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Exam 2: Tax Compliance, The IRS and Tax Authorities

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Question 51

True/False

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The statute of limitations for IRS assessment generally ends four years after the date a tax return is filed.

A) True
B) False

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Question 52

Multiple Choice

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If Lindley requests an extension to file her individual tax return,the latest she could pay her tax due without penalty is:

A) April 15ᵗʰ.
B) October 15ᵗʰ.
C) August 15ᵗʰ.
D) November 15ᵗʰ.
E) None of the choices are correct.

F) B) and C)
G) B) and E)

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Question 53

True/False

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A taxpayer can avoid an underpayment penalty if there is substantial authority that supports her tax return position.

Houston has found conflicting authorities that address a research question for one of his clients.The majority of the authorities provide a favorable answer for his client.Nonetheless,there are several authorities that provide an unfavorable answer.Houston estimates that if the client takes the more favorable position on its tax return that there is approximately a 60 percent chance that the position will be sustained upon audit or judicial proceeding.If the client takes this position on its tax return,will Houston be subject to penalty? Will the client potentially be subject to penalty?

In a planning context,

Generally,code sections are arranged (grouped together) :

Andy filed a fraudulent 2017 tax return on May 1,2018.The statute of limitations for IRS assessment on Andy's 2017 tax return should end:

A tax practitioner can avoid IRS penalty relating to a tax return position:

Campbell was researching a tax issue and found a favorable Tax Court opinion and an IRC Code Section that appears to answer the question.Is she finished with the research process? If so,why? If not,what must she do?

Proposed and Temporary Regulations have the same authoritative weight.

The regulation with the lowest authoritative weight is the:

This year April 15ᵗʰ falls on a Saturday.Individual tax returns will be due on:

If a taxpayer has little cash and a very technical tax case that she feels very strongly that the tax rules are "on her side," she should prefer to have her case tried in the U.S.Tax Court.

Which of the following is a false statement? A taxpayer filing a fraudulent tax return:

Which types of penalties are only imposed after normal due process including a trial?

For the following taxpayers,please recommend the most advantageous trial level court(s)to litigate a tax issue with the IRS. a.Joe is litigating a tax issue with the IRS that is considered a question of fact (i.e.,the answers depends on the facts of the case).There is not a lot of authority on point for this case but Joe has a very appealing story to justify his position that is likely to be viewed sympathetically by his peers. b.The Circuit Court of Appeals for the Federal Circuit recently issued an opinion that is very favorable to the issue that Jesse plans to litigate with the IRS. c.The Circuit Court of Appeals for the Federal Circuit recently issued an opinion that is not favorable to the issue that Hank plans to litigate with the IRS. d.The 7ᵗʰ Circuit (where Elizabeth resides)recently issued an opinion that is very favorable to the issue that Elizabeth plans to litigate with the IRS.

If a taxpayer is due a refund,she does not have to file a tax return.

Dan received a letter from the IRS that gave him the choice of (1) requesting a conference with an Appeals Officer or (2) agreeing to a proposed tax adjustment.Dan received the:

Which of the following has the lowest authoritative weight?

For fraudulent tax returns,the statute of limitations for IRS assessment is ten years.