Deck 21

Question 1

Primary authoritative sources does not include:

Answer 1

IRS publications

Question 2

Listed transaction

Answer 2

Identified by the Secretary of the U.S. Treasury Department; tax avoidance transaction

Question 3

More likely than not

Answer 3

> 50%

Question 4

Reasonable Basis

Answer 4

> 20%

Question 5

Substantial Authority

Answer 5

> 33% but less than 50%

Question 6

Tax return preparer

Answer 6

Any person wo prepares for compensation or employs a person to prepare for compensation or any claim for refund

Question 7

Tax practitioner

Answer 7

Individuals who practice before the IRS: attorneys, CPAs, enrolled agents

Question 8

Tax shelter

Answer 8

Plan or arrangement with a significant purpose to have tax avoidance or tax evasion

Question 9

Tax preparer is required to keep records for how long?

Answer 9

3 years

Question 10

Circular 230

Answer 10

General rules that apply to tax practitioners

Question 11

What group can seek criminal penalties?

Answer 11

Internal Revenue Service (IRS)

Question 12

The penalty for failure to file a tax return by the due date is:

Answer 12

5% per month or fraction of month on the amount of tax shown as due on the return

Question 13

The penalty for failure to pay by the due date is:

Answer 13

1/2% per month based on the amount due on the return

Question 14

In civil tax cases, who bears the burden of the proof?

Answer 14

The taxpayer

Question 15

Which senate considers new tax legislation?

Answer 15

Finance committee

Question 16

What does it mean to issue a “no change” report?

Answer 16

The IRS generally does not reopen the examination except in cases involving fraud or other similar misrepresentation

Question 17

Where does tax law originate?

Answer 17

House of Representatives

Question 18

What groups of taxpayers are more subject to audit under the Discriminant Inventory Function System (DIF)?

Answer 18

Individuals with gross income greater than $100,000; self-employed individuals; and cash businesses

Question 19

Who’s can settle an unresolved issue based on the probability of winning the case in court?

Answer 19

Appeals division; not a revenue agent

Question 20

What does a taxpayer need to take a case to the U.S. Tax Court?

Answer 20

Notice of Deficiency