In Selecting Returns for Examination, the Primary Goal of the IRS

question 30

Multiple Choice

In selecting returns for examination, the primary goal of the IRS is to review only those returns that:

• A) belong to the taxpayers who were found guilty before.
• B) will generate additional revenues for the Treasury
• C) have been filed for the first time.
• D) contain mathematical/clerical errors.

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Definitions:

Individuals

Refers to single human beings, considered separately from their societal or familial roles or status.

Capital Contributions

Financial or other assets provided by owners or investors to a company, increasing its equity.

Capital Balance

The amount of funds contributed by owners or partners to a business, plus any retained earnings or subtracted losses, constituting the equity portion of the balance sheet.

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenue.