Deck 2: Working With the Tax Law

Question 1

A taxpayer must pay any tax deficiency assessed by the IRS and sue for a refund to bring suit in the U.S.District Court.

Answer 1

True

Question 2

A large part of tax research involves determining the intent of Congress.

Answer 2

True

Question 3

Regulations are issued by the Treasury Department.

Answer 3

True

Question 4

Proposed Regulations have the force and effect of law.

Question 5

Temporary Regulations have the same authoritative value as Finalized Regulations.

Question 6

Neither the 1939 nor the 1954 Code substantially changed the tax law existing on the date of its enactment.

Question 7

Revenue Procedures deal with the internal management practices and procedures of the IRS.

Question 8

Letter rulings may not be substantial authority for purposes of the accuracy-related penalty in § 6662.

Question 9

A Revenue Procedure is an administrative source of Federal tax law.

Question 10

General Counsel Memoranda may be cited as precedents by taxpayers.

Question 11

Revenue Rulings carry the same legal force and effect as Regulations.

Question 12

Technical Advice Memoranda deal with completed transactions.

Question 13

Determination letters usually involve proposed transactions.

Question 14

Federal tax legislation generally originates in the Senate Finance Committee.

Question 15

Subchapter K refers to the "Partners and Partnerships" section of the Code.

Question 16

Individual Senators have considerable latitude to make amendments on the Senate floor.

Question 17

Proposed Regulations are not published in the Federal Register.

Question 18

Treasury Decisions are issued by the Treasury Department to promulgate new Regulations.

Question 19

Unlike determination letters,letter rulings are issued by the National Office of the IRS.

Question 20

Some Regulations are arranged in different sequence than the Code.

Question 21

IRS agents must give the Code and Regulations issued thereunder equal weight when dealing with taxpayers and their representatives.

Question 22

A taxpayer must pay any tax deficiency assessed by the IRS and sue for a refund to bring suit in the U.S.Court of Federal Claims.

Question 23

Proposed Regulations are binding on the IRS and taxpayers.

Question 24

Often a court will invalidate a Regulation or portion thereof on the grounds that the Regulation is contrary to the intent of Congress.

Question 25

In a U.S.District Court,a jury can decide both questions of fact and questions of law.

Question 26

A taxpayer can obtain a jury trial in a U.S.Court of Federal Claims.

Question 27

An easy way to locate a journal article pertinent to a tax problem is through Commerce Clearing House's Federal Tax Articles.

Question 28

The Golsen rule has been overturned by the U.S.Supreme Court.

Question 29

Arizona is in the jurisdiction of the First Circuit Court of Appeals.

Question 30

Three judges will normally hear each U.S.Tax Court case.

Question 31

Before 1943,the U.S.Tax Court was called the Board of Tax Appeals.

Question 32

The granting of a Writ of Certiorari indicates that at least five members of the Supreme Court believe that an issue is of sufficient importance to be heard by the full court.

Question 33

Among the approaches available for online tax research are a keyword approach,a table of contents approach,an index approach,and a citation approach.

Question 34

The term "respondent" is a synonym for defendant.

Question 35

The "defendant" refers to the party against whom a suit is brought.

Question 36

Accessing tax documents through electronic means offers limited advantages over a strictly paper-based approach.

Question 37

The major tax services are not available in electronic format.

Question 38

The Internet provides a wealth of tax information in several popular forms,sometimes at no direct cost to the researcher.

Question 39

Texas is in the jurisdiction of the Second Circuit Court of Appeals.

Question 40

When dealing with proposed transactions,the tax research process is directed toward the determination of possible alternative consequences.

Question 41

Subchapter S covers which specific area of tax law?

A)Simplification.
B)Deductions.
C)Capital gains and losses.
D)Tax rates.
E)None of the above.

Question 42

Which of the following is not an administrative source of the tax law?

A)General Counsel Memoranda.
B)Revenue Procedures.
C)Technical Advice Memoranda.
D)Actions on Decisions.
E)All of the above are administrative sources.

Question 43

Which committee reconciles the tax bills between the Senate and the House?

A)Joint Committee on Taxation.
B)Joint Conference Committee.
C)Joint Reconciliation Committee.
D)Joint Resolving Committee.
E)None of the above.

Question 44

Interpretive Regulations have the force and effect of law.

Question 45

A U.S.District Court decision carries less weight than a decision issued by the Fifth Circuit Court of Appeals.

Question 46

What administrative release deals with a proposed transaction rather than a completed transaction?

A)Letter Ruling.
B)Technical Advice Memorandum.
C)Determination Letter.
D)Field Service Advice.
E)None of the above.

Question 47

Which statement is false with respect to tax treaties?

A)There is a $1,000 penalty per failure to disclose on the tax return where there is a direct treaty conflict for an individual.
B)There is a $10,000 penalty per failure to disclose on the tax return where there is a direct treaty conflict for a corporation.
C)Treaties override the Code when in conflict.
D)Treaties may override a Code section when in conflict.
E)None of the above.

Question 48

Which item may not be cited as a precedent?

A)Regulations.
B)Temporary Regulations.
C)Technical Advice Memoranda.
D)U.S.District Court decision.
E)None of the above.

Question 49

What statement is not true with respect to Temporary Regulations?

A)May not be cited as precedent.
B)Issued as Proposed Regulations.
C)Automatically expire within three years after the date of issuance.
D)Found in the Federal Register.
E)All of the above statements are true.

Question 50

Which of the following sources has the highest tax validity?

A)Revenue Ruling.
B)Letter ruling.
C)Regulations.
D)Internal Revenue Code section.
E)None of the above.

Question 51

The Internal Revenue Code was codified in which of the following years?

A)1913.
B)1933.
C)1954.
D)1957.
E)None of the above.

Question 52

Identify the number of the Court(s)of Federal Claims?

A)1.
B)3.
C)16.
D)19.
E)None of the above is correct.

Question 53

In assessing the importance of a regulation,an IRS agent must:

A)Give equal weight to the Code and regulations.
B)Give more weight to the Code rather than to a regulation.
C)Give more weight to the regulation rather than to the Code.
D)Give less weight to the Code rather than to a regulation.
E)None of the above.

Question 54

Which of the following types of Regulations has the highest tax validity?

A)Temporary.
B)Legislative.
C)Interpretative.
D)Procedural.
E)None of the above.

Question 55

What statement is not true with respect to a regulation which interprets the tax law?

A)Issued by the U.S.Congress.
B)Issued by the U.S.Treasury Department.
C)Designed to provide an interpretation of the tax law.
D)Carries more legal force than a Revenue Ruling.
E)All of the above statements are true.

Question 56

The computer-based CPA examination has four sections with true-false,multiple-choice,and case studies (called simulations).

Question 57

Which of the following indicates that a decision has precedential value for future cases?

A)Stare decisis.
B)Golsen doctrine.
C)En banc.
D)Reenactment doctrine.
E)None of the above.

Question 58

Tax bills are handled by which committee in the U.S.Senate?

A)Taxation Committee.
B)Ways and Means Committee.
C)Finance Committee.
D)Budget Committee.
E)None of the above.

Question 59

A taxpayer who loses in a U.S.District Court may appeal directly to the:

A)Supreme Court.
B)U.S.Tax Court.
C)U.S.Court of Federal Claims.
D)U.S.Circuit Court of Appeals.
E)All of the above.

Question 60

Which is not a Code section number?

A)§ 212(1).
B)§ 2(a)(1).
C)§ 280B.
D)§ 6(a).
E)All are current Code sections.

Question 61

Compare a determination letter with a letter ruling.

Question 62

The Golsen doctrine applies to which court?

A)U.S.District Court.
B)U.S.Court of Federal Claims.
C)U.S.Tax Court.
D)U.S.Supreme Court.
E)Some other court.

Question 63

Why are some Code section numbers intentionally omitted from the Internal Revenue Code?

Question 64

A Memorandum decision of the U.S.Tax Court could be cited as:

A)T.C.Memo.1990-650.
B)68-1 USTC ¶9200.
C)37 AFTR2d 456.
D)All of the above.
E)None of the above.

Question 65

Which trial court decision is generally more authoritative?

A)U.S.District Court.
B)U.S.Tax Court.
C)U.S.Court of Federal Claims.
D)Small Cases Division of the Tax Court.
E)All of the above are the same.

Question 66

Discuss the advantages and disadvantages of the Small Cases Division of the U.S.Tax Court.

Question 67

Which statement is incorrect with respect to a tax treaty?

A)A tax treaty always overrides a Code section when they conflict.
B)The purpose of a treaty is to render mutual assistance in tax enforcement and to avoid double taxation.
C)Taxpayers must disclose on their tax returns any position where a treaty overrides a Code section.
D)There is a $1,000 penalty per failure to disclose a conflicting tax treaty.
E)All are correct.

Question 68

Which state is located in the jurisdiction of the Fifth Circuit Court of Appeals?

A)Louisiana.
B)California.
C)New York.
D)South Carolina.
E)None of the above.

Question 69

Which trial court has 16 judges?

A)U.S.Tax Court.
B)U.S.Court of Federal Claims.
C)U.S.Supreme Court.
D)U.S.Court of Appeals.
E)None of the above.

Question 70

How can congressional committee reports be used by a tax researcher?

Question 71

Explain the difference between tax avoidance and tax evasion.

Question 72

Which trial court hears only tax disputes?

A)U.S.District Court.
B)U.S.Tax Court.
C)U.S.Court of Federal Claims.
D)U.S.Circuit Courts of Appeals.
E)None of the above.

Question 73

Explain the Golsen doctrine.

Question 74

Which trial court's jurisdiction depends on the geographical location of the taxpayer?

A)U.S.Tax Court.
B)U.S.District Court.
C)U.S.Court of Federal Claims.
D)Small Cases Division of the Tax Court.
E)None of the above.

Question 75

Which court decision is generally more authoritative?

A)A U.S.Tax Court decision.
B)Court of Federal Claims decision.
C)District Court decision.
D)U.S.Court of Appeals decision.
E)U.S.Tax Court Memorandum decision.

Question 76

Which of the following statements about an acquiescence is correct?

A)An acquiescence is issued in the Federal Registrar.
B)Acquiescences are published only for certain regular decisions of the U.S.Tax Court.
C)An acquiescence is published in the Internal Revenue Bulletin.
D)The IRS does not issue acquiescences to adverse decisions that are not appealed.
E)All of the above are correct.

Question 77

Which statement is incorrect with respect to taxation on the CPA exam?

A)The CPA exam now has only four parts.
B)There are no longer case studies on the exam.
C)A candidate may not go back after exiting a testlet.
D)Simulations include a four-function pop-up calculator.
E)None of the above are incorrect.

Question 78

Explain the function of Temporary Regulations.