Tax Practice and Procedure Practice Exam
Course Introduction
This course provides an in-depth exploration of tax practice and procedure, focusing on the practical application of tax laws and regulations in the context of compliance, audits, and dispute resolution. Students will examine the structure and function of the Internal Revenue Service (IRS), tax return filing requirements, assessment and collection processes, and procedures related to tax examinations and appeals. The course emphasizes ethical considerations, taxpayer rights, and strategies for effective representation before tax authorities. Through real-world case studies and practical exercises, students develop essential skills for navigating the complexities of tax administration and ensuring compliance with federal tax laws.
Recommended Textbook
Federal Tax Research 11th Edition by Roby B. Sawyers
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14 Chapters
691 Verified Questions
691 Flashcards
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Chapter 1: Introduction to Tax Practice and Ethics
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54 Verified Questions
54 Flashcards
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Sample Questions
Q1) A CPA can rely without verification on information given to the CPA by a taxpayer unless the information appears to be incorrect.
A)True
B)False
Answer: True
Q2) Tax evasion is:
A)a fraudulent act involving illegal nonpayment of taxes
B)one of the objectives of tax planning
C)an act of deferring tax payments to future periods
D)the same as tax avoidance as both of them result in nonpayment of taxes
Answer: A
Q3) The Statements on Standards for Tax Services are:
A)part of the ABA Code of Professional Responsibility
B)intended to replace Circular 230
C)intended to supplement the AICPA Code of Professional Conduct and Circular 230
D)none of these are correct
Answer: C
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Page 3
Chapter 2: Tax Research Methodology
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49 Verified Questions
49 Flashcards
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Sample Questions
Q1) All of the following are goals of tax research EXCEPT:
A)to balance the need for efficiency against the need for thoroughness
B)to balance the client's tax goals with the client's nontax, personal considerations
C)to find a defensible solution to a client's problem
D)to find a perfect solution to a client's problem, no matter how long it takes
Answer: D
Q2) A statutory source of federal tax law is:
A)various rulings of the Treasury Department and the IRS
B)collected rulings of the various courts on federal tax matters
C)textbooks
D)tax treaties
Answer: D
Q3) Thomson Reuters Checkpoint is a web-based tax research service that contains research material on federal, state, local, and international taxation.
A)True
B)False
Answer: True
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Chapter 3: Constitutional and Legislative Sources
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49 Verified Questions
49 Flashcards
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Sample Questions
Q1) A subtitle of the Internal Revenue Code:
A)is indicated by a capital letter, such as "Subtitle A"
B)relates to a well-defined area of the law
C)is used as a short-hand reference to describe types of corporations
D)is indicated by a capital letter, such as "Subtitle A," and relates to a well-defined area of the law
E)all of the above
Answer: D
Q2) Historically, the 1913 income tax was a tax on wealthy and high-income taxpayers.
A)True
B)False
Answer: True
Q3) Which of the following statements is INCORRECT regarding tax treaties?
A)They are authorized by the U.S. Constitution.
B)They are usually initiated by the State Department, not the Treasury.
C)The United States can have multiple types of tax treaties with one country.
D)All of these are correct.
Answer: B
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5
Chapter 4: Administrative Regulations and Rulings
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49 Flashcards
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Sample Questions
Q1) The Internal Revenue Bulletin would include:
A)new tax laws issued by Congress
B)actions on decisions
C)tax treaties
D)IRS notices
E)all of these are correct
Q2) In the citation Rev Rul. 87-90, 1987-1 CB 198, the number "90" is the:
A)ruling number for the year
B)year of ruling
C)paragraph number in the CB
D)volume number in the CB
Q3) An acquiescence indicates that a court decision will be:
A)appealed by the IRS
B)followed in similar situations only if it favors the IRS
C)followed in similar situations, even if it is adverse to the IRS
D)ignored by the IRS
Q4) IRS publications are published in the monthly Internal Revenue Bulletin as well as on the IRS website.
