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Exam 26: Tax Practice and Ethics

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Question 41

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A taxpayer can be subject to both ____________________ and ____________________ penalties for tax misconduct. or

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civil,crim...

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Question 42

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In a letter ruling,the IRS responds to a taxpayer request concerning the tax treatment of a proposed transaction.

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Question 43

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The accuracy-related penalties typically relate to ____________________on the part of the taxpayer,or other understatements of tax.

Mickey,a calendar year taxpayer,was not required to file a 2010 Federal income tax return.During 2011,his AGI is $120,000 and his tax liability is $20,000.To avoid a penalty for tax underpayments for 2011,Mickey must make aggregate estimated tax payments of at least:

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."

Neither the taxpayer nor the government can appeal a decision of the Tax Court Small Cases Division.

A tax preparer is in violation of Circular 230 if he or she:

CPA Jennifer has heard about the AICPA's Statements on Standards for Tax Services.Although Jennifer is a licensed CPA in her state,she is not a member of the AICPA.How do the Statements affect Jennifer's tax practice?

The Statements on Standards for Tax Services apply to members of the AICPA.

When a tax dispute is resolved,interest is paid by or to the government.List three or more features of the interest computations that arise when a tax return is audited.

For purposes of tax penalties,A VITA volunteer is not classified as a tax ____________________.

In a criminal fraud case,the burden is on the taxpayer to show that he or she was innocent "beyond the shadow of any reasonable doubt."

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 ____________________.

A taxpayer penalty may be waived if there is shown to be reasonable cause for the misstatement on the tax return.The courts have applied this standard strictly.List three or more assertions for a waiver of a taxpayer penalty that courts have found not to constitute reasonable cause.Example: Ignorance of the tax law.

A taxpayer can take a dispute to the Small Cases Division of the Tax Court when the disputed amounts do not exceed $____________________. or

Concerning the penalty for civil tax fraud:

The special tax penalty imposed on appraisers:

The IRS periodically updates its list of "audit initiatives," the areas of tax enforcement that will receive special attention during the current tax year.List five or more of the current IRS audit initiatives.

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.

Freddie has been assessed a preparer penalty for willful and reckless conduct.When he completed Peggy's Federal income tax return (who is in the 35% tax bracket) ,Freddie purposely omitted $100,000 of cash receipts that should have been reported as gross income.Freddie charged Peggy $6,000 to prepare the return.What is Freddie's preparer penalty?