RulesoftaxlawdonotincludeRevenueRulingsandRevenueProcedures. True False ANSWER: RATIONALE:RulesoftaxlawdoincludeTreasuryDepartmentpronouncements. Ataxprofessionalneednotworryabouttherelativeweightofauthoritywithinthevarioustaxlawsources. True False ANSWER: False RATIONALE:Quitethecontrary. Inrecentyears,CongresshasbeenrelativelysuccessfulinsimplifyingtheInternalRevenueCode. True False ANSWER: False RATIONALE:EachyeartheCodebecomesmoreandmorecomplex. Ataxpayershouldalwaysminimizehisorhertaxliability. True False ANSWER: False RATIONALE:Ataxpayershouldmaximizetheafter-taxreturninconjunctionwiththeoveralleconomiceffect. Thefirstcodificationofthetaxlawoccurredin1954. True False ANSWER: False RATIONALE:Thefirstcodificationofthetaxlawoccurredin1939. TheCodesectioncitationisincorrect:§212(1). True ANSWER: False RATIONALE:SomeCodesectionsomitthesubsectionanduseparagraphdesignationasthefirstsubpartasdoes§212. SubchapterDreferstothe“CorporateDistributionsandAdjustments”sectionoftheInternalRevenueCode. True False
ANSWER: False RATIONALE:The correct subchapter for “Corporate Distributions and Adjustments” is Subchapter C. Regulationsaregenerallyissuedimmediatelyafterastatuteisenacted. True False ANSWER: False TemporaryRegulationsareonlypublishedintheInternalRevenueBulletin. True ANSWER: RATIONALE:TheyarepublishedintheFederalRegisterandtheInternalRevenueBulletin. RevenueRulingsissuedbytheNationalOfficeoftheIRScarrythesamelegalforceandeffectasRegulations. True False ANSWER: False RATIONALE:TheydonotcontainthesamelegalforceasRegulations.Thatis,thelegalforceisless. ARevenueRulingisajudicialsourceofFederaltaxlaw. True False ANSWER: False RATIONALE:ARevenueRulingisanadministrativesource. Thefollowingcitationcanbeacorrectcitation:Rev.Rul.95-271,1995-64I.R.B.18. True False ANSWER: False RevenueProceduresdealwiththeinternalmanagementpracticesandproceduresoftheIRS. True False ANSWER: True
True False ANSWER: True Aletterrulingappliesonlytothetaxpayerwhoasksforandobtainsaletterruling. True False ANSWER: True TheIRSisnotrequiredtomakealetterrulingpublic. True False ANSWER: False Determinationlettersusuallyinvolvefinalizedtransactions. True ANSWER: True TechnicalAdviceMemorandadealwithcompletedtransactions. True False ANSWER: True RATIONALE:TAMsdealwithcompletedtransactions. TechnicalAdviceMemorandamaynotbecitedasprecedentsbytaxpayers. True False ANSWER: True True False ANSWER: True
InaU.S.DistrictCourt,ajurycandecidebothquestionsoffactandquestionsoflaw. True False ANSWER: False RATIONALE:Questionsoflawareresolvedbythepresidingjudge. ThreejudgeswillnormallyheareachU.S.TaxCourtcase. True False ANSWER: False AtaxpayercanobtainajurytrialintheU.S.TaxCourt. True False ANSWER: RATIONALE:AjurytrialisavailableonlyinaU.S.DistrictCourt. AtaxpayermustpayanytaxdeficiencyassessedbytheIRSandsueforarefundtobringsuitintheU.S.DistrictCourt. True False ANSWER: True RATIONALE:The tax ArizonaisinthejurisdictionoftheEighthCircuitCourtofAppeals. True False ANSWER: False RATIONALE:ArizonaisinthejurisdictionoftheNinthCircuit. TexasisinthejurisdictionoftheSecondCircuitCourtofAppeals. True False ANSWER: False RATIONALE:TexasisinthejurisdictionoftheFifthCircuit. TheGolsenrulehasbeenoverturnedbytheU.S.SupremeCourt.
