Under Treasury Department Circular 230, a tax practitioner who knows of a client's omission from a previously filed return must:
Cpa Reg Ethics Procedures
Question · Easy
The late filing blues
Short
A CPA preparing a client's federal income tax return discovers an aggressive position with a 35% chance of being sustained on the merits. Under IRC §6694, the preparer can avoid the understatement penalty if the position is:
Introduction & Exam Overview
1.1 Current Exam Facts
Study guide
AICPA Statements on Standards for Tax Services (SSTS) No. 1 addresses:
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A taxpayer files a calendar-year 2024 return on April 15, 2025. What is the latest date the IRS may generally assess additional tax under the normal §6501 statute of limitations?
Under IRC §6662, the accuracy-related penalty for substantial understatement of income tax (individual) generally applies when the understatement exceeds:
Capital losses, by text
A CPA is contacted by the IRS regarding her client's audit. To represent the client before the IRS Examination Division, the CPA must:
1.2 Format, Scoring, and Skill Levels
Under IRC §7525, the federally authorized tax practitioner-client privilege extends to:
Question · Medium
An IRS notice of deficiency (90-day letter) gives the taxpayer how long to file a petition with the U.S. Tax Court without first paying the tax?
Under Circular 230 §10.34, a practitioner may sign a tax return containing a position that has a reasonable basis but lacks substantial authority only if:
The IRS issues a 30-day letter following an examination. The taxpayer's response options include all EXCEPT:
1.3 New Pronouncements and OBBBA Testing Policy
Under §6694(b), a tax return preparer faces a willful or reckless conduct penalty equal to the greater of $5,000 or what percentage of the income derived from preparing the return?
Under Circular 230, contingent fees by a tax practitioner are generally:
Failure to file a federal return by the due date generally triggers a §6651(a)(1) failure-to-file penalty of:
An enrolled agent and a CPA may both represent taxpayers before the IRS. Which statement about enrolled agents is correct?
1.4 Study Strategy and Task-Based Simulations
Under §7216, a tax return preparer who knowingly or recklessly discloses tax return information without the taxpayer's consent commits:
Question · Hard
Under UCC Article 2, which contract for the sale of goods must be in writing to be enforceable under the statute of frauds?
Cpa Reg Business Law
A merchant offers in writing to sell 100 widgets at $10 each, stating the offer is firm for 60 days. Under UCC §2-205 (firm offer rule), the offer is irrevocable for:
Under UCC §2-207 (battle of the forms) between merchants, additional terms in an acceptance generally:
Circular 230 and Tax Return Preparers
2.1 Practice Before the IRS under Circular 230
Risk of loss for goods being shipped under a 'shipment contract' (FOB seller's place) passes to the buyer when:
Under UCC §2-314, an implied warranty of merchantability arises only when:
Under UCC Article 9, a security interest in collateral generally attaches when:
A purchase money security interest (PMSI) in non-inventory consumer goods is automatically perfected:
2.2 Diligence, Written Advice, Fees, and Records
Under UCC §9-322, when two security interests are perfected by filing, priority generally goes to:
An agent who exceeds the scope of actual authority but acts within the scope of apparent authority binds the principal because:
Under the Revised Uniform Partnership Act (RUPA), which event does NOT necessarily cause dissolution of a partnership?
Under the Securities Act of 1933, which transaction is generally NOT exempt from federal registration?
2.3 Tax Return Preparer Identification and Penalties
Under §10(b) and Rule 10b-5 of the Securities Exchange Act of 1934, a private plaintiff in a securities fraud action must prove:
Under the Fair Labor Standards Act (FLSA), an employer must pay overtime at 1.5× the regular rate for hours worked beyond:
For 2026, the FICA Social Security wage base is approximately $176,100 (2025) with annual COLA adjustments. The combined employer/employee Social Security tax rate is:
Under the Age Discrimination in Employment Act (ADEA), the law protects employees age:
Licensing, Audits, Appeals, and Disclosure
3.1 State Board Licensing and Disciplinary Systems
Under the Americans with Disabilities Act (ADA), an employer with how many employees is generally subject to the law's employment provisions?
Under common law, which element is NOT required for a valid contract?
Adam owes Barbara $10,000. Adam offers to pay Barbara $7,000 in full satisfaction of the debt because of his financial difficulties. Barbara accepts $7,000 and a signed release. Under common law, this is generally:
Under the Sarbanes-Oxley Act §302, the principal executive and financial officers of a public company must certify in each periodic report that:
3.2 IRS Audits, Appeals, and the Judicial Process
Sarah purchases land for $50,000. Three years later, when the land is worth $80,000, she gives it to her son David. Two years later David sells the land for $90,000. David's recognized gain is:
Cpa Reg Property Tax
Inherited property generally takes a basis equal to:
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