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ACC 565 WEEK 5 MIDTERM EXAM
1) Tax planning is not an integral part of open-fact situations.
2) The Internal Revenue Code of 1986 contains the current version of the tax law.
3) Regulations issued prior to the latest tax legislation dealing with a specific Code section are still effective to the extent they do not conflict with the provisions in the new legislation.
4) Final regulations have almost the same legislative weight as the IRC.
5) A revenue ruling is issued by the Internal Revenue Service only in response to a verbal inquiry by a taxpayer.
6) Taxpayers must pay the disputed tax prior to filing a case with the Tax Court.
7) Appeals from the U.S. Tax Court are to the Court of Appeals for the Federal Circuit.
8) Appeals from the Court of Appeals go to the Supreme Court under a writ of certiorari. The Supreme Court decides whether or not they will hear the case.
9) A citator enables tax researchers to locate authorities (e.g., cases and IRS pronouncements) that have cited a particular case.
10) According to the Statements on Standards for Tax Services, CPAs must verify all tax return information submitted by reviewing client documentation.
11) When a taxpayer contacts a tax advisor requesting advice as to the most advantageous way to dispose of a stock, the tax advisor is faced with
A) a restricted-fact situation.
B) a closed-fact situation.
C) an open-fact situation.
D) a recognized-fact situation.
12) Investigation of a tax problem that involves a closed-fact situation means that
A) the client’s transactions have already occurred and the tax questions must now be resolved.
B) the client’s tax return has yet to be filed.
C) future events may be planned and controlled.
D) research is primarily concerned with applying the law to the facts as they exist.
13) Identify which of the following statements is true.
A) Tax planning is an integral part of both closed-fact situations and open-fact situations.
B) The first step in conducting tax research is to clearly understand the issues involved.
C) The Statements on Standards for Tax Services recommend that only written tax advice be provided to the client in all situations.
D) All of the above are false.