A)True
B)False
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Chapter 5: Judicial Interpretations
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49 Flashcards
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Sample Questions
Q1) An appeal from any of the Circuit Courts of Appeals is to the:
A)U.S. District Court
B)U.S. Court of Federal Claims
C)Court of Appeals for the Federal Circuit
D)U.S. Supreme Court
Q2) Either the taxpayer or the IRS may initiate legal proceedings in the federal court system.
A)True
B)False
Q3) The two levels of appellate courts in the federal court system are the U.S. Courts of Appeals and the U.S. Supreme Court.
A)True
B)False
Q4) District Court decisions can vary significantly among the districts.
A)True
B)False
Q5) There are 11 Circuit Courts of Appeals in the federal court system.
A)True
B)False
Q6) Briefly explain how the burden of proof concept is applied.
Page 7
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Chapter 6: Tax Services Ria Checkpoint
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43 Verified Questions
43 Flashcards
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Sample Questions
Q1) Thomson Reuters Checkpoint offers two main types of keyword searches: Terms & Connectors and Intuitive Search.
A)True
B)False
Q2) The database which is organized by the numerical structure of Code is the:
A)topical database
B)IRS database
C)Court cases database
D)annotated database
Q3) In some tax services, quotation marks are placed around the keywords to:
A)reduce the number of documents retrieved
B)indicate that the words should be searched separately
C)maximize the number of documents retrieved
D)indicate that the words should be searched as an exact phrase
Q4) The tax research platform "Checkpoint" is a product of which publisher?
A)CCH
B)Thomson Reuters
C)BNA Tax & Accounting
D)none of the these are correct
Q5) Describe the four common search methods used in Thomson Reuters Checkpoint.
Page 8
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Chapter 7: Tax Services CCH Intelliconnect
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46 Verified Questions
46 Flashcards
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Sample Questions
Q1) Practitioners may use the author of a treatise or article as a research associate thereby:
A)using them as primary sources
B)waiting for the right article to be found
C)learning how to research IntelliConnect
D)saving hours of research time
Q2) The case that is referred to in the opinion of another case is called the "precedent." A)True
B)False
Q3) Tax treatises and periodicals are:
A)controlling authority
B)secondary sources
C)primary sources
D)updated daily
Q4) Describe the Boolean connectors, proximity connectors, and wildcard characters available in IntelliConnect.
Q5) A citation search is different from a citator. A)True B)False
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Chapter 8: Tax Services Specialty and Others
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47 Verified Questions
47 Flashcards
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Sample Questions
Q1) The publications containing a variety of articles and news briefs that are designed to keep readers up to date in specific or general areas of the tax law are called:
A)Law Publisher's best
B)Tax Periodicals
C)Law Review
D)Taxation Legal
Q2) One of the most important tax newsletters available to practitioners is the BNA Daily Tax Report (DTR). DTR is available online; through wireless devices, including iPhones; and in hard copy.
A)True
B)False
Q3) The service LexisNexis offers to academic institutions and public libraries which is a customized version of its services is called:
A)KeyCite
B)Tax Center
C)KeySearch
D)LexisNexis Academic
Q4) What are KeySearch and the West Key Number System?
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Page 10
Chapter 9: Multijurisdictional and Other Research
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60 Verified Questions
60 Flashcards
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Sample Questions
Q1) The state entity responsible for enacting laws regarding state revenue sources and consequently passing bills amending and augmenting their state's taxing code is called the:
A)judicial agency
B)administrative body
C)state legislature
D)state tax commission
Q2) In today's expanding tax planning and compliance, tax practitioners need to service their clients by adding to federal tax planning:
A)tax analysis
B)investment planning
C)state and local tax planning
D)estate planning
Q3) Originally, the International Bureau of Fiscal Documentation (IBFD) was simply a document repository, but now it provides expert research products.
A)True
B)False
Q4) What is the International Bureau of Fiscal Documentation, and what is its mission?
