Test Bank for South-Western Federal Taxation 2024: Comprehensive Volume, 47e 47th Edition by Mark Persellin, Annette Nellen, Mark Persellin, Andrew D. Cuccia, Sharon Lassar, Brad Cripe. Full Chapters test bank are included - Chap 1 to 30
Part I: INTRODUCTION AND BASIC TAX MODEL.
1. An Introduct...
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Test Bank South-Western Federal Taxation 2024: Comprehensive 47e
Persellin
Chap 01 2024 47e Comprehensive
Indicate whether the statement is true or false.
1. A CPA firm in California sends many of its less complex tax returns to be prepared by a group of accountants in
India. If certain procedures are followed, this outsourcing of tax return preparation is proper.
a. True
b. False
2. On transfers by death, the Federal government relies on an estate tax, while states may impose an estate tax, an
inheritance tax, both taxes, or neither tax.
a. True
b. False
3. Stealth taxes have the effect of generating additional taxes from all taxpayers.
a. True
b. False
4. Sales made over the internet are not exempt from the application of a general sales (or use) tax.
a. True
b. False
5. Various tax provisions encourage the creation of certain types of retirement plans. Such provisions can be
justified on both economic and social grounds.
a. True
b. False
6. A safe and easy way for a taxpayer to avoid local and state sales taxes is to make the purchase in a state that
levies no such taxes.
a. True
b. False
7. To lessen or eliminate the effect of multiple taxation, a taxpayer who is subject to both foreign and U.S. income
taxes on the same income is allowed either a deduction or a credit for the foreign tax paid.
a. True
b. False
8. In preparing a tax return, all questions on the return must be answered.
a. True
b. False
9. In preparing an income tax return, the use of a client’s estimates is not permitted.
a. True
b. False
. Page 1
, Name: Class: Date:
Chap 01 2024 47e Comprehensive
10. A calendar year taxpayer files his 2022 Federal income tax return on March 4, 2023. The return reflects an
overpayment of $6,000, and the taxpayer requests a refund of this amount. The refund is paid on May 16, 2023.
The refund need not include interest.
a. True
b. False
11. The amount of a taxpayer’s itemized deductions will increase the chance of being audited by the IRS.
a. True
b. False
12. Currently, the Federal corporate income tax is less progressive than the individual income tax.
a. True
b. False
13. Even though a client refuses to correct an error on a past return, it may be possible for a practitioner to continue
to prepare returns for the client.
a. True
b. False
14. When interest is charged on a deficiency, any part of a month counts as a full month.
a. True
b. False
15. Upon audit by the IRS, Faith is assessed a deficiency of $40,000 of which $25,000 is attributable to negligence.
The 20% negligence penalty will apply to $25,000.
a. True
b. False
16. There is a Federal excise tax on hotel occupancy.
a. True
b. False
17. The IRS is required to redetermine the interest rate on underpayments and overpayments once a year.
a. True
b. False
18. For state income tax purposes, some states allow a credit for dependents rather than a deduction.
a. True
b. False
19. Julius, a married taxpayer, makes gifts to each of his six children. A maximum of twelve annual exclusions could
be allowed as to these gifts.
a. True
b. False
. Page 2
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