South-western Federal Taxation 2018: Individual Income Taxes
41st Edition
ISBN: 9781337385886
Author: William H. Hoffman, James C. Young, William A. Raabe, David M. Maloney, Annette Nellen
Publisher: Cengage Learning
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Chapter 1, Problem 36DQ
To determine
Comment on the given statements with respect to the IRS
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Tax Drill - Types of Audits
Complete the following statements regarding the types of audit conducted by the IRS.
Taxpayers usually are able to settle routine tax disputes (e.g., queries involving the documentation of deductions) through with the IRS. However, are conducted in an office of the IRS. In most instances, the taxpayer is subject to . A is conducted by IRS agents at the office or home of the taxpayer or at the office of the taxpayer's representative.
The official document issued by the CIR or his authorized representative authorizing the examination of taxpayer records is called:
a.Authorization letter
b.Letter Notice
c.Letter of Authority
d.Mission Order
Which is NOT a power of the Commissioner?
a.The power to abandon previous rulings
b.The power to enter into a compromise
c.The power to issue revenue regulations
d.The power to issue rulings of first impression
The Taxpayer Advocate Service (TAS) can help taxpayers with what type of assistance? As a first step, rather than dealing with the IRS, when the taxpayer believes there are unusual circumstances involved. When the taxpayer feels the resolution applied by the IRS is unreasonable. If there is a financial difficulty, emergency, or hardship and the IRS needs to move faster than normal. When an audit results in a significant change and the deadline for appeal has passed.
Note:-
Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.
Answer completely.
You will get up vote for sure.
Chapter 1 Solutions
South-western Federal Taxation 2018: Individual Income Taxes
Ch. 1 - Prob. 1DQCh. 1 - Prob. 2DQCh. 1 - The Sixteenth Amendment to the U.S. Constitution...Ch. 1 - Prob. 4DQCh. 1 - How does the pay-as-you-go procedure apply to wage...Ch. 1 - Jane, a tax practitioner, has reviewed the law on...Ch. 1 - Prob. 7DQCh. 1 - Prob. 8DQCh. 1 - Prob. 9DQCh. 1 - Prob. 10DQ
Ch. 1 - Sophia lives several blocks from her parents in...Ch. 1 - Prob. 12DQCh. 1 - Prob. 13DQCh. 1 - Prob. 14DQCh. 1 - Prob. 15DQCh. 1 - Prob. 16DQCh. 1 - Prob. 17DQCh. 1 - Prob. 18DQCh. 1 - Prob. 19DQCh. 1 - Prob. 20DQCh. 1 - Prob. 21DQCh. 1 - What is the difference between the Federal income...Ch. 1 - As to those states that impose an income tax,...Ch. 1 - Prob. 24DQCh. 1 - Prob. 25DQCh. 1 - Prob. 26DQCh. 1 - Prob. 27DQCh. 1 - Prob. 28DQCh. 1 - Contrast FICA and FUTA as to the following: a....Ch. 1 - Prob. 30DQCh. 1 - Prob. 31DQCh. 1 - Prob. 32DQCh. 1 - Prob. 33DQCh. 1 - Prob. 34DQCh. 1 - Serena operates a gift shop. To reduce costs of...Ch. 1 - Prob. 36DQCh. 1 - Prob. 37DQCh. 1 - Prob. 38DQCh. 1 - Prob. 39DQCh. 1 - Prob. 40DQCh. 1 - Prob. 41DQCh. 1 - Prob. 42DQCh. 1 - Prob. 43DQCh. 1 - Prob. 44DQCh. 1 - Prob. 45DQCh. 1 - Prob. 46DQCh. 1 - Prob. 47DQCh. 1 - Prob. 48DQCh. 1 - Prob. 49DQCh. 1 - Prob. 50DQCh. 1 - Using information from this chapter as well as...Ch. 1 - Prob. 3RP
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- Which of the following is true if an auditor performs nonaudit services for a governmententity?a. The scope of the audit must be reduced so that the auditor does not audit the area forwhich the nonaudit work was performed.b. The auditor is prohibited from providing nonaudit work in areas directly related to theproduction of accounting information.c. The senior members of the government entity must document their review of the nonaudit service and indicate why it is appropriate for the auditors to perform this service.d. The scope of the audit cannot be reduced because the nonaudit work was performed bythe public accounting firm.arrow_forwardThe IRS utilizes different audits depending upon the circumstances. I have listed 4 different scenarios. Please identify the type of audit that the IRS will likely use. Only provide one type of audit per scenario, the best option for the IRS. a. Professor Abbie B. Comey had a large amount of itemized deductions and the IRS would like to see documentation of these deductions. b. Trumff Corporation is a publicly traded corporation and has many transactions and many of them are very complex. The transactions, with large tax consequences, has reduced the tax liability of the corporation to $750. It is a large national chain of hotels headquartered in Florida. c. Ivanna and Jarry make face masks for the rich and famous, resulting in an income from their small homebased business of $75,000 in 2020. A few items were noted on the tax return by the IRS, relating to the homebased mask making business. d . Joey and Jilly sold some investments that sparked the interest of the IRS. As a result,…arrow_forwardWhich of the following types of audit evidence provides the least assurance of reliability? A. Receivable confirmations received from the client's customers B. prenumbered receiving reports completed by the client's employees C. Prior months' bank statements obtained from the client D. Municipal property tax bills prepared in the client's name.arrow_forward
- Accoring to the AICPA Code of Professional Conduct, which of the following activities result in an act discredible to the profession? A. A CPA solicits recent niform PA Examination questions without written authorization from the AICPA. B. A CPA signs a document containing immaterial false and misleading information, or permits or directs aother CPA to do so. C. A CPA who is engaged to perform a government audit neglects to follow certain government auditing requirements and discloses in the audit report the fact that such requirements were NOT followed ad te reasons for it. D. A CPA fails to give a client copies of the CPA's workpapers related to a completed and issued work product upon the clients request because the cliet has not paid fees payable to the CPA for the work product.arrow_forwardExplain what is meant by determining the degree of correspondencebetween information and established criteria. What are the information and establishedcriteria for the audit of Jones Company’s tax return by an internal revenue agent? Whatare they for the audit of Jones Company’s financial statements by a CPA firm?arrow_forwardWhat are the primary types of tax audits conducted by taxing authorities? a) Random audits and targeted audits b) Field audits and desk audits c) Pre - filing audits and post - filing audits d) Internal audits and external auditsarrow_forward
- If the audit does not turn out favorably: (Select all that apply.) A. Mrs. Hubbard can file an appeal with the auditor by presenting additional materials. B. Mrs. Hubbard can file an appeal with the auditor's manager. C. Mrs. Hubbard can go to a tax court. D. Mrs. Hubbard can file a formal appeal with the IRS.arrow_forwardMrs. Hubbard, a mother of two, has been selected for an audit. Advise her on what to do to prepare for the audit and what to do if the audit does not turn out favorably. Question content area bottom Part 1 To prepare for the audit: (Select all that apply.) A. Mrs. Hubbard should hire an accountant or tax attorney, if necessary. B. Mrs. Hubbard should anticipate probable questions and develop responses. C. Mrs. Hubbard should gather all supporting documents. D. Mrs. Hubbard should reexamine the areas where the IRS raised questions.arrow_forwardWhich non-audit service may be provided to an SEC audit client? A- )Preparing the annual tax returns for review and approval by the client. B- )Designing the future state operating model for its finance and accounting functions. C- )Performing a valuation to support the client’s legal claim. D- )Developing, managing and executing portions of its internal audit plan.arrow_forward
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