Tax Research Flashcards
What types of regulations are specifically authorized by Congress?
Legislative Regulations.
What court of original jurisdiction does not require prepayment of the disputed tax?
U.S. Tax Court.
What types of regulations have the weight of law for only three years?
Temporary Regulations.
Which committee must tax bills begin with?
House Ways and Means Committee.
What is the purpose of tax Form 870-AD?
Provides the settlement of the appellate conference related to a tax dispute
What document describes the rules that one must meet to be eligible to practice before the Internal Revenue Service (IRS)?
Circular 230.
What is the purpose of a 90-day letter?
The time that the taxpayer has to file a petition with the Tax Court once this letter is received.
Describe the concept of “offer in compromise.”
Allows a taxpayer to settle a tax liability for less than the actual amount owed.
List the scenarios in which no underpayment penalty is charged for underpayment of taxes owed.
No penalty is imposed if the tax due with the return is less than $1,000;
No penalty is imposed if the tax payments during the year were at least 90% of current year taxes or 100% of last year’s taxes (Watch over $150,000 AGI exception).
What is the due date of the tax return for individual returns?
15th day of 4th month after year-end;
If above falls on weekend or holiday, next business day;
Automatic 6 month extension.
By how long does an extension of corporate tax extend the due date of the corporate tax return?
Six months upon request.
What is the due date for corporate returns?
The 15th day of 3rd month following the end of the tax year.
List the various non-filing penalties a taxpayer may face.
5% per month of the tax due with the return;
The maximum penalty is 25% of the tax due. The minimum penalty for returns not filed within 60 days of the due date is the lesser of $135 or the amount of the tax due;
If the failure to file is fraudulent (intentional), the penalty is increased to 15% per month up to a maximum of 75% of the tax due with the return.
List the automatic deductions that are included on an individual’s tax return.
Personal exemption;
Standard deduction;
Increment to standard deduction for persons over 65.
What is the general statute of limitations for tax returns?
Three years from later of filing date or due date.
