Deck 3: Constitutional and Legislative Sources

Question 1

Which of the following is an administrative source of the federal tax law issued by the IRS?

A)court rulings
B)Internal Revenue Code
C)tax treaties
D)revenue rulings
E)none of these are correct

Answer 1

D

Question 2

Which of the following is CORRECT regarding the Floor Debate Report?

A)It is contained in the Congressional Record.
B)Technical or detailed information excluded from the committee report(s)may be included.
C)It summarizes the discussions made in the House or the Senate concerning a proposed tax bill.
D)All of these are correct.

Answer 2

D

Question 3

P.L. 107-16 is the citation for:

A)the Conference report on the 16^th public law enacted in the 107^th Congress
B)the 16^th public law enacted in the 107^th Congress
C)a public law enacted by Congress but not signed by the President
D)none of these are correct

Answer 3

B

Question 4

The overriding purpose of tax treaties is to:

A)create "tax havens"
B)minimize tax liability of multinational corporations
C)require business taxpayers tofile returns in all countries in which they operate
D)eliminate the "double taxation" that a taxpayer would face if his or her income were subject totax in both countries

Question 5

Subtitle A of the Internal Revenue Code deals with:

A)estate and gift taxes
B)employment taxes
C)income taxes
D)excise taxes

Question 6

The first federal income tax law was passed as a result of the:

A)Civil War
B)Mexican-American War
C)Spanish-American War
D)none of these are correct

Question 7

Regarding the taxing powers of the federal government, the U.S. Constitution requires that:

A)taxes imposed by Congress must apply uniformly throughout the United States
B)nodirect taxes may be imposed on income
C)all revenues from the federal income tax must be apportioned tothe population of the states from which they were collected
D)all of these are correct

Question 8

Which of the following statements is CORRECT regarding the enactment intolaw of a tax bill?

A)A tax bill must always be signed by the President tobecome law.
B)A tax law must be approved by the Treasury Department.
C)A tax law must either be signed intolaw by the President or Congress must override a presidential vetoof the proposed law.
D)None of these are correct.

Question 9

Which of the following sections of the Internal Revenue Code deal with partnerships?

A)the 700s
B)the 300s
C)Section 162
D)Section 501

Question 10

Which of the following statements is CORRECT regarding Committee Reports?

A)They are published in the Internal Revenue Bulletin.
B)They can be found in most subscription online tax services.
C)They explain the elements of proposed tax law changes and reasons for the changes.
D)All of these are correct.
E)None of these are correct.

Question 11

A "tax protester" is:

A)a person whofiles a "frivolous" return with the IRS
B)a person whobrings a "frivolous" matter before the Tax Court
C)a person who may be subject toa penalty for frivolous Tax Court petitions
D)all of these are correct
E)none of these are correct

Question 12

A subtitle of the Internal Revenue Code:

A)is indicated by a capital letter, such as "Subtitle A"
B)relates toa well-defined area of the law
C)is used as a short-hand reference todescribe types of corporations
D)is indicated by a capital letter, such as "Subtitle A," and relates toa well-defined area of the law
E)all of the above

Question 13

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.

Question 14

The current Internal Revenue Code is the:

A)Internal Revenue Code of 2011
B)Internal Revenue Code of 1986
C)Internal Revenue Code of 1954
D)none of these are correct

Question 15

The first Internal Revenue Code was:

A)the Internal Revenue Code of 1939
B)the Internal Revenue Code of 1954
C)the Revenue Act of 1913
D)none of these are correct

Question 16

In the House of Representatives, tax law changes are primarily considered by:

A)the Finance Committee
B)a Conference Committee
C)the Budget Committee
D)the Ways and Means Committee

Question 17

If any differences exist between the House- and Senate-passed versions of a tax bill, the bill is referred to:

A)the Finance Committee
B)the President
C)a Conference Committee
D)the Supreme Court

Question 18

Each Congress lasts for:

A)2 years
B)1 year
C)3 years
D)4 years

Question 19

Which of the following issues is NOT addressed by tax treaties?

