Deck 2: Working With the Tax Law

Question 1

Temporary Regulations are only published in the Internal Revenue Bulletin.

Answer 1

False

Question 2

Technical Advice Memoranda may not be cited as precedents by taxpayers.

Answer 2

True

Question 3

The IRS is not required to make a letter ruling public.

Answer 3

False

Question 4

In general, Regulations are issued immediately after a statute is enacted.

Question 5

Revenue Procedures deal with the internal management practices and procedures of the IRS.

Question 6

A taxpayer must pay any tax deficiency assessed by the IRS and sue for a refund to bring suit in the U.S. Court of Federal Claims. Only in the Tax Court can jurisdiction be obtained without first paying the assessed tax deficiency.

Question 7

Subchapter D refers to the "Corporate Distributions and Adjustments" section of the Internal Revenue Code.

Question 8

Revenue Rulings issued by the National Office of the IRS carry the same legal force and effect as Regulations.

Question 9

A Revenue Ruling is a judicial source of Federal tax law.

Question 10

This Internal Revenue Code section citation is incorrect: § 212(1).

Question 11

A letter ruling applies only to the taxpayer who asks for and obtains a letter ruling.

Question 12

The first codification of the tax law occurred in 1954.

Question 13

Rules of tax law do not include Revenue Rulings and Revenue Procedures.

Question 14

Technical Advice Memoranda deal with completed transactions.

Question 15

A tax professional need not worry about the relative weight of authority within the various tax law sources.

Question 16

In recent years, Congress has been relatively successful in simplifying the Internal Revenue Code.

Question 17

Post-1984 letter rulings may be substantial authority for purposes of the accuracy-related penalty in § 6662.

Question 18

The following citation could be a correct citation: Rev. Rul. 95-271,1995-64 I.R.B. 18.

Question 19

Determination letters usually involve completed transactions.

Question 20

A taxpayer should always minimize his or her tax liability.

Question 21

Three judges will normally hear each U.S. Tax Court case.

Question 22

The petitioner refers to the party against whom a suit is brought.

Question 23

A taxpayer can obtain a jury trial in the U.S. Tax Court.

Question 24

Electronic (online) databases are most frequently searched by the keyword approach.

Question 25

There is a direct conflict between an Internal Revenue Code section adopted in 2010 and a treaty with France
(signed in 2016). The Internal Revenue Code section controls.

Question 26

The following citation is correct: Larry G. Mitchell, 131 T.C. 215 (2008).

Question 27

The U.S. Tax Court meets most often in Washington, D.C.

Question 28

Arizona is in the jurisdiction of the Eighth Circuit Court of Appeals.

Question 29

There are 11 geographic U.S. Circuit Court of Appeals.

Question 30

The research process should always begin with a tax service.

Question 31

A treasure trove is taxable when sold or exchanged.

Question 32

The Index to Federal Tax Articles (published by Thomson Reuters) is available electronically.

Question 33

A U.S. District Court is considered the lowest trial court.

Question 34

The IRS issues an acquiescence or nonacquiescence only for regular Tax Court decisions.

Question 35

A taxpayer must pay any tax deficiency assessed by the IRS and sue for a refund to bring suit in the U.S. District
Court.

Question 36

Texas is in the jurisdiction of the Second Circuit Court of Appeals.

Question 37

The term petitioner is a synonym for defendant.

Question 38

The granting of a Writ of Certiorari indicates that at least four members of the Supreme Court believe that an issue is of sufficient importance to be heard by the full court.

Question 39

The Golsen rule has been overturned by the U.S. Supreme Court.

Question 40

In a U.S. District Court, a jury can decide both questions of fact and questions of law.

Question 41

Federal tax legislation generally originates in which of the following?

A) Internal Revenue Service
B) Senate Finance Committee
C) House Ways and Means Committee
D) Senate Floor
E) None of these

Question 42

The primary purpose of effective tax planning is to reduce or defer the tax in the current tax year.

Question 43

Normally, when the Senate version of a tax bill differs from that passed by the House, a Joint Conference
Committee drafts a compromise tax bill.

Question 44

A Temporary Regulation under § 303 of the Code would be cited as follows: Temp. Reg. § 303.

Question 45

Deferring income to a subsequent year is considered to be tax avoidance.

Question 46

In § 212(1), the number (1) stands for the:

A) Section number.
B) Subsection number.
C) Paragraph designation.
D) Subparagraph designation.
E) None of these.

Question 47

The Tax Cuts and Jobs Act of 2017 became part of the Internal Revenue Code of 1986.

Question 48

Subchapter C refers to the subchapter in the Internal Revenue Code that deals with partnerships and partners.

Question 49

Revenue tax measures typically originate in the Senate Finance Committee of the U.S. Congress.

Question 50

Revenue Rulings are first published in the Internal Revenue Bulletin.

Question 51

Subtitle A of the Internal Revenue Code covers which of the following taxes?

A) Income taxes
B) Estate and gift taxes
C) Excise taxes
D) Employment taxes
E) All of these

Question 52

Which of these is not a correct citation to the Internal Revenue Code?

A) Section 211
B) Section 1222(1)
C) Section 2(a)(1)(A)
D) Section 280B
E) All of these are correct cites.

Question 53

Tax planning usually involves a completed transaction.

