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

A. only if the position has a more likely than not chance of being sustained by the IRS or courts.

B. if the position has a realistic possibility of being sustained by the IRS or courts.

C. if there is not substantial authority to support the position.

D. if the position has a reasonable basis and is disclosed on the tax return.

E. None of these.

Answer: D. if the position has a reasonable basis and is disclosed on the tax return.

Which of the following is a false statement? A taxpayer filing a fraudulent tax return:

A. is potentially subject to criminal penalties.

B. is potentially subject to civil penalties.

C. is potentially subject to fines and a prison sentence.

D. will have an unlimited statute of limitations for the fraudulent tax return.

E. None of these.

Answer: E. None of these.

For which of the following tax violations is a civil penalty not imposed on taxpayers?

A. failure to file a tax return.

B. failure to pay tax owed.

C. fraud.

D. failure to make estimated tax payments.

E. None of these.

Answer: E. None of these.

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

A. if the position is frivolous and disclosed on the tax return.

B. if the position has a realistic possibility of being sustained by the IRS or courts.

C. if there is substantial authority to support the position.

D. if the position has a reasonable basis and is not disclosed on the tax return.

E. None of these.

Answer: C. if there is substantial authority to support the position.