Regulatory Compliance Flashcards

Under IRC §6011(e)(3), which preparers must generally e-file individual income tax returns?

Answer: Those who reasonably expect to file 11 or more individual or trust returns in a calendar year

Specified tax return preparers who reasonably expect to file 11 or more covered returns in a calendar year must e-file them unless an exception applies.

Which form lets a taxpayer authorize a third party to receive confidential tax information without giving them the authority to represent the taxpayer?

Answer: Form 8821

Form 8821, Tax Information Authorization, allows disclosure of tax information but does not authorize representation before the IRS.

Which preparer due diligence form must be filed with returns claiming the EITC, CTC/ACTC/ODC, AOTC, or head of household status?

Answer: Form 8867

Form 8867, Paid Preparer's Due Diligence Checklist, documents compliance with the §6695(g) due diligence requirements.

Under IRC §6107, how long must a preparer keep a copy of each return prepared, or a list of the clients and returns?

Answer: 3 years after the close of the return period

Section 6107 requires preparers to keep a copy or a list of returns for 3 years after the close of the return period.

What is the general IRS assessment period if a taxpayer omits more than 25% of the gross income reported on the return?

Answer: 6 years

Under IRC §6501(e), a substantial omission of more than 25% of gross income extends the assessment period to 6 years.

An unenrolled preparer holds an Annual Filing Season Program Record of Completion. What representation rights does that give them?

Answer: Limited representation before revenue agents and customer service for returns they prepared and signed

AFSP participants have limited practice rights: they may represent clients whose returns they prepared and signed, but only before revenue agents, customer service representatives, and similar IRS employees.

Under the §7216 regulations, if a taxpayer's consent to disclose return information does not state an expiration date, how long is it valid?

Answer: One year from the date the taxpayer signs

Treas. Reg. §301.7216-3 provides that a consent without a stated duration is valid for one year from the date signed.