Part 3 Section 2 Circular 230

Question 1

What does the Principal of a CPA firm do if he can’t physically sign the return . Q 1 GD section 2

Answer 1

He can indicate “Unable to sign” as the signature

Question 2

Is a fiduciary considered a tax preparer? Q 8 GD (Google Docs) section 2

Answer 2

No. Under Section 770 (a)(36) a tax return preparer is any person who prepares for compensation, or employes other to prepare for compensation, any return or refund of tax imposed by the IRC. A fiduciary is specifically escluded from qualifying as a tax return preparer

Question 3

How long must information returns of income tax return preparers must be maintained for tax preparers? What are information returns

Answer 3

Information returns are like w-2, 1099s etc. A person who employs one or more tax return preparers to prepare a return or claim for refund must file a return setting fort the name, identifying number, and place of work of each income tax return preparer. Commissioner must be able to inspect for the 3 year period following the close of the return period to which that record relates. The return period means the 12-month period beginning July 1 of each year.

Question 4

Section 6060 Reporting requirements for tax return preparers, applies to any person who employs how many people?

The term “return period” means the month period beginning when?
Q 14

Answer 4

1 person or more

Begins July 1st of each year