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11
Chapter 10: Financial Accounting Research
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42 Verified Questions
42 Flashcards
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Sample Questions
Q1) How is the Codification Research System's "Join Sections" function useful to tax researchers? Give an example of how it works.
Q2) Generally, nonincome taxes are recognized in the financial statements in the period in which they are incurred.
A)True
B)False
Q3) Using the Codification Research System (CRS), a researcher can join all related sections of a topic into a single document so that the guidance across all sections within a topic can be reviewed at one time.
A)True
B)False
Q4) Accounting Statements of Position (SOPs) were brought into the FASB Accounting Standards Codification (ASC).
A)True
B)False
Q5) ASC 740 requires taxpayers to examine each and every "tax position" taken.
A)True
B)False
Q6) Explain the basic principles of accounting for deferred taxes.
Page 12
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Chapter 11: Communicating Research Results
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Sample Questions
Q1) Identify the major elements of a client letter, and briefly discuss the difference between a letter to a sophisticated client and to an unsophisticated client.
Q2) In order to provide the greatest amount of information to the greatest number of listeners, the speaker should direct remarks to the:
A)front of the room
B)back of the room
C)highlights and general results of the research
D)the host or hostess
Q3) To effectively convey the results of a tax research project, the practitioner must:
A)consult IRS officials
B)apply professional judgment and communication skills
C)have an informal discussion with the client
D)all of these are correct
Q4) Well-written case opinions typically provide a summary of the evolution of the pertinent tax law and a discussion of the parties' competing interpretations.
A)True
B)False
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13
Chapter 12: Tax Planning
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Sample Questions
Q1) Often, by moving assets or income out of one government authority into another, tax reductions can be affected. This process is called:
A)changing the timing of recognition of income
B)changing the timing of recognition of deductions
C)deferring the payment of tax
D)changing tax jurisdictions
Q2) Jeffrey Heinz, a salaried person, incurred a loss of $4,000 from passive activities. This loss can be applied as a deduction to offset taxable income from:
A)his salary
B)his long-term capital gains for the year
C)passive activities
D)any source
Q3) Tax planning:
A)is a completely legal means for saving taxes
B)is the same as tax evasion
C)endeavors to understate the taxpayer's real wealth
D)all of these are correct
Q4) What is a statutory tax trap? Give an example.
Q5) Identify the five goals of tax planning behavior and give an example of each.
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Chapter 13: Working With the IRS
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63 Verified Questions
63 Flashcards
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Sample Questions
Q1) In selecting returns for examination, the primary goal of the IRS is to review only those returns that:
A)belong to taxpayers who were found guilty previously
B)will result in a satisfactory increase in the tax liability
C)have been filed for the first time
D)contain mathematical/clerical errors
Q2) A field examination is usually limited to an examination of corporations and individual business returns.
A)True
B)False
Q3) A taxpayer may be represented before the IRS only by attorneys.
A)True
B)False
Q4) Signed into law in 1996, it guarantees taxpayers various rights to representation before the IRS. What is it called?
A)the Constitution
B)the Sixteenth Amendment
C)the Taxpayer Bill of Rights
D)the Taxpayer Advocate
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Chapter 14: Tax Practice and Administration: Sanctions, Agreements,
and Disclosures
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52 Verified Questions
52 Flashcards
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Sample Questions
Q1) The statute of limitations refers to a:
A)set of provisions that limits a tax return preparer's rights
B)specific period of time within which returns must be filed
C)set of provisions that limits a taxpayer's rights
D)specific period of time within which all taxes must be assessed and collected, and all refund claims must be made
Q2) A fraudulent failure-to-file tax return is subject to a 25 percent monthly penalty.
A)True
B)False
Q3) Criminal and civil penalties are mutually exclusive.
A)True
B)False
Q4) Assessable penalties typically are expressed as a flat dollar amount and are usually imposed on third parties, such as tax return preparers.
A)True
B)False
Q5) "In case of both civil and criminal frauds, the burden of proof is on the IRS." Explain.
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