A)what tax disclosures must be made by a visitor toa host country
B)treatment of business and investment income earned by a foreign visitor in the United States
C)treatment of business and investment income earned by a foreign citizen in his home country
D)how tocompute the taxable amount in the host country
E)all of these are correct

Question 20

Which of the following statements is INCORRECT regarding the structure of the Internal Revenue Code?

A)Code section numbers start over in each chapter.
B)Each Code section is used only once in the Internal Revenue Code.
C)Code sections inserted between existing section numbers are indicated by adding a capital letter tothe Section number (e.g., Section 25A)
D)The Internal Revenue Code is Title 26 of the United States Code.

Question 21

The United States - Mexico- Canada Agreement (USMCA)is a non-tax international treaty that addresses some tax-related issues.

Question 22

Most tax legislation begins in the House of Representatives.

Question 23

The 16^th Amendment tothe U.S. Constitution authorized the imposition of a Federal income tax.

Question 24

Which of the following statements is CORRECT regarding the definition of terms in the Internal Revenue Code?

A)All definitions are included in Section 7701.
B)Definitions are always included within the Code section towhich they apply.
C)Definitions are written intothe Code by the IRS rather than included in tax laws passed by Congress.
D)Sometimes, a researcher may need toconsult the regulations tofind a complete definition of a term.

Question 25

Code Section 61 relates to:

A)deductions for adjusted gross income
B)the definition of gross income
C)corporate tax rates
D)the deduction for state taxes

Question 26

In Pollock v. Farmers' Loan and Trust Co., the Supreme Court held that the income tax was unconstitutional because it was a constitutionally prohibited "direct tax."

Question 27

Congress cannot override a Presidential vetoof a tax bill.

Question 28

A "technical corrections act" is:

A)a set of changes made by IRS tofit new tax law provisions intothe Code
B)an act passed by Congress toremove errors in implementing and interpreting the new provisions of a tax law
C)the act that provides the effective dates for a new tax law
D)none of these are correct

Question 29

Tax treaties are agreements negotiated between countries concerning the treatment of entities subject totax in both countries.

Question 30

Section 121(B) (2) (a) (b) (iii)would be a correct type of Code citation.

Question 31

The Joint Conference Committee is called on toresolve differences between the House Ways and Means Committee version and the full House version of tax legislation.

Question 32

Which of the following statements is INCORRECT regarding the reasons tax researchers may have difficulty in interpreting the Internal Revenue Code?

A)Code sections can appear toconflict.
B)Definitions can be significantly different from the common use of a term.
C)All exceptions toa Code section are addressed within that same section.
D)Frequently, phrases modify percentage or dollar amounts.

Question 33

Taxpayers whofile frivolous returns are subject toa $25,000 fine.

Question 34

Treaties may expire because of a specific Congressional time limitation.

Question 35

Which of the following statements is INCORRECT regarding effective dates in the Internal Revenue Code?

A)All sections of a new tax law gointoeffect at the same time.
B)New Code provisions may not gointoeffect immediately upon adoption by Congress.
C)Some effective dates can precede passage of the act.
D)All of these are correct.

Question 36

Circuit Courts are administrative sources of the federal tax law.

Question 37

When a Code provision and a provision under a treaty conflict, the one adopted earlier in time generally rules.

Question 38

Historically, the 1913 income tax was a tax on wealthy and high-income taxpayers.

Question 39

Subparagraphs are the major divisions of the Internal Revenue Code covering such broad topics as Income Taxes, and Estate and Gift Taxes.

Question 40

Statutory sources of federal tax law come out of the legislative branch of the U.S. government.

Question 41

Whenever a major new tax law is passed, CCH and RIA both publish the related Committee Reports.

Question 42

Trade or business deductions are contained in Code Section 62.

Question 43

What information is included in the history of a Code section?

Question 44

The term "not less than 50" represents only those numbers which are more than 50.

Question 45

A report of Floor Debate is included in the Congressional Record and may include some detailed or technical information that is excluded from a Committee Report.

Question 46

The "General Explanation" of tax legislation, called the "Blue Book," is prepared by the Joint Conference Committee.

Question 47

What is a tax protester and what types of sanctions are tax protesters subject to?

Question 48

List several issues that tax treaties commonly address.

Question 49

Describe the steps in the legislative process by which a tax bill becomes law.