Mr Braco Is an Enrolled Agent Who Prepares Tax Returns

question 68

Multiple Choice

Mr. Braco is an enrolled agent who prepares tax returns for a living. In preparing Mr. and Mrs. Colter's Form 1040, Mr. Braco claimed a deduction based on an unreasonable legal position. Mr. Braco's compensation for the return was $3,800. What is the consequence to Mr. Braco if the IRS disallows the deduction?

• A) The IRS can terminate Mr. Braco's status as an enrolled agent.
• B) The IRS can impose a $1,900 penalty on Mr. Braco.
• C) The IRS can impose a negligence penalty on the Colters but can't penalize Mr. Braco.
• D) The IRS can impose a civil fraud penalty on Mr. Braco.

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Definitions:

Interpersonal Relations

The interaction and communication that occur between individuals within various contexts, influencing social bonding and dynamics.

Decision Making

The cognitive process of selecting a course of action from multiple alternatives.

Work Teams

Groups of employees who collaborate and share responsibilities to achieve common goals and deliver project outcomes.

Collective Work

Efforts undertaken by a group of individuals working together towards a common goal or project.