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Exam 2: Tax Compliance, the Irs, and Tax Authorities

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Question 41

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Campbell was researching a tax issue and found a favorable tax court opinion and an IRC Code Section that appear to answer the question. Is she finished with the research process? If so, why? If not, what must she do?

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Campbell is not finished. Once the tax r...

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Question 42

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If an individual taxpayer is unable to file a tax return by its original due date, the taxpayer can request an automatic nine-month extension to file the return.

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Question 43

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The Internal Revenue Code of 1986 is the name of the current income tax code of the United States of America.

Mary Ann is working on a pretty big research project. Her manager has alerted her to the possibility that some of her research questions are likely to be questions of fact, whereas others are likely to be questions of law. Explain the difference between the two types of questions and how this would influence her research.

If a taxpayer loses a case at the circuit court level, he is granted an automatic appeal hearing with the Supreme Court.

For the 2020 tax returns, indicate when the statute of limitations expires and why. a. Phoenix filed his tax return on February 28, 2021. b. Jill and Randy filed their tax return on August 16, 2021. c. Although required to file, Catherine chose not to file a tax return this year because she was expecting a tax refund and could not pull together all the information needed to file the return. d. Jerry filed his tax return on May 22, 2021, but has accidentally underreported his taxable income by 30 percent.

In researching a question of fact, the researcher should focus her efforts on identifying authorities with fact patterns similar to her client's facts.

The "90-day" letter gives the taxpayer the opportunity to pay a proposed IRS tax adjustment or file a petition in the U.S. District Court to contest the adjustment and hear the case.

Because the U.S. District Court hears a broader set of cases, decisions by the U.S. District Court may be considered to have more authoritative weight than those by the U.S. Court of Federal Claims.

Lakeisha, a first-year staff accountant, was researching a tax issue and found what appears to be the answer to her question in her introductory tax textbook that she bought three years ago. She is thrilled because she thought it would take much longer to find her answer. What type of authority is the textbook? What are other examples of this type of authority? Can Lakeisha base her research conclusion on the textbook or similar authorities? Any suggestions for Lakeisha?

Rebecca is at a loss. A new tax law was recently passed, and she needs to get a better understanding of why the tax law was passed and the intent of the law from an official authority. Describe what authorities may be especially helpful to Rebecca and why she can't find many authorities that discuss the new law.

Allen filed his 2020 tax return on May 15 ^th, 2021, and underreported his gross income by 30 percent. Assuming Allen's underreporting is not due to fraud, the statute of limitations for IRS assessment on Allen's 2020 tax return should end:

Roddy was researching an issue and found a favorable tax court decision that addresses his issue. He also determined that there was a nonacquiescence for the case. Who issued the nonacquiescence? What is it? What does it mean and how would it affect Roddy's reliance on the court case?

Carey was researching a tax issue and located what appears to be a favorable IRS regulation. He knows that regulations serve different purposes and are issued in different forms. Which purpose and which form of regulation would provide Carey the most confidence that he has found an authority that carries a lot of weight for the long term? How could Carey check the status of this regulation?

Dan received a letter from the IRS that gave him the choice of (1) requesting a conference with an appeals officer or (2) agreeing to a proposed tax adjustment. Dan received the:

The Internal Revenue Code and tax treaties are examples of statutory authorities.

Which of the following is not considered a secondary authority?

Rowanda could not settle her tax dispute with the IRS at the appeals conference. If she wants to litigate the issue but does not have sufficient funds to pay the proposed tax deficiency, Rowanda should litigate in the:

Princess, who resides in the 2 ^nd Circuit, recently found a circuit court case that is favorable to her income tax research question. Which of the following circuits would she prefer to have issued the opinion?

A tax practitioner can avoid IRS penalty relating to a tax return position: