H&R Block Income Tax Course Exam
Questions and Answers 100% Pass
Circular 230 - ✔✔Regulations governing the practice of attorneys, certified public
accountants, enrolled agents, enrolled actuaries, and appraisers before the IRS.
Disclosure - ✔✔The release of tax information by an IRS employee.
Due Diligence - ✔✔Requirements that tax professionals must follow when preparing
income tax returns.
Noncompliance - ✔✔Failure or refusal to comply with the tax code.
Privilege - ✔✔Protection from being required to disclose confidential communications
between two parties, such as attorney and client.
Estimated Tax - ✔✔The amount of tax a taxpayer expects to owe for the year after
subtracting expected amounts withheld and certain refundable credits.
Estimated Tax Voucher - ✔✔A statement by an individual of (1) the amount of income
tax he estimates he will incur during the current taxable year on income that is not
subject to withholding, (2) the excess amount over that withheld on income which is
subject to withholding, and (3) his estimated self-employment tax.
Katelyn Whitman, All Rights Reserved © 2025 1
,Exemption from Withholding - ✔✔Status claimed on Form W-4 directing the employer
not to withhold federal income taxes from the employee.
Underpayment Penalty - ✔✔If a taxpayer did not pay enough tax on a timely basis
during the year, he may be required to pay an underpayment penalty.
Withholding Allowances - ✔✔An increase by which income tax withholding on certain
income is reduced.
Two Ways to Pay as You Go - ✔✔Withholding and Estimated Tax Payments
Form W-4 - ✔✔Employee's Withholding Allowance Certificate
Form 8815 - ✔✔Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued
After 1989
Form 2210 - ✔✔Underpayment of Estimated Tax by Individuals, Estates, and Trusts
Form 4868 - ✔✔Application for Automatic Extension of Time To File U.S. Individual
Income Tax Return
Form 8888 - ✔✔Allocation of Refund
Form 9465 - ✔✔Installment Agreement Request
Amended Return - ✔✔A tax return filed on Form 1040X after the original return has
been filed.
Katelyn Whitman, All Rights Reserved © 2025 2
,Closed Year - ✔✔A tax year for which the statute of limitations has expired.
Open Year - ✔✔A taxable year for which the statute of limitations has not yet expired.
Failure-to-File Penalty - ✔✔Generally 5% for each month or part of a month the return
is late, but not more than 25% of the tax not paid.
Failure to File - ✔✔Taxpayer fails to file the return by the due date, and there is a
balance due.
Failure to Pay - ✔✔Taxpayer fails to pay the tax owed by the due date.
Failure-to-Pay Penalty - ✔✔0.5% of the unpaid taxes for each month or part of a month
after the due date, but not more than 25%.
Negligence or Intentional Disregard - ✔✔Taxpayer shows negligence or disregard of
the rules or regulations causing an underpayment.
Negligence-or-Intentional-Disregard Penalty - ✔✔20% of the underpayment.
Substantial Understatment - ✔✔Taxpayer understates their tax by the larger of $5,000 or
10% of the correct tax.
Substantial-Understatement Penalty - ✔✔20% of the underpayment.
Form 1040X - ✔✔Amended U.S. Individual Income Tax Return
Katelyn Whitman, All Rights Reserved © 2025 3
, When can an amended return be filed? - ✔✔Within three years of the date the original
return was filed, or within two years of the date the tax was paid, whichever is later.
Can the 1040X be e-filed? - ✔✔No.
Household Employee - ✔✔An individual who performs nonbusiness services in a
taxpayer's home.
Active Income and Losses - ✔✔Those for which a taxpayer performs services.
Partnership - ✔✔A form of business in which two or more persons join their money and
skills in conducting the business as co-owners.
Passive Income and Losses - ✔✔Those from business activities in which the taxpayer
does not materially participate, and all rental activities.
Portfolio Income and Losses - ✔✔Those from such sources as dividends, interest, capital
gains and losses, and royalties.
Rental Income - ✔✔Income received by the taxpayer for allowing another person's use
of the taxpayer's property.
Royalty - ✔✔(1) A payment received for the right to exploit a taxpayer's ownership of
natural resources or a taxpayer's literary, musical, or artistic creation. (2) An interest in
the oil and gas in place that entitles the holder to a specified fraction, in kind or in
Katelyn Whitman, All Rights Reserved © 2025 4
Questions and Answers 100% Pass
Circular 230 - ✔✔Regulations governing the practice of attorneys, certified public
accountants, enrolled agents, enrolled actuaries, and appraisers before the IRS.