True False ANSWER: RATIONALE:TheGolsenruleisfollowedbytheU.S.TaxCourt. True False ANSWER: True The“petitioner”referstothepartyagainstwhomasuitisbrought. True False ANSWER: False RATIONALE:The“defendant”isthepartyagainstwhomasuitis brought. Theterm“petitioner”isasynonymfor“defendant.” True False ANSWER: RATIONALE:Theterm“petitioner”isasynonymfor“plaintiff.” TheU.S.TaxCourtmeetsmostofteninWashington,D.C. True False ANSWER: False RATIONALE:TaxCourtjudgestraveltovariouscities. Thereare11geographicU.S.CircuitCourtofAppeals. True False ANSWER: True Thefollowingcitationiscorrect:LarryG.Mitchell,131T.C.215(2008). True False
ANSWER: True TheIRSissuesanacquiescenceornonacquiescenceonlyforregularTaxCourtdecisions. True False ANSWER: RATIONALE:After1990,theIRSissuesitsacquiescenceprogramforotherciviltaxcases. True False ANSWER: False RATIONALE:Themostrecentitemtakesprecedence. TheIndextoFederalTaxArticles(publishedbyWarren,Gorham,andLamont)isavailableinprintandelectronicformats. True False ANSWER: False RATIONALE:Itisavailableonlyinprintform. AU.S.DistrictCourtisthelowesttrialcourt. True False ANSWER: True Theresearchprocessshouldbeginwithataxservice. True False ANSWER: False RATIONALE:Iftheresearchissimple,aresearchermaystartwiththeCodeorRegulations. Electronicdatabasesaremostfrequentlysearchedbythekeywordapproach. True False ANSWER: True Thetestforwhetherachildqualifiesfordependencystatusisfirstconductedunderthequalifiedchildrequirement. True False ANSWER: True
BudgetCommittee. Noneoftheabove. ANSWER: b Federaltaxlegislationgenerallyoriginatesinwhatbody? InternalRevenueService. SenateFinanceCommittee. HouseWaysandMeansCommittee. SenateFloor. Noneoftheabove. ANSWER: c SubtitleAoftheInternalRevenueCodecoverswhichofthefollowingtaxes? Incometaxes. Estateandgifttaxes. Excisetaxes. Employmenttaxes. Alloftheabove. ANSWER: a In§212(1),thenumber(1)standsforthe: Sectionnumber. Subsectionnumber. Paragraphdesignation. Subparagraphdesignation. Noneoftheabove. ANSWER: c WhichoftheseisnotacorrectcitationtotheInternalRevenueCode? Section211. Section1222(1). Section2(a)(1)(A). Section280B. Allofabovearecorrectcites. ANSWER: e Whichofthefollowingisnotanadministrativesourceoftaxlaw? FieldServiceAdvice. RevenueProcedure.
TechnicalAdviceMemoranda. U.S.DistrictCourtdecision. Noneoftheabove. ANSWER: c WhatstatementisnottruewithrespecttoTemporaryRegulations? Maynotbecitedasprecedent. IssuedasProposedRegulations. Automaticallyexpirewithinthreeyearsafterthedateofissuance. FoundintheFederalRegister. Alloftheabovestatementsaretrue. ANSWER: a Whatadministrativereleasedealswithaproposedtransactionratherthanacompletedtransaction? LetterRuling. TechnicalAdviceMemorandum. DeterminationLetter. FieldServiceAdvice. Noneoftheabove. ANSWER: a Whichofthefollowingindicatesthatadecisionhasprecedentialvalueforfuturecases? Staredecisis. Golsendoctrine. Enbanc. Reenactmentdoctrine. Noneoftheabove. ANSWER: a AtaxpayerwholosesinaU.S.DistrictCourtmayappealdirectlytothe: U.S.SupremeCourt. U.S.TaxCourt. U.S.CourtofFederalClaims. U.S.CircuitCourtofAppeals. Alloftheabove. ANSWER: d RATIONALE: AppealsfromaU.S.DistrictCourtgotothetaxpayer’shomecircuitoftheU.S.CircuitCourtofAppeals. Ifataxpayerdecidesnottopayataxdeficiency,heorshemustgotowhichcourt?
