Enrolled Agent (EA) Special Enrollment
Examination – Part 3 (AGACNP-C)
2026–2027 | Comprehensive Question
Practice Test with Answers & Rationales|
Free Pdf Access
1. Circular 230 governs:
A. Practice before the Internal Revenue Service (IRS)
B. State income tax laws only
C. Financial accounting standards
D. Securities regulations
Correct Answer: A
Rationale: Circular 230 establishes the rules governing attorneys, CPAs, enrolled agents,
and other practitioners who represent taxpayers before the IRS.
2. An Enrolled Agent is authorized to:
A. Represent taxpayers before the IRS in all tax matters
B. Represent taxpayers only in state tax courts
C. Audit publicly traded companies
D. Practice law in federal court without admission
,Correct Answer: A
Rationale: Enrolled Agents have unlimited practice rights before the IRS.
3. Under Circular 230, practitioners must exercise:
A. Due diligence
B. Guaranteed tax savings
C. Personal judgment without documentation
D. Blind reliance on client statements
Correct Answer: A
Rationale: Practitioners must exercise due diligence in preparing returns and making
representations to the IRS.
4. A practitioner who discovers an error on a previously filed return should:
A. Promptly advise the client of the error and its consequences
B. Ignore the error
C. Notify the IRS without informing the client
D. Destroy the related records
Correct Answer: A
Rationale: Circular 230 requires practitioners to inform clients of errors and the potential
consequences.
5. Which action violates Circular 230?
A. Knowingly submitting false information to the IRS
B. Maintaining client confidentiality
,C. Exercising due diligence
D. Keeping accurate records
Correct Answer: A
Rationale: Providing false or misleading information to the IRS is prohibited.
6. A valid Power of Attorney is generally granted using:
A. IRS Form 2848
B. IRS Form W-2
C. IRS Form 1040
D. IRS Form 1099
Correct Answer: A
Rationale: Form 2848 authorizes an individual to represent a taxpayer before the IRS.
7. An Enrolled Agent may represent:
A. Individuals, businesses, estates, and trusts
B. Individuals only
C. Corporations only
D. Partnerships only
Correct Answer: A
Rationale: Enrolled Agents have unlimited representation rights before the IRS.
8. Which taxpayer right includes the ability to challenge the IRS's position?
A. Right to Challenge the IRS's Position and Be Heard
, B. Right to Free Tax Preparation
C. Right to Reduced Taxes
D. Right to Guaranteed Refunds
Correct Answer: A
Rationale: Taxpayers have the right to present objections and provide supporting
documentation.
9. The IRS Independent Office of Appeals primarily exists to:
A. Resolve tax disputes without litigation
B. Prepare tax returns
C. Conduct criminal investigations
D. Issue tax refunds
Correct Answer: A
Rationale: Appeals provides an independent review of unresolved tax controversies.
10. Which IRS publication explains taxpayer rights?
A. Publication 1
B. Publication 17
C. Publication 334
D. Publication 463
Correct Answer: A
Rationale: Publication 1 outlines the Taxpayer Bill of Rights.
Examination – Part 3 (AGACNP-C)
2026–2027 | Comprehensive Question
Practice Test with Answers & Rationales|
Free Pdf Access
1. Circular 230 governs:
A. Practice before the Internal Revenue Service (IRS)
B. State income tax laws only
C. Financial accounting standards
D. Securities regulations
Correct Answer: A
Rationale: Circular 230 establishes the rules governing attorneys, CPAs, enrolled agents,
and other practitioners who represent taxpayers before the IRS.
2. An Enrolled Agent is authorized to:
A. Represent taxpayers before the IRS in all tax matters
B. Represent taxpayers only in state tax courts
C. Audit publicly traded companies
D. Practice law in federal court without admission
,Correct Answer: A
Rationale: Enrolled Agents have unlimited practice rights before the IRS.
3. Under Circular 230, practitioners must exercise:
A. Due diligence
B. Guaranteed tax savings
C. Personal judgment without documentation
D. Blind reliance on client statements
Correct Answer: A
Rationale: Practitioners must exercise due diligence in preparing returns and making
representations to the IRS.
4. A practitioner who discovers an error on a previously filed return should:
A. Promptly advise the client of the error and its consequences
B. Ignore the error
C. Notify the IRS without informing the client
D. Destroy the related records
Correct Answer: A
Rationale: Circular 230 requires practitioners to inform clients of errors and the potential
consequences.
5. Which action violates Circular 230?
A. Knowingly submitting false information to the IRS
B. Maintaining client confidentiality
,C. Exercising due diligence
D. Keeping accurate records
Correct Answer: A
Rationale: Providing false or misleading information to the IRS is prohibited.
6. A valid Power of Attorney is generally granted using:
A. IRS Form 2848
B. IRS Form W-2
C. IRS Form 1040
D. IRS Form 1099
Correct Answer: A
Rationale: Form 2848 authorizes an individual to represent a taxpayer before the IRS.
7. An Enrolled Agent may represent:
A. Individuals, businesses, estates, and trusts
B. Individuals only
C. Corporations only
D. Partnerships only
Correct Answer: A
Rationale: Enrolled Agents have unlimited representation rights before the IRS.
8. Which taxpayer right includes the ability to challenge the IRS's position?
A. Right to Challenge the IRS's Position and Be Heard
, B. Right to Free Tax Preparation
C. Right to Reduced Taxes
D. Right to Guaranteed Refunds
Correct Answer: A
Rationale: Taxpayers have the right to present objections and provide supporting
documentation.
9. The IRS Independent Office of Appeals primarily exists to:
A. Resolve tax disputes without litigation
B. Prepare tax returns
C. Conduct criminal investigations
D. Issue tax refunds
Correct Answer: A
Rationale: Appeals provides an independent review of unresolved tax controversies.
10. Which IRS publication explains taxpayer rights?
A. Publication 1
B. Publication 17
C. Publication 334
D. Publication 463
Correct Answer: A
Rationale: Publication 1 outlines the Taxpayer Bill of Rights.
