According to Statement on Standards for Tax Services No

question 81

Multiple Choice

According to Statement on Standards for Tax Services No. 1, a tax practitioner can recommend a tax return position:

• A) if the position is frivolous and disclosed on the tax return.
• B) if the position complies with the standards imposed by the applicable tax authority.
• C) only if the position meets the "more likely than not" standard.
• D) only if the position meets the "clear and convincing evidence" standard.
• E) None of these.

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Definitions:

Mutual Benefit

Refers to actions or policies that provide advantages or positive outcomes to all involved parties.

Reasonable Care

The standard of care that a reasonably prudent person would use in a similar situation to avoid harm to others.

Sole Benefit

Pertains to actions or provisions designed to favor a single person or entity exclusively.

Bailee

A person or entity who is given temporary possession but not ownership of a property or goods for a specific purpose.