Before Recommending a Tax Position That Meets the "Substantial Authority

question 10

Multiple Choice

Before recommending a tax position that meets the "substantial authority" standard,a tax return preparer should make sure that:

• A) The taxpayer adequately understands the potential penalties associated with claiming a tax position that satisfies this reporting standard
• B) The tax law does not impose a higher reporting standard on the particular transaction or matter at issue
• C) A list of the authorities that support this position is attached to the taxpayer's tax return
• D) The taxpayer adequately discloses to the IRS a minimum of one "recognized contrary authority" that fails to support the taxpayer's asserted position

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Definitions:

Insurance

A financial product providing protection against potential future losses or damages.

Management Development Programs

Structured training and educational initiatives designed to enhance the leadership skills of managers.

Cost Formula

An equation or method used to determine the total cost of production or service provision, typically including fixed and variable components.

Activity Level

The degree of operational output or workload that can significantly affect a company’s performance and cost structure.