reported itemFiling an improper refund claimFailure to;deposit withholding taxPreparer penalty for taking an unreasonable tax return;positionPreparer penalty for reckless conductReasonable basis Substantial;authority Reasonable cause Reasonable cause Reasonable basis Reasonable cause;Reasonable cause Disclosure on return;[a] 1. Negligence in filing a return;[b] 2. Substantial;understatement of tax liability;[c] 3. Failure to pay a tax;that is due;[d] 4. Undervaluation of a;reported item;[e] 5. Filing an improper;refund claim;[f] 6. Failure to deposit;withholding tax;[g] 7. Preparer penalty for;taking an unreasonable tax return position;[h] 8. Preparer penalty for;reckless conduct;2029. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #1;The IRS is a subsidiary agency of the Department of the ____________________.;2030. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #2;About ____________________% of all Forms 1040 are audited each year. The rate;is about ____________________% if income exceeds $1 million.;2031. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #3;The IRS is one of the largest Federal agencies, employing at least;people throughout the year.;2032. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #4;According to the IRS, the annual ?Tax Gap? totals about $;billion.;2033. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #5;The IRS processes about ____________________ million individual tax returns;every year.;2034. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #6;The chief executive of the IRS is the _________________________.;2035. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #7;The ____________________, a presidential appointee, is the ?IRS attorney.?;2036. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #8;A(n) ____________________ should be requested when the taxpayer wants to know;the IRS interpretation of how the tax law will be applied to a proposed;transaction.;2037. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #9;The taxpayer might secure a(n) ____________________ to assure that a homeless;shelter qualifies for tax exempt treatment.;2038. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #10;During an audit, the IRS might require that the taxpayer produce the;that underlie the tax return data..;2039. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #11;After the completion of an audit, the taxpayer has ____________________ days to;petition the Tax Court to modify the proposed tax due.;2040. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #12;If the taxpayer refuses to pay an assessed tax, the IRS can seize taxpayer;property under the ____________________ process.;2041. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #13;The IRS can pay an informant?s fee of up to ____________________% of the;recovered tax, interest, and penalty amounts. In the typical year, about;such rewards are paid. The reward can be as high as;% for information provided by a ?whistle blower.?;2042. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #14;A taxpayer?s return might be selected for audit on the basis of the;score that the IRS computes.;2043. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #15;If the auditor comes to the taxpayer?s office to review a tax return, the;review is called a(n) ____________________ audit.;2044. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #16;In taking a dispute to the Appeals Division, a written protest is required of;the taxpayer when the proposed deficiency exceeds $____________________.;2045. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #17;A taxpayer can take a dispute to the Small Cases Division of the Tax Court when;the disputed amounts do not exceed $____________________.;2046. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #18;The taxpayer can use a(n) ____________________ to pay off a deficiency over a;longer period of time, if the IRS believes that this will facilitate the tax;collection process.;2047. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #19;The IRS pays interest on a refund to the taxpayer, unless the IRS?s payment is;made within ____________________ days of the date that a return is filed.;2048. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #20;A taxpayer can be subject to both ____________________ and;penalties for tax misconduct.;2049. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #21;If the taxpayer shows ____________________ for an underpayment of tax, the;failure to pay penalty can be reduced or eliminated.;2050. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #22;The accuracy-related penalties typically relate to ____________________on the;part of the taxpayer, or other understatements of tax.;2051. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #23;A negligence penalty can be waived if the taxpayer has used Form 8275 to;a tax return position that is contrary to a judicial;precedent.;2052. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #24;The IRS can waive the penalty for understating a tax liability if the taxpayer;shows ____________________ for the position taken on the tax return.;2053. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #25;A ____________________% penalty may result when a taxpayer overstates by;percent or more the value of an asset contributed to a;charity.;2054. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #26;The taxpayer can avoid a valuation penalty for overstating the value of the;charitable contribution of an artwork by showing that the deduction claimed was;based on a qualified ____________________.;2055. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #27;A penalty can be assessed from an appraiser who knew that his/her improper;appraisal would be used as part of a tax computation, in the amount of the;lesser of ____________________% of the tax understatement or;% of the appraisal fee collected.;2056. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #28;Quon filed an amended return, claiming a $100,000 refund. The IRS disallowed;the refund, and it can assess a penalty if there was no reasonable basis of;support for the refund claim, in the amount of ____________________% of the;disallowed amount.;2057. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #29;A C corporation is not subject to an underpayment penalty until more than;$____________________ is due and unpaid through estimated taxes.;2058. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #30;Maria?s AGI last year was $195,000. To avoid a penalty, her estimated tax;payments and withholdings for this year must equal the lesser of;percent of last year?s taxes or;percent of this year?s taxes.;2059. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #31;The general statute of limitations regarding Federal tax returns extends for;years. It is ____________________ years if a substantial;understatement of income is found, and ____________________ years with respect;to worthless securities.;2060. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #32;To file for a tax refund, an individual generally uses Form;2061. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #33;A CPA, an attorney, and a(n) ____________________ can represent taxpayers;before the IRS.;2062. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #34;The basic Treasury document regulating tax preparers is the Regulation known as;2063. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #35;A tax preparer can incur a penalty if the client?s return includes an;unreasonable or ___________________ tax return position that understates the;tax liability.;2064. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #36;For purposes of tax penalties, A VITA volunteer is not classified as a tax;2065. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #37;The tax preparer penalty for taking an unreasonable tax return position is the;greater of $1,000 or ____________________ of the tax professional?s income from;preparing the return.;2066. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #38;A(n) $____________________ penalty applies if the tax preparer does not sign;the client?s tax return.;2067. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #39;The Code?s scope of privileged communications for a CPA extends only to;advice given.;2068. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #40;According to AICPA rules, the CPA cannot take an aggressive tax return position;on the basis of the ?audit ____________________.?;2069. CHAPTER;17?TAX PRACTICE AND ETHICS Question CO #41;A(n) ___________________ member is required to follow the Statements of;Standards for Tax Services in conducting a tax practice.

 

Paper#59256 | Written in 18-Jul-2015

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