| The IRS can censure, suspend, or disbar a practitioner from practice before the Internal Revenue Service for incompetence and/or disreputable conduct. Which one of the following is considered disreputable conduct? |
| An attorney, a CPA, or an enrolled agent may be reprimanded, suspended, or disbarred from practice before the IRS for willful violations of any of the regulations contained in Circular 230. Three of the acts specifically mentioned are conviction of any felony involving conduct that renders the practitioner unfit to practice before the IRS, conviction of any offense involving dishonesty or breach of trust, and providing false or misleading information to the Treasury Department, including the IRS. |
| Failure to file an answer to a complaint instituting a proceeding for disbarment by the original or extended deadline constitutes |
| If a respondent fails to answer a complaint filed by the IRS for disbarment, the IRS and/or the administrative law judge may treat the respondent as if (s)he had admitted all allegations and waived a hearing (Circular 230). |
| For taxpayers who want someone to represent them in their absence at an examination or an appeal within the IRS, all of the following statements are true EXCEPT |
Only attorneys, CPAs, and enrolled agents may represent a taxpayer before anyone at the IRS. Annual Filing Season Program participants may appear as the taxpayer’s representative before revenue agents or customer service representatives during an examination, but not before appeals officers, revenue officers, or counsel at an appeal. Tax preparers without a certification may not practice before anyone at the IRS.
| Select the statement below that is true with respect to the contents of an answer that is filed in rebuttal to a complaint filed by the IRS. |
| If the IRS has reason to believe an agent has violated a law or regulation governing practice before the IRS, the IRS may reprimand the agent or institute a proceeding for suspension or disbarment. An answer must be filed in writing within the time specified in the complaint. The answer must contain a statement of facts that constitute the grounds for defense and specifically admit or deny each allegation set forth in the complaint. The respondent may not deny a material allegation that (s)he knows to be true or state that (s)he lacks sufficient information to form a belief when (s)he has such information. |
| Which of the following practitioners with the responsibility of oversight of return preparation will be subject to disciplinary action? |
| Any practitioner with oversight of return preparation will be subject to disciplinary action if the practitioner does not take reasonable steps to ensure that the firm has adequate procedures to comply with Circular 230, and an employee of the firm has engaged in a pattern or practice, in connection with their practice with the firm, of failing to comply with Circular 230. |
| Under Treasury Circular 230, which of the following actions of a CPA tax advisor is characteristic of a best practice in rendering tax advice? |
| Best practices include (1) establishing the facts, determining which facts are relevant, evaluating the reasonableness of any assumptions or representations, relating applicable law (including potentially applicable judicial doctrines) to the relevant facts, and arriving at a conclusion supported by the law and the facts; (2) communicating clearly with the client about the terms of the engagement; (3) advising the client regarding the importance of the conclusions reached; and (4) acting fairly and with integrity in practice before the IRS. |
| All of the following are examples of disreputable conduct for which an enrolled agent may be disbarred or suspended from practice before the Internal Revenue Service EXCEPT |
| Section 10.51 of Circular 230 lists several examples of disreputable conduct for which an enrolled agent may be disbarred or suspended from practice before the Internal Revenue Service. Solicitation by mailings, the contents of which are designed for the general public, is not prohibited under Sec. 10.30(a)(2) and is not disreputable conduct under Sec. 10.51 of Circular 230. |
| A tax advisor with what responsibility should take reasonable steps to ensure that the firm’s procedures for all members, associates, and employees are consistent with the best practices? |
| Tax advisors with responsibility for overseeing a firm’s practice of providing advice concerning federal tax issues or of preparing or assisting in the preparation of submissions to the Internal Revenue Service should take reasonable steps to ensure that the firm’s procedures for all members, associates, and employees are consistent with the best practices. |
| Tax advisors should adhere to “best practices” in providing advice and in preparing a submission to the IRS. Best practices include all of the following EXCEPT |
The correct answer failed to include the law as a basis of support for a conclusion.
| Treasury Circular 230 |
| Treasury Circular 230 governs the practice of attorneys, CPAs, enrolled agents, enrolled retirement plan agents, enrolled actuaries, and appraisers before the IRS, and includes the rules regarding eligibility to become an enrolled agent and rules for renewal of enrollment (see Circular 230). |
| With regard to the categories of individuals who may practice before the Internal Revenue Service, all of the following statements are true, EXCEPT |
| An individual who is not an enrolled agent, CPA, or attorney, but meets the Annual Filing Season Program (AFSP) requirements who signs a return as having prepared it for the taxpayer may appear as the taxpayer’s representative before the Examination Division of the IRS, but not before revenue officers, appeals officers, or counsel. If the preparer is not an AFSP, no representation before the IRS is allowed unless they qualify under another provision. |
| Identify the appropriate action that a practitioner should take when (s)he becomes aware of an error or omission on a client’s return. |
Section 10.21 of Treasury Department Circular 230 requires a practitioner who knows that a client has not complied with the revenue laws of the United States to promptly advise the client of the noncompliance, error, or omission and the consequences of the noncompliance, error, or omission as provided in the IRC and regulations.
| All of the following can practice before the Internal Revenue Service EXCEPT |
| Circular 230 states that attorneys, CPAs, enrolled agents, and other individuals who qualify under Sec. 10.7 for limited practice may practice before the IRS. The individuals who qualify are a taxpayer representing himself or herself; an individual representing a family member; a full-time employee of a company; a partner; a bona fide officer of a corporation, an association, or an organized group that represents the corporation or association; and a trustee, an administrator, or an executor of a trust or an estate. Any individual who has been convicted of any offense involving dishonesty or breach of trust cannot practice before the IRS. |
| Identify the individual below from whom an enrolled agent, in practice before the Internal Revenue Service, may knowingly accept assistance. |
Section 10.24 of Circular 230 states that no practitioner shall, in practice before the Internal Revenue Service, knowingly and directly or indirectly assist or accept assistance (related to matters constituting practice) from any person who is under disbarment or suspension from practice before the Internal Revenue Service or accept assistance from any former government employee where the provisions of any federal law would be violated.
| Frank, a certified public accountant, has the right to make the following solicitations of employment involving IRS matters: |
| Under Circular 230, Sec. 10.30, any lawful solicitation must clearly identify the solicitation as such and, if applicable, identify the source of the information used in choosing the recipient. |
