Which Statement Is INCORRECT Regarding Proposed Regulations

question 39

Multiple Choice

Which statement is INCORRECT regarding Proposed Regulations?

• A)They donot have the same effect as law.
• B)Proposed Regulations are useful for understanding the IRS's current position on an issue but generally should not be relied on by a taxpayer unless the IRS provides explicit advice on doing so.
• C)Proposed Regulations carry the same authority as Final Regulations.
• D)None of these are correct.

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Definitions:

Privity

A legal concept indicating a close, mutual, or successive relationship to the same right of property or the power to enforce a promise or warranty.

Due Diligence

The investigation or exercise of care that a reasonable business or person is normally expected to take before entering into an agreement or contract.

Accountant-Client Privilege

A legal principle that protects communications between a certified accountant and their client from being disclosed without the client's permission.

Statutorily Recognize

Formally acknowledged or established by law or statute.