Tax Ethics and Professional Standards Flashcards
6 cards from real CTA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Tax Ethics and Professional Standards flashcards as text
Which IRS program allows taxpayers to voluntarily disclose previously unreported foreign financial accounts and assets?
Answer: IRS Voluntary Disclosure Program
The IRS Voluntary Disclosure Program allows taxpayers with unreported foreign accounts or income to come forward voluntarily, typically receiving reduced penalties.
The statute of limitations for the IRS to assess additional tax on a return is generally:
Answer: 3 years from the due date or filing date, whichever is later
The IRS generally has three years from the date a return is filed or its due date (whichever is later) to assess additional taxes.
What is the purpose of Form 8275 (Disclosure Statement) in tax practice?
Answer: To disclose positions on a return that may not have adequate authority to avoid accuracy-related penalties
Form 8275 is used to disclose return positions for which there is a reasonable basis but less than substantial authority, to avoid accuracy-related penalties.
A 'reportable transaction' that must be disclosed to the IRS on Form 8886 includes which of the following?
Answer: Listed transactions and other transactions with defined tax avoidance characteristics
Reportable transactions include listed transactions and other categories with significant tax avoidance characteristics that the IRS has identified as warranting disclosure.
Under IRC Section 6662, the civil fraud penalty for tax underpayments attributable to fraud is:
Answer: 75% of the portion attributable to fraud
The civil fraud penalty under IRC Section 6663 is 75% of the portion of the underpayment attributable to fraud.
Confidentiality protections for tax advice given by non-attorney tax practitioners are governed by:
Answer: IRC Section 7525, which provides limited privilege for federally authorized tax practitioners
IRC Section 7525 extends a limited privilege to communications between a client and a federally authorized tax practitioner regarding tax advice, comparable to the attorney-client privilege.