Disclosure - ✔✔The release of tax information by an IRS employee.
Due Diligence - ✔✔Requirements that tax professionals must follow when preparing
income tax returns.
Noncompliance - ✔✔Failure or refusal to comply with the tax code.
Privilege - ✔✔Protection from being required to disclose confidential communications
between two parties, such as attorney and client.
Estimated Tax - ✔✔The amount of tax a taxpayer expects to owe for the year after
subtracting expected amounts withheld and certain refundable credits.
Estimated Tax Voucher - ✔✔A statement by an individual of (1) the amount of income
tax he estimates he will incur during the current taxable year on income that is not
subject to withholding, (2) the excess amount over that withheld on income which is
subject to withholding, and (3) his estimated self-employment tax.
Katelyn Whitman, All Rights Reserved © 2025 1
,Exemption from Withholding - ✔✔Status claimed on Form W-4 directing the employer
not to withhold federal income taxes from the employee.
Underpayment Penalty - ✔✔If a taxpayer did not pay enough tax on a timely basis
during the year, he may be required to pay an underpayment penalty.
Withholding Allowances - ✔✔An increase by which income tax withholding on certain
income is reduced.
Two Ways to Pay as You Go - ✔✔Withholding and Estimated Tax Payments
Form W-4 - ✔✔Employee's Withholding Allowance Certificate
Form 8815 - ✔✔Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued
After 1989
Form 2210 - ✔✔Underpayment of Estimated Tax by Individuals, Estates, and Trusts
Form 4868 - ✔✔Application for Automatic Extension of Time To File U.S. Individual
Income Tax Return
Form 8888 - ✔✔Allocation of Refund
Form 9465 - ✔✔Installment Agreement Request
Amended Return - ✔✔A tax return filed on Form 1040X after the original return has
been filed.
Katelyn Whitman, All Rights Reserved © 2025 2
,Closed Year - ✔✔A tax year for which the statute of limitations has expired.
Open Year - ✔✔A taxable year for which the statute of limitations has not yet expired.
Failure-to-File Penalty - ✔✔Generally 5% for each month or part of a month the return
is late, but not more than 25% of the tax not paid.
Failure to File - ✔✔Taxpayer fails to file the return by the due date, and there is a
balance due.
Failure to Pay - ✔✔Taxpayer fails to pay the tax owed by the due date.
Failure-to-Pay Penalty - ✔✔0.5% of the unpaid taxes for each month or part of a month
after the due date, but not more than 25%.
Negligence or Intentional Disregard - ✔✔Taxpayer shows negligence or disregard of
the rules or regulations causing an underpayment.
Negligence-or-Intentional-Disregard Penalty - ✔✔20% of the underpayment.
Substantial Understatment - ✔✔Taxpayer understates their tax by the larger of $5,000 or
10% of the correct tax.
Substantial-Understatement Penalty - ✔✔20% of the underpayment.
Form 1040X - ✔✔Amended U.S. Individual Income Tax Return
Katelyn Whitman, All Rights Reserved © 2025 3
, When can an amended return be filed? - ✔✔Within three years of the date the original
return was filed, or within two years of the date the tax was paid, whichever is later.
Can the 1040X be e-filed? - ✔✔No.
Household Employee - ✔✔An individual who performs nonbusiness services in a
taxpayer's home.
Active Income and Losses - ✔✔Those for which a taxpayer performs services.
Partnership - ✔✔A form of business in which two or more persons join their money and
skills in conducting the business as co-owners.
Passive Income and Losses - ✔✔Those from business activities in which the taxpayer
does not materially participate, and all rental activities.
Portfolio Income and Losses - ✔✔Those from such sources as dividends, interest, capital
gains and losses, and royalties.
Rental Income - ✔✔Income received by the taxpayer for allowing another person's use
of the taxpayer's property.
Royalty - ✔✔(1) A payment received for the right to exploit a taxpayer's ownership of
natural resources or a taxpayer's literary, musical, or artistic creation. (2) An interest in
the oil and gas in place that entitles the holder to a specified fraction, in kind or in
Katelyn Whitman, All Rights Reserved © 2025 4