Question 54

The Regulation section of the CPA exam is approximately 80% Taxation and 20% Law & Professional
Responsibilities.

Question 55

A Bluebook is substantial authority for purposes of the accuracy related penalty.

Question 56

Before a tax bill can become law, it must be approved (signed) by the President of the United States.

Question 57

Revenue Rulings issued by the National Office of the IRS carry the same legal force and effect as Regulations.

Question 58

The Internal Revenue Code was first codified in what year?

A) 1913
B) 1923
C) 1939
D) 1954
E) 1986

Question 59

Tax bills are handled by which committee in the U.S. House of Representatives?

A) Taxation Committee
B) Ways and Means Committee
C) Finance Committee
D) Budget Committee
E) None of these

Question 60

Currently, the Internal Revenue Code of 1986 does not contain §§ 308, 309, and 310. This absence means these sections were repealed by Congress.

Question 61

Which of the following is not an administrative source of tax law?

A) Field Service Advice
B) Revenue Procedure
C) Technical Advice Memoranda
D) General Counsel Memorandum
E) All of these are administrative sources.

Question 62

A taxpayer who loses in a U.S. District Court may appeal directly to the:

A) U.S. Supreme Court.
B) U.S. Tax Court.
C) U.S. Court of Federal Claims.
D) U.S. Circuit Court of Appeals.
E) All of these.

Question 63

A researcher can find tax information on home page sites of:

A) Governmental bodies.
B) Tax academics.
C) Publishers.
D) CPA firms.
E) All of these.

Question 64

Which item may not be cited as a precedent?

A) Regulations
B) Temporary Regulations
C) Technical Advice Memoranda
D) U.S. District Court decision
E) None of these

Question 65

Which of the following indicates that a decision has precedential value for future cases?

A) Stare decisis
B) Golsen doctrine
C) En banc
D) Reenactment doctrine
E) None of these

Question 66

A jury trial is available in the following trial court:

A) U.S. Tax Court.
B) U.S. Court of Federal Claims.
C) U.S. District Court.
D) U.S. Circuit Court of Appeals.
E) None of these.

Question 67

Which is presently not a major tax service?

A) Standard Federal Tax Reporter
B) Federal Taxes
C) United States Tax Reporter
D) Tax Management Portfolios
E) All of these are major tax services

Question 68

What administrative release deals with a proposed transaction rather than a completed transaction?

A) Letter Ruling
B) Technical Advice Memorandum
C) Determination Letter
D) Field Service Advice
E) None of these

Question 69

Which of the following sources has the highest tax validity?

A) Revenue Ruling
B) Revenue Procedure
C) Regulations
D) Internal Revenue Code section
E) None of these

Question 70

If a taxpayer decides not to pay a tax deficiency, he or she must go to which court?

A) Appropriate U.S. Circuit Court of Appeals
B) U.S. District Court
C) U.S. Tax Court
D) U.S. Court of Federal Claims
E) None of these

Question 71

Which statement is not true with respect to a Regulation that interprets the tax law?

A) Issued by the U.S. Congress.
B) Issued by the U.S. Treasury Department.
C) Designed to provide an interpretation of the tax law.
D) Carries more legal force than a Revenue Ruling.
E) All of these statements are true.

Question 72

What statement is not true with respect to Temporary Regulations?

A) May not be cited as precedent.
B) Issued with Proposed Regulations.
C) Automatically expire within three years after the date of issuance.
D) Found in the Federal Register.
E) All of these statements are true.

Question 73

When searching on an electronic (online) tax service, which approach is more frequently used?

A) Internal Revenue Code section approach
B) Keyword approach
C) Table of contents approach
D) Index
E) All are about the same

Question 74

Tax research involves which of the following procedures:

A) Identifying and refining the problem.
B) Locating the appropriate tax law sources.
C) Assessing the validity of the tax law sources.
D) Follow-up.
E) All of these.

Question 75

A taxpayer may not appeal a case from which court:

A) U.S. District Court.
B) U.S. Circuit Court of Appeals.
C) U.S. Court of Federal Claims.
D) Small Case Division of the U.S. Tax Court.
E) None of these.

Question 76

The IRS will not acquiesce to the following tax decisions:

A) U.S. District Court.
B) U.S. Tax Court.
C) U.S. Court of Federal Claims.
D) Small Case Division of the U.S. Tax Court.
E) All of these.

Question 77

Which publisher offers the Standard Federal Tax Reporter?

A) Research Institute of America
B) Commerce Clearing House
C) Thomson Reuters
D) LexisNexis
E) None of these

Question 78

Which of the following types of Regulations has the highest tax validity?

A) Temporary
B) Legislative
C) Interpretive
D) Procedural
E) None of these

Question 79

Which publisher offers the United States Tax Reporter?

A) Research Institute of America (Thomson Reuters)
B) Commerce Clearing House
C) LexisNexis
D) Tax Analysts
E) None of these

Question 80

In addressing the importance of a Regulation, an IRS agent must:

A) Give equal weight to the Internal Revenue Code and the Regulations.
B) Give more weight to the Internal Revenue Code rather than to a Regulation.
C) Give more weight to the Regulation rather than to the Internal Revenue Code.
D) Give less weight to the Internal Revenue Code rather than to a Regulation.
E) None of these.