AppropriateU.S.CircuitCourtofAppeals. U.S.DistrictCourt. U.S.TaxCourt. U.S.CourtofFederalClaims. Noneoftheabove. ANSWER: c Ajurytrialisavailableinthefollowingtrialcourt: U.S.TaxCourt. U.S.CourtofFederalClaims. U.S.DistrictCourt. U.S.CircuitCourtofAppeals. Noneoftheabove. ANSWER: c Ataxpayermaynotappealacasefromwhichcourt: U.S.DistrictCourt. U.S.CircuitCourtofAppeals. U.S.CourtofFederalClaims. SmallCaseDivisionoftheU.S.TaxCourt. Noneoftheabove. ANSWER: d TheIRSwillnotacquiescetothefollowingtaxdecisions: U.S.DistrictCourt. U.S.TaxCourt. U.S.CourtofFederalClaims. SmallCaseDivisionoftheU.S.TaxCourt. Alloftheabove. ANSWER: d WhichpublisherofferstheStandardFederalTaxReporter? ResearchInstituteofAmerica. CommerceClearingHouse. Prentice-Hall. LexisNexis. Noneoftheabove. ANSWER: b Whichispresentlynotamajortaxservice? StandardFederalTaxReporter. FederalTaxes.
UnitedStatesTaxReporter. TaxManagementPortfolios. Alloftheabovearemajortaxservices. ANSWER: b WhichpublisherofferstheUnitedStatesTaxReporter? ResearchInstituteofAmerica. CommerceClearingHouse. LexisNexis. TaxAnalysts. Noneoftheabove. ANSWER: a Whensearchingonanonlinetaxservice,whichapproachismorefrequentlyused? Codesectionapproach. Keywordapproach. Tableofcontentsapproach. Index. Allareaboutthesame. ANSWER: b Aresearchercanfindtaxinformationonhomepagesitesof: Governmentalbodies. Taxacademics. Publishers. CPAfirms. Alloftheabove. ANSWER: e Taxresearchinvolveswhichofthefollowingprocedures: Identifyingandrefiningtheproblem. Locatingtheappropriatetaxlawsources. Assessingthevalidityofthetaxlawsources. Follow-up. Alloftheabove. ANSWER: e Whichtax-relatedwebsiteprobablygivesthebestpolicy-orientationresults? taxalmanac.org.
JohnWiley&Sons. CommerceClearingHouse. ResearchInstituteofAmerica. Westlaw. Shepard’s. ANSWER: a Whichisnotaprimarysourceoftaxlaw? a.Notice89-99,1989-2C.B.422. b.EstateofHarryHolmesv.Comm.,326U.S.480(1946). c.Rev.Rul.79-353,1979-2C.B.325. e.Alloftheaboveareprimarysources. ANSWER: d WhichstatementisincorrectwithrespecttotaxationontheCPAexam? TheCPAexamnowhasonlyfourparts. Therearenolongercasestudiesontheexam. Acandidatemaynotgobackafterexitingatestlet. Simulationsincludeafour-functionpop-upcalculator. Noneoftheaboveareincorrect. ANSWER: b HowcanCongressionalCommitteeReportsbeusedbyataxresearcher? ANSWER: WhatareTreasuryDepartmentRegulations? ANSWER: RegulationsareissuedbytheU.S.TreasuryDepartmentunderauthoritygrantedbyCongress. CompareRevenueRulingswithRevenueProcedures. ANSWER: