Federal Tax Research, 13th Edition Page 1-1
TEST BANK
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,Page 1-2 SOLUTIONS MANUAL
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INTRODUCTION TO TAX PRACTICE AND ETHICS
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DISCUSSIONjoQUESTIONS
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ngjoanjoInternaljoRevenuejoServicejo(IRS)joaudit.
,Federal Tax Research, 13th Edition Page 1-3
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axjoavoidance.
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, Page 1-4 SOLUTIONS MANUAL
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TEST BANK
jo
jo For Federal Tax Research
jo jo jo
13th Edition by Roby Sawyers, Steven Gill Chapters 1 -13
jo jo jo jo jo jo jo jo jo jo
,Page 1-2 SOLUTIONS MANUAL
CHAPTER 1 jo
INTRODUCTION TO TAX PRACTICE AND ETHICS
jo jo jo jo jo
DISCUSSIONjoQUESTIONS
1-1.
InjothejoUnitedjoStates,jothejotaxjosystemjoisjoanjooutgrowthjoofjothejofollowingjofivejodisciplin
es:jolaw,joaccounting,joeconomics,jopoliticaljoscience,joandjosociology.joThejoenvironmentjoforjothejo
taxjosystemjoisjoprovidedjobyjothejoprinciplesjoofjoeconomics,josociology,joandjopoliticaljoscience,jowh
ilejothejolegaljoandjoaccountingjofieldsjoarejoresponsiblejoforjo thejosystem‘sjointerpretationjo andjoappli
cation.
Eachjoofjothesejodisciplinesjoaffectsjothisjocountry‘sjotaxjosystemjoinjoajouniquejoway.joEconomistsjoad
dressjosuchjoissuesjoasjohowjoproposedjotaxjolegislationjowilljoaffectjothejoratejoofjoinflationjoorjoeconomi
cjogrowth.joMeasurementjoofjothejosocialjoequityjoofjoajotaxjoandjodeterminingjowhetherjoajotaxjosystemjo
discriminatesjoagainstjocertainjotaxpayersjoarejoissuesjothatjoarejoexaminedjobyjosociologistsjoandjopoli
ticaljoscientists.
Finally,joattorneysjoarejoresponsiblejoforjothejointerpretationjoofjothejotaxationjostatutes,joandjoaccounta
ntsjoensurejothatjothesejosamejostatutesjoarejoappliedjoconsistently.****8880()
Pagejo4
1-2. Thejootherjomajorjocategoriesjoofjotaxjopracticejoinjoadditionjotojotaxjoresearchjoarejoasjofollows:
• Taxjocompliance
• Taxjoplanning
• Taxjolitigatio
njoPagejo5
1-3.
Taxjocompliancejoconsistsjoofjogatheringjopertinentjoinformation,joevaluatingjoandjoclassifyi
ngjothatjoinformation,joandjofilingjoanyjonecessaryjotaxjoreturns.joCompliancejoalsojoincludesjootherjof
unctionsjonecessaryjotojosatisfyjogovernmentaljorequirements,josuchjoasjorepresentingjoajoclientjoduri
ngjoanjoInternaljoRevenuejoServicejo(IRS)joaudit.
,Federal Tax Research, 13th Edition Page 1-3
Pagejo5
1-4.
Mostjoofjothejotaxjocompliancejoworkjoisjoperformedjobyjocommercialjotaxjopreparers,joenrolle
djoagentsjo(EAs),joattorneys,joandjocertifiedjopublicjoaccountantsjo(CPAs).joNoncomplexjoindividual,j
opartnership,joandjocorporatejotaxjoreturnsjooftenjoarejocompletedjobyjocommercialjotaxjopreparers.joTh
ejopreparationjoofjomorejocomplexjoreturnsjousuallyjoisjoperformedjobyjoEAs,joattorneys,joandjoCPAs.jo
ThejolatterjogroupsjoalsojoprovidejotaxjoplanningjoservicesjoandjorepresentjotheirjoclientsjobeforejothejoIR
S.
AnjoEAjoisjoonejowhojoisjoadmittedjotojopracticejobeforejothejoIRSjobyjopassingjoajospecialjoIRS-
administeredjoexamination,joorjowhojohasjoworkedjoforjothejoIRSjoforjofivejoyearsjoandjoisjoissuedjoajoper
mitjotojorepresentjoclientsjobeforejothejoIRS.joCPAsjoandjoattorneysjoarejonotjorequiredjotojotakejothisjoexa
minationjoandjoarejoautomaticallyjoadmittedjotojopracticejobeforejothejoIRSjoifjotheyjoarejoinjogoodjostandi
ngjowithjothejoappropriatejoprofessionaljolicensingjoboard.
Pagejo5joandjoCircularjo230
1-5.
Taxjoplanningjoisjothejoprocessjoofjoarrangingjoone‘sjofinancialjoaffairsjotojominimizejoanyjotaxjoli
ability.joMuchjoofjomodernjotaxjopracticejocentersjoaroundjothisjoprocess,joandjothejoresultingjooutcomejoisjot
axjoavoidance.
Therejoisjonothingjoillegaljoorjoimmoraljoinjothejoavoidancejoofjotaxationjoasjolongjoasjothejotaxpayerjoremai
nsjowithinjolegaljobounds.joInjocontrast,jotaxjoevasionjoconstitutesjothejoillegaljononpaymentjoofjoajotaxjoan
djocannotjobejocondoned.joActivitiesjoofjothisjosortjoclearlyjoviolatejoexistingjolegaljoconstraintsjoandjofalljoo
utsidejoofjothejodomainjoofjothejoprofessionaljotaxjopractitioner.
Pagejo6
1-6.
Injoanjoopenjotaxjoplanningjosituation,jothejotransactionjoisjonotjoyetjocomplete;jotherefore,jothejota
xjopractitionerjomaintainsjosomejodegreejoofjocontroljooverjothejopotentialjotaxjoliability,joandjothejotransact
ionjomayjobejomodi-
jo fiedjotojoachievejoajomorejofavorablejotaxjotreatment.joInjoajoclosedjotransactionjohowever,joalljoofjothejope
rtinentjoactionsjohavejobeenjocompleted,joandjotaxjoplanningjoactivitiesjomayjobejolimitedjotojothejopresenta
, Page 1-4 SOLUTIONS MANUAL
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