REG 1 Flashcards
A tax return preparer, who prepares a return or refund claim, which includes an “unreasonable position,” must pay a penalty of the greater of $1,000 or 50% of the income derived by the preparer for preparing the return (50% × $1,000 = $500). A position is unreasonable if there is not substantial authority for it. There is an exception to this rule if the position was disclosed and there is a reasonable basis for it.
A tax return preparer, who prepares a return or refund claim, which includes an “unreasonable position,” must pay a penalty of the greater of $1,000 or 50% of the income derived by the preparer for preparing the return (50% × $1,000 = $500). A position is unreasonable if there is not substantial authority for it. There is an exception to this rule if the position was disclosed and there is a reasonable basis for it.
If the understated tax liability is due to an unreasonable position and the preparer WILLFULLY attempts to understate the tax liability or recklessly or intentionally disregards rules or regulations, the penalty is the greater of $5,000 or 75% of the income earned by the tax preparer for preparing the return or claim (75% × $1,000 = $750).
If the understated tax liability is due to an unreasonable position and the preparer WILLFULLY attempts to understate the tax liability or recklessly or intentionally disregards rules or regulations, the penalty is the greater of $5,000 or 75% of the income earned by the tax preparer for preparing the return or claim (75% × $1,000 = $750).
If a preparer takes a position on a return that understates the true tax liability, the preparer will not be subject to a penalty if the position taken has substantial authority. However, if the position is disclosed on the return on Form 8275, then no penalty is assessed as long as there is a reasonable basis for the position.
If a preparer takes a position on a return that understates the true tax liability, the preparer will not be subject to a penalty if the position taken has substantial authority. However, if the position is disclosed on the return on Form 8275, then no penalty is assessed as long as there is a reasonable basis for the position.
Express authority is the authority which the principal has expressly given to the agent whether orally or in writing. Implied authority (sometimes described as usual authority) is the authority of an agent to do acts which are reasonably incidental to and necessary for the effective performance of his duties.
Express authority is the authority which the principal has expressly given to the agent whether orally or in writing. Implied authority (sometimes described as usual authority) is the authority of an agent to do acts which are reasonably incidental to and necessary for the effective performance of his duties.
Title and risk of loss do not necessarily pass to a buyer at the same time. In this case, risk of loss remained with the seller because of the shipment of nonconforming goods. However, title passed under the original terms despite the breach of contract for sending nonconforming goods
Title and risk of loss do not necessarily pass to a buyer at the same time. In this case, risk of loss remained with the seller because of the shipment of nonconforming goods. However, title passed under the original terms despite the breach of contract for sending nonconforming goods
A company is obligated to follow any reasonable instructions of the seller as a merchant who rejects goods, even nonconforming, under a contract (ie sending rotted peaches when ripe peaches were ordered. The seller asking the buyer to send the rotted peaches back at the the seller’s expense is a reasonable request)
A company is obligated to follow any reasonable instructions of the seller as a merchant who rejects goods, even nonconforming, under a contract (ie sending rotted peaches when ripe peaches were ordered. The seller asking the buyer to send the rotted peaches back at the the seller’s expense is a reasonable request)
Risk of loss would normally pass to the buyer under a shipment contract. However, if the seller, breached the contract, risk of loss remains with seller.
Risk of loss would normally pass to the buyer under a shipment contract. However, if the seller, breached the contract, risk of loss remains with seller.
A voidable contract is a formal agreement between two parties that may be rendered unenforceable for a number of legal reasons. Reasons that can make a contract voidable include the following:
1, Failure by one or both parties to disclose a material fact
- A mistake, misrepresentation or fraud
- Undue influence or duress
- One party’s legal incapacity to enter a contract
- One or more terms that are unconscionable
- A breach of contract
A voidable contract is a formal agreement between two parties that may be rendered unenforceable for a number of legal reasons. Reasons that can make a contract voidable include the following:
1, Failure by one or both parties to disclose a material fact
- A mistake, misrepresentation or fraud
- Undue influence or duress
- One party’s legal incapacity to enter a contract
- One or more terms that are unconscionable
- A breach of contract
An INDEMNITY CONTRACT is not a suretyship contract. Instead it is a contract involving two parties in which the first party agrees to indemnify and reimburse the second party for covered debts or losses should they take place. (One party promises to reimburse debtor for payment of debt or loss if it arises.)
An INDEMNITY CONTRACT is not a suretyship contract. Instead it is a contract involving two parties in which the first party agrees to indemnify and reimburse the second party for covered debts or losses should they take place. (One party promises to reimburse debtor for payment of debt or loss if it arises.)
The SURETYSHIP CONTRACT involves three parties. The surety agrees with the creditor to pay for the debt or default if the debtor does not. (Relationship whereby one person agrees to answer for the debt or default of another.)
The SURETYSHIP CONTRACT involves three parties. The surety agrees with the creditor to pay for the debt or default if the debtor does not. (Relationship whereby one person agrees to answer for the debt or default of another.)
The SURETY is the party that agrees to pay the creditor if the debtor defaults. (Promises to pay debt on default of principal debtor.)
The SURETY is the party that agrees to pay the creditor if the debtor defaults. (Promises to pay debt on default of principal debtor.)
When two or more sureties agree to be sureties for the same obligation to the same creditor, they are known as COSURETIES. They have joint and several liability.
When two or more sureties agree to be sureties for the same obligation to the same creditor, they are known as COSURETIES. They have joint and several liability.
Cosureties are liable in contribution for their proportionate shares of the debt. If a cosurety pays more than this amount, s/he may seek CONTRIBUTION for the excess from the other cosureties. (Upon payment of more than his/her proportionate share, each cosurety may compel other cosureties to pay their shares.)
Cosureties are liable in contribution for their proportionate shares of the debt. If a cosurety pays more than this amount, s/he may seek CONTRIBUTION for the excess from the other cosureties. (Upon payment of more than his/her proportionate share, each cosurety may compel other cosureties to pay their shares.)
The right of REIMBURSEMENT is against the debtor to collect any amounts paid by the surety. (Upon payment of debt, surety may recover payment from debtor.)
The right of REIMBURSEMENT is against the debtor to collect any amounts paid by the surety. (Upon payment of debt, surety may recover payment from debtor.)
SUBROGATION - When the surety pays the creditor, it “steps into the shoes of the creditor” and obtains the same rights against the debtor that the creditor had. (Upon payment, surety obtains same rights against debtor that creditor had.)
SUBROGATION - When the surety pays the creditor, it “steps into the shoes of the creditor” and obtains the same rights against the debtor that the creditor had. (Upon payment, surety obtains same rights against debtor that creditor had.)
