If a Return Is Identified as Including an Unallowable Item

question 46

Multiple Choice

If a return is identified as including an unallowable item, the IRS:

• A) Computes the seemingly necessary adjustment in taxes, and the taxpayer is notified by mail.
• B) Sends a formal notice of deficiency to the taxpayer.
• C) Considers the contact that it makes with a taxpayer under this circumstance to be an examination.
• D) Cancels the return and asks the taxpayer to file his return again.

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Definitions:

Pay Sales Taxes Icon

A software interface element that allows users to manage and remit the sales taxes collected from customers.

Sales Taxes

Taxes imposed by the government on sales of goods and services, which are typically paid by the consumer at the point of sale.

Payroll Liabilities

Obligations arising from salaries, wages, taxes, and other amounts due to employees.

Federal Income Taxes

Taxes levied by the Internal Revenue Service (IRS) on the annual earnings of individuals, corporations, trusts, and other legal entities.