Test Bank
For Federal Tax Research 13th Edition by Roby
Sawyers, Steven Gill Chapters 1 -13 ||Complete A+
Guide
,Chapter 1
1. Tax compliance is the process of:
a. filing necessary tax returns
b. gathering the financial information necessary to report taxable income
c. representing a taxpayer at an IRS audit
d. all of these are correct
ANSWER: d
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 2:12 PM
2. Tax evasion is:
a. a fraudulent act involving illegal nonpayment of taxes
b. one of the objectives of tax planning
c. an act of deferring tax payments to future periods
d. the same as tax avoidance as both of them result in nonpayment of taxes
ANSWER: a
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
3. Tax litigation is a process of:
a. participating in an administrative audit
b. settling tax-related disputes in a court of law
c. filing amended tax returns as prescribed by tax laws
d. arranging a taxpayer’s affairs to minimize tax liabilities
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
4. Regarding open transactions, which of the following statements is INCORRECT?
a. The transaction is not yet completed.
b. The practitioner can suggest changes to achieve a better tax result.
c. A tax practitioner has some degree of control over the client’s tax liability.
d. The practitioner can fix the problem by amending the client’s tax return.
Copyright Cengage Learning. Powered by Cognero. Page 1
,Chapter 1
ANSWER: d
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:15 PM
5. Which of the following statements best describes Circular 230?
a. Circular 230 has been adopted by the AICPA as its set of rules of practice for CPAs.
b. Circular 230 is a set of Treasury Department ethical and legal standards for those engaging in practice before
the IRS.
c. Circular 230 is a set of internal rules at the IRS designed to protect tax practitioners from unfair discipline by
the IRS.
d. Circular 230 is a set of ethical rules for taxpayers.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
6. Who can represent a taxpayer before the IRS Appeals Office under Circular 230?
a. a CPA
b. an officer of a corporation may represent the corporation
c. an attorney
d. all of these are correct
e. both a CPA and an attorney
ANSWER: d
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:19 PM
7. In a closed transaction, the scope of tax planning is:
a. more limited as compared to an open transaction
b. limited by the IRS rules of practice
c. limited to presenting the taxpayer’s facts to the government in the most favorable, legal manner
d. more limited as compared to an open transaction and limited to presenting the taxpayer’s facts to the
government in the most favorable, legal manner
ANSWER: d
Copyright Cengage Learning. Powered by Cognero. Page 2
, Chapter 1
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:21 PM
8. Circular 230 includes rules on all of the following topics EXCEPT:
a. who is authorized to practice before the IRS
b. standards for “covered opinions”
c. compliance with state ethical requirements
d. a set of best practices to guide practitioners
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
9. Statements on Standards for Tax Services (SSTS) contain advisory guidelines for:
a. CPAs
b. enrolled agents
c. attorneys
d. IRS authorities
e. all of these are correct
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:31 PM
10. An EA must renew his or her enrollment card on a:
a. 5-year cycle
b. 3-year cycle
c. 2-year cycle
d. Renewal is not required once an EA gets a card
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
Copyright Cengage Learning. Powered by Cognero. Page 3
For Federal Tax Research 13th Edition by Roby
Sawyers, Steven Gill Chapters 1 -13 ||Complete A+
Guide
,Chapter 1
1. Tax compliance is the process of:
a. filing necessary tax returns
b. gathering the financial information necessary to report taxable income
c. representing a taxpayer at an IRS audit
d. all of these are correct
ANSWER: d
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 2:12 PM
2. Tax evasion is:
a. a fraudulent act involving illegal nonpayment of taxes
b. one of the objectives of tax planning
c. an act of deferring tax payments to future periods
d. the same as tax avoidance as both of them result in nonpayment of taxes
ANSWER: a
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
3. Tax litigation is a process of:
a. participating in an administrative audit
b. settling tax-related disputes in a court of law
c. filing amended tax returns as prescribed by tax laws
d. arranging a taxpayer’s affairs to minimize tax liabilities
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
4. Regarding open transactions, which of the following statements is INCORRECT?
a. The transaction is not yet completed.
b. The practitioner can suggest changes to achieve a better tax result.
c. A tax practitioner has some degree of control over the client’s tax liability.
d. The practitioner can fix the problem by amending the client’s tax return.
Copyright Cengage Learning. Powered by Cognero. Page 1
,Chapter 1
ANSWER: d
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:15 PM
5. Which of the following statements best describes Circular 230?
a. Circular 230 has been adopted by the AICPA as its set of rules of practice for CPAs.
b. Circular 230 is a set of Treasury Department ethical and legal standards for those engaging in practice before
the IRS.
c. Circular 230 is a set of internal rules at the IRS designed to protect tax practitioners from unfair discipline by
the IRS.
d. Circular 230 is a set of ethical rules for taxpayers.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
6. Who can represent a taxpayer before the IRS Appeals Office under Circular 230?
a. a CPA
b. an officer of a corporation may represent the corporation
c. an attorney
d. all of these are correct
e. both a CPA and an attorney
ANSWER: d
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:19 PM
7. In a closed transaction, the scope of tax planning is:
a. more limited as compared to an open transaction
b. limited by the IRS rules of practice
c. limited to presenting the taxpayer’s facts to the government in the most favorable, legal manner
d. more limited as compared to an open transaction and limited to presenting the taxpayer’s facts to the
government in the most favorable, legal manner
ANSWER: d
Copyright Cengage Learning. Powered by Cognero. Page 2
, Chapter 1
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:21 PM
8. Circular 230 includes rules on all of the following topics EXCEPT:
a. who is authorized to practice before the IRS
b. standards for “covered opinions”
c. compliance with state ethical requirements
d. a set of best practices to guide practitioners
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 3/30/2017 11:37 AM
9. Statements on Standards for Tax Services (SSTS) contain advisory guidelines for:
a. CPAs
b. enrolled agents
c. attorneys
d. IRS authorities
e. all of these are correct
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
DATE CREATED: 3/30/2017 11:37 AM
DATE MODIFIED: 4/20/2017 3:31 PM
10. An EA must renew his or her enrollment card on a:
a. 5-year cycle
b. 3-year cycle
c. 2-year cycle
d. Renewal is not required once an EA gets a card
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
Copyright Cengage Learning. Powered by Cognero. Page 3
