Video: Internal Revenue Code and Tax Return Preparation Regulations - Practice Questions

In this lesson, Nick Palazzolo, CPA, navigates the intricacies of tax return preparer penalties as outlined in the Internal Revenue Code, using multiple-choice questions to bring clarity to the subject. He skillfully employs a hands-on approach to distinguish between penalties under the Internal Revenue Code and those under Circular 230. Nick demystifies a complex area by contrasting seemingly similar scenarios and providing strategies for identifying the correct answers during the exam. Engaging with practical examples, he breaks down why a certain answer choice stands out, guiding through the logic of elimination and the importance of understanding the underlying principles, which ultimately lead to choosing the most defensible tax positions during return preparation.

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Video Transcript

Instructor: Nick Palazzolo

Nick Palazzolo is head instructor of ExamPrep.ai CPA Review. Nick's teaching style is engaging & upbeat, combining practical Big 4 tax & assurance expertise with years of 1-on-1 coaching. His lessons are concise and emphasize what you need to know to pass. Whether you're a recent grad or working full-time, we’re confident you can conquer your CPA exams with Nick’s review.

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All right, you wonderful candidates, time to run through our multiple choice questions here. First off, tax return preparers can be subject to penalties under the Internal Revenue Code for failure to do any of the following except which? Now, I'm just gonna say it, there is a trick underlying this question. All of these items here can result in penalties. Give you a second to think about what is the caveat? What is the particular trick we've got waiting for you under here, going once, going twice? Well, this says under the Internal Revenue Code. Now, what else could result in a penalty? Circular 230, tell you there. So one of these items falls under Circular 230, the other three fall under the Internal Revenue Code. And there is a difference, right? Those are two distinct documents. Now, which of these falls under Circular 230 and as such does not fall under the Internal Revenue Code? Well, let's just say also, let's try a bunch of different approaches. First off, it's just memorization. Second off, which one of these is not like the other? So let's think about that. Yeah, you can think back to the lesson, but let's say you're on the exam and you're just at a loss, you're just, you're not sure. So which of these is not like the other? So something about providing a client with a copy of the tax return, disclosing conflict of interest, keep a record of returns prepared and sign a tax return as prepared. Now, I'd say A, B and D, these sound pretty similar, right? They all have to do, I'm sorry, A, C and D, these all have to do with the tax return, something about that, right? Whether it's keeping a record or providing it to

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Ethics and Responsibilities in Tax Practice

Module: 2 Concepts, 33 Videos

Internal Revenue Code and Tax Return Preparation Regulations Overview

4:17

Introduction to Internal Revenue Code and Tax Return Preparation Regulations

5:20

IRS Tax Forms

5:40

Types of Federal Taxes