EA - Enrolled Agent COMPREHENSIVE TEST BANK
PRACTICE FINAL EXAM 2026/2027 COMPLETE
ACCURATE EXAM QUESTIONS AND CORRECT
VERIFIED ANSWERS WITH DETAILED RATIONALES
(100% CORRECT VERIFIED ANSWERS) CURRENTLY
UPDATED VERSION 2026 EDITION |GUARANTEED
PASS A+ |FULL REVISED EXAM
For how long should records related to property basis be kept?
A) 3 years after filing the return reporting the property's disposition.
B) 6 years after filing the return reporting the property's disposition.
C) The entire period of ownership plus the applicable limitations
period after disposition.
D) Indefinitely, regardless of disposition.
C) The entire period of ownership plus the applicable limitations
period after disposition.
Basis records must be kept for the entire ownership period plus the
statute of limitations period after disposition to substantiate
gain/loss calculations.
Which of the following expenses requires contemporaneous
documentation under IRC 274(d)?
A) Medical expenses.
B) Charitable contributions under $250.
C) Business travel expenses.
D) Home mortgage interest.
C) Business travel expenses.
IRC Section 274(d) requires contemporaneous documentation for
travel, meals, entertainment, and vehicle expenses, including
amount, time, place, and business purpose.
,A taxpayer who omits income exceeding 25% of the gross income
reported on their return is subject to an extended statute of
limitations of:
A) 3 years.
B) 6 years.
C) 7 years.
D) No limitation.
B) 6 years.
The statute of limitations extends to 6 years when a taxpayer omits
income exceeding 25% of reported gross income.
Which filing status has the lowest filing threshold for tax year 2025?
A) Single.
B) Married Filing Jointly.
C) Married Filing Separately.
D) Head of Household.
C) Married Filing Separately.
Married Filing Separately has the lowest threshold at $5, regardless
of age.
,What is the primary consequence of inadequate recordkeeping
during an IRS examination?
A) Automatic application of the fraud penalty.
B) Criminal prosecution for tax evasion.
C) Disallowance of deductions and credits not properly
substantiated.
D) Mandatory enrollment in electronic filing for 5 years.
C) Disallowance of deductions and credits not properly
substantiated.
Without adequate records, the IRS can disallow claimed deductions
and credits, as the burden of proof is on the taxpayer.
For a child of divorced parents, which parent can claim the Child
and Dependent Care Credit when Form 8332 has been signed?
A) The custodial parent only.
B) The non-custodial parent only.
C) Either parent, depending on who claims the dependency
exemption.
D) Neither parent if the child is over 13.
A) The custodial parent only.
Form 8332 transfers only the dependency exemption and Child Tax
Credit; the Child and Dependent Care Credit remains with the
custodial parent.
, What is the deadline for furnishing Form W-2 to employees?
A) January 15 following the tax year.
B) January 31 following the tax year.
C) February 28 following the tax year.
D) March 31 following the tax year.
B) January 31 following the tax year.
Employers must furnish Forms W-2 to employees by January 31
following the tax year.
Which of the following would qualify as a "temporary absence" that
doesn't disrupt the residency test for a qualifying child?
A) A child attending boarding school for 9 months of the year.
B) A child living with a grandparent for 8 months while the parent
works in another state.
C) A child living with the other parent for 7 months under a custody
agreement.
D) A child studying abroad for an entire academic year.
A) A child attending boarding school for 9 months of the year.
Temporary absences for education are exceptions to the residency
test and don't disrupt the qualifying child status.
PRACTICE FINAL EXAM 2026/2027 COMPLETE
ACCURATE EXAM QUESTIONS AND CORRECT
VERIFIED ANSWERS WITH DETAILED RATIONALES
(100% CORRECT VERIFIED ANSWERS) CURRENTLY
UPDATED VERSION 2026 EDITION |GUARANTEED
PASS A+ |FULL REVISED EXAM
For how long should records related to property basis be kept?
A) 3 years after filing the return reporting the property's disposition.
B) 6 years after filing the return reporting the property's disposition.
C) The entire period of ownership plus the applicable limitations
period after disposition.
D) Indefinitely, regardless of disposition.
C) The entire period of ownership plus the applicable limitations
period after disposition.
Basis records must be kept for the entire ownership period plus the
statute of limitations period after disposition to substantiate
gain/loss calculations.
Which of the following expenses requires contemporaneous
documentation under IRC 274(d)?
A) Medical expenses.
B) Charitable contributions under $250.
C) Business travel expenses.
D) Home mortgage interest.
C) Business travel expenses.
IRC Section 274(d) requires contemporaneous documentation for
travel, meals, entertainment, and vehicle expenses, including
amount, time, place, and business purpose.
,A taxpayer who omits income exceeding 25% of the gross income
reported on their return is subject to an extended statute of
limitations of:
A) 3 years.
B) 6 years.
C) 7 years.
D) No limitation.
B) 6 years.
The statute of limitations extends to 6 years when a taxpayer omits
income exceeding 25% of reported gross income.
Which filing status has the lowest filing threshold for tax year 2025?
A) Single.
B) Married Filing Jointly.
C) Married Filing Separately.
D) Head of Household.
C) Married Filing Separately.
Married Filing Separately has the lowest threshold at $5, regardless
of age.
,What is the primary consequence of inadequate recordkeeping
during an IRS examination?
A) Automatic application of the fraud penalty.
B) Criminal prosecution for tax evasion.
C) Disallowance of deductions and credits not properly
substantiated.
D) Mandatory enrollment in electronic filing for 5 years.
C) Disallowance of deductions and credits not properly
substantiated.
Without adequate records, the IRS can disallow claimed deductions
and credits, as the burden of proof is on the taxpayer.
For a child of divorced parents, which parent can claim the Child
and Dependent Care Credit when Form 8332 has been signed?
A) The custodial parent only.
B) The non-custodial parent only.
C) Either parent, depending on who claims the dependency
exemption.
D) Neither parent if the child is over 13.
A) The custodial parent only.
Form 8332 transfers only the dependency exemption and Child Tax
Credit; the Child and Dependent Care Credit remains with the
custodial parent.
, What is the deadline for furnishing Form W-2 to employees?
A) January 15 following the tax year.
B) January 31 following the tax year.
C) February 28 following the tax year.
D) March 31 following the tax year.
B) January 31 following the tax year.
Employers must furnish Forms W-2 to employees by January 31
following the tax year.
Which of the following would qualify as a "temporary absence" that
doesn't disrupt the residency test for a qualifying child?
A) A child attending boarding school for 9 months of the year.
B) A child living with a grandparent for 8 months while the parent
works in another state.
C) A child living with the other parent for 7 months under a custody
agreement.
D) A child studying abroad for an entire academic year.
A) A child attending boarding school for 9 months of the year.
Temporary absences for education are exceptions to the residency
test and don't disrupt the qualifying child status.
