SWFT Individual Income Taxes
43rd Edition
ISBN: 9780357391365
Author: YOUNG
Publisher: Cengage
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Tax preparers often have a difference of opinion with their clients as to how some transactions should be treated on a tax return. If a client of yours does not wish to report information on their tax return that you feel should be reported, how would you handle the situation? Write in at least 300 words with two scholarly sources.
You are assisting a client with a transaction that produces a most favorable tax result. The client told
you the outcome is dependent on one court case. What should you do?
a. Nothing. Your due diligence obligations allow you to rely in good faith on information furnished to
you by the client; you are permitted to rely on the client's judgment.
6. Check with the client's auditor to ensure the numbers are valid; then you can recalculate intended
tax benefits.
c. Help the client by getting a head start on the tax return presentation of the transaction; the better the
presentation, the less likely it will be audited by the IRS.
d. Analyze the case to make sure the holding has not been reversed, the client's facts are similar to
those described in the case, and the law cited in the case is still valid.
John Taylor, a tax consultant, charges his clients a fee based on the percentage of the tax he saves a client. John received a payment from a client, but he realised that Angela didn’t declare income. Therefore, the income tax return that John’s prepared understated income tax liability.Taking into consideration the Accounting Professional Code of Conduct explain the Tax Penalties and actions John should take following his discovery.
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- According to the AICPA's Statements on Standards for Tax Services, what duties does the tax practitioner owe the client? (If an input field is not used leave the input field(s) empty.) not to disclose tax-related errors without the client's consent. to inform the client of corrective measures to be taken. C to inform the client of errors in a previously filed tax return. to inform the client of how the client can avoid a penalty through disclosure. to inform the client of the potential adverse consequences of a tax return position. to inquire of the client when information provided by him or her appears incorrect, incomplete, or inconsistent on its face. to inquire of the client when the client must satisfy conditions to take a deduction. to instruct the client to file an extension based on refunds that are expected. to instruct the client whether or not to file a tax return.arrow_forwardYou are in the tax department at a large public accounting firm and you are working with your new client, Big Corporation. Big Corporation prepares their financial statements (Book Income) based on US Generally Accepted Accounting Principles (GAAP). The Controller is very familiar with GAAP accounting but is unsure about this need to adjust Book Income to Taxable Income and wants to understand it better. You have already identified five questions that the Controller has concerning these Book to Tax Differences from your first meeting. You are planning to meet again with the Controller to discuss those listed five items identified below, Items 1 to 5. For that upcoming meeting, please write in a paragraph or so for each item (i.e. 1, 2, 3, 4 and 5) so you can be prepared to verbally discuss with the Controller each item. There is no need for any references to tax law and do not worry about grammar or spelling since this will be your notes only for the upcoming discussion and the…arrow_forwardYou are in the tax department at a large public accounting firm and you are working with your new client, Big Corporation. Big Corporation prepares their financial statements (Book Income) based on US Generally Accepted Accounting Principles (GAAP). The Controller is very familiar with GAAP accounting but is unsure about this need to adjust Book Income to Taxable Income and wants to understand it better. You have already identified five questions that the Controller has concerning these Book to Tax Differences from your first meeting. You are planning to meet again with the Controller to discuss those listed five items identified below, Items 1 to 5. For that upcoming meeting, please write in a paragraph or so for each item (i.e. 1, 2, 3, 4 and 5) so you can be prepared to verbally discuss with the Controller each item. There is no need for any references to tax law and do not worry about grammar or spelling since this will be your notes only for the upcoming discussion and the…arrow_forward
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- Individual tax filing requirements and circumstances can change, so it is important to be familiar with the research tools available to you as a tax practitioner. In this discussion, you will consider research resources available for tax preparers and how they can be used in the field. What are the available commercial and noncommercial tax resources that you could utilize as a tax practitioner? Refer to Section 2-2A through 2-2C (specifically, exhibit 2-7) in your textbook for options. Which commercial resource do you think is the most beneficial to a tax practitioner? (Note that you will not be able to access the commercial resources but can find their features on their website.) Which noncommercial resource do you think is the most beneficial to a tax practitioner? How might you use the tax research process (refer to Section 2-3 in your textbook) for utilizing tax resources in preparing individual tax returns. (Think about ways you could use this process to support you in…arrow_forwardWhich of the following are not deductible by a CPA who prepares tax returns? a. Subscription to the Kiplinger Tax letter b. Subscription to CCH service online c.Dues to the country club to entertain clients d. Dues to the California Society of CPAsarrow_forwardYou and Sunny are arguing whether tax laws can be retroactive in its application. Sunny noted that they can only be prospective but you take the stand that it may retroactive. 1. Which of the following would be the least fit example you could give? A. tax laws implementing riles and regulations that are remedial in nature B. tax memoranda that are interpretative in nature C. tax laws imposing business tax D. tax circulars that are intended for internal purposes of BIRarrow_forward
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