Question 1

For purposes of tax penalties, a VITA volunteer is not classified as a tax return ____________________.

Accepted Answer

The answer of For purposes of tax penalties, a VITA...

Question 2

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Failure to file a tax return.

Accepted Answer

Failure to file a tax return is considered a taxpayer penalty because it is the taxpayer's responsibility to file their tax returns on time.

Question 3

A privilege of exists between certain types of tax preparers and the client as to tax advice rendered.

Accepted Answer

The answer of A privilege of exists between certain types...

Question 4

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Failure to sign the return.

Accepted Answer

The answer of Match each of the following tax penalties...

Question 5

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used.
-Negligence in filing a return.

Accepted Answer

The answer of For each of the indicated tax penalties,...

Question 6

A(n) $ penalty applies if the tax preparer does not sign the client's tax return.

Accepted Answer

The answer of A(n) $ penalty applies if the tax...

Question 7

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Failure to pay a tax.

Accepted Answer

Failure to pay a tax is considered a taxpayer penalty, as it directly involves the taxpayer's obligation to pay taxes due.

Question 8

The tax workpapers prepared as part of an independent financial audit are not privileged communications that can be kept confidential from an IRS subpoena.

Accepted Answer

The answer of The tax workpapers prepared as part of...

Question 9

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used.
-Undervaluation of a reported item.

Accepted Answer

Reasonable cause is a defense to an undervaluation penalty.

Question 10

The tax preparer penalty for taking an unreasonable tax return position is the greater of $
or of the tax professional's income from preparing the return.

Accepted Answer

The answer of The tax preparer penalty for taking an...

Question 11

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Negligence.

Accepted Answer

Negligence penalties are typically imposed on taxpayers who fail to make a reasonable attempt to comply with tax laws.

Question 12

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Improper refund claim.

Accepted Answer

Improper refund claims are typically associated with taxpayer penalties, as they involve the taxpayer making a false or incorrect claim for a refund.

Question 13

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Willful and reckless conduct.

Accepted Answer

Willful and reckless conduct typically refers to a tax preparer penalty, as it involves actions taken by tax preparers that intentionally or recklessly disregard tax laws or regulations.

Question 14

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used.
-Substantial understatement of tax liability.

Accepted Answer

Substantial authority is a defense against the penalty for substantial understatement of tax liability, as it indicates that the taxpayer had a reasonable basis for the tax position taken.

Question 15

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Fraudulent failure to file a tax return.

Accepted Answer

Fraudulent failure to file a tax return is considered a taxpayer penalty because it directly involves the taxpayer's obligation to file their tax returns accurately and on time. This penalty is imposed on taxpayers who intentionally fail to file their returns as a way to evade taxes.

Question 16

A(n) member must follow the Statements of Standards for Tax Services in conducting a tax practice.

Accepted Answer

The answer of A(n) member must follow the Statements of...

Question 17

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Misstatement of withholding allowances.

Accepted Answer

Misstatement of withholding allowances typically results in a penalty for the taxpayer, as it directly affects the amount of tax withheld from their income.

Question 18

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Aiding in preparing an improper tax return.

Accepted Answer

Aiding in preparing an improper tax return is considered a tax preparer penalty. This penalty is imposed on tax preparers who engage in activities such as willfully understating a client's tax liability.

Question 19

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter.
-Substantial understatement of a tax.

Accepted Answer

Substantial understatement of a tax penalty is considered a taxpayer penalty, as it is imposed on taxpayers who understate their tax liability by a significant amount. This penalty encourages accurate tax reporting and compliance.

Question 20

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used.
-Failure to pay a tax that is due.

Accepted Answer

Reasonable cause is the appropriate taxpayer defense for failure to pay a tax that is due. This defense is used when the taxpayer can demonstrate that they exercised ordinary business care and prudence but were nevertheless unable to pay the tax.

Quiz 26: Tax Practice and Ethics

For purposes of tax penalties, a VITA volunteer is not classified as a tax return ____________________.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Failure to file a tax return.

A privilege of exists between certain types of tax preparers and the client as to tax advice rendered.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Failure to sign the return.

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used. -Negligence in filing a return.

A(n) $ penalty applies if the tax preparer does not sign the client's tax return.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Failure to pay a tax.

The tax workpapers prepared as part of an independent financial audit are not privileged communications that can be kept confidential from an IRS subpoena.

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used. -Undervaluation of a reported item.

The tax preparer penalty for taking an unreasonable tax return position is the greater of $ or of the tax professional's income from preparing the return.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Negligence.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Improper refund claim.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Willful and reckless conduct.

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used. -Substantial understatement of tax liability.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Fraudulent failure to file a tax return.

A(n) member must follow the Statements of Standards for Tax Services in conducting a tax practice.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Misstatement of withholding allowances.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Aiding in preparing an improper tax return.

Match each of the following tax penalties with the type of tax penalty as specified by the Code. A letter can be used more than once. The correct solution may include more than one letter. -Substantial understatement of a tax.

For each of the indicated tax penalties, indicate the appropriate taxpayer defense. A letter may be used more than once. Not all of the letters need be used. -Failure to pay a tax that is due.