taxpayer has no obligation to pay more taxes than are legally owed, and a [CPA] has a duty to the taxpayer to assist in achieving that result.” – SSTS No. 1, ¶ 11. This statement comports with what CPAs more commonly say, which is that tax avoidance is perfectly fine while it’s tax evasion that’s criminal. As a future CPA (or business / financial professional), do you agree with this philosophy? Why or why not?

taxpayer has no obligation to pay more taxes than are legally owed, and a [CPA] has a duty to the taxpayer to assist in achieving that result.” – SSTS No. 1, ¶ 11. This statement comports with what CPAs more commonly say, which is that tax avoidance is perfectly fine while it’s tax evasion that’s criminal. As a future CPA (or business / financial professional), do you agree with this philosophy? Why or why not?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter17: Tax Practice And Ethics

Section: Chapter Questions

Problem 13DQ

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Similar questions

Distinguish between tax avoidance and tax evasion. What are the ethical responsibilities of the tax practitioner in dealing with tax avoidance? What are the ethical responsibilities of the tax practitioner in dealing with tax evasion?
You and Jackie are arguing whether tax laws can be retroactive in its application. Jackie noted that they can only be prospective but you take the stand that it may retroactive. Which of the following would be the least fit example you could give? A. tax laws imposing business tax B. tax laws implementing riles and regulations that are remedial in nature C. tax circulars that are intended for internal purposes of BIR D. tax memoranda that are interpretative in nature
You are assisting a client with a transaction that produces a most favorable tax result. The client told you the outcome is dependent on one court case. What should you do? a. Nothing. Your due diligence obligations allow you to rely in good faith on information furnished to you by the client; you are permitted to rely on the client's judgment. 6. Check with the client's auditor to ensure the numbers are valid; then you can recalculate intended tax benefits. c. Help the client by getting a head start on the tax return presentation of the transaction; the better the presentation, the less likely it will be audited by the IRS. d. Analyze the case to make sure the holding has not been reversed, the client's facts are similar to those described in the case, and the law cited in the case is still valid.
Which of the following is a correct statement? O Tax avoidance includes failure to pay tax on unreported income from legal sources The IRS estimates that more income tax is lost from evasion involving illegal activities than from unreported legal activities, O Tax avoidance is legal O Tax evasion includes the application of legal loophole to reduce tax liability
Indicate whether the following statements are "True" or "False" regarding letter rulings. a. Letter rulings have the force and effect of law and provide guidance and support for taxpayers in similar transactions. b. A letter ruling represents the current opinion of the IRS on the tax consequences of a transaction with a given set of facts. c. Letter rulings not only help promote a uniform application of the tax laws but also may reduce the potential for litigation or disputes with IRS agent
Explain the importance of IRS Code Sections 162(a)(1) and 162(a)(2). A taxpayer has a tax issue in which the only authorities are a private letter ruling that favors the taxpayer's position and a Tax Court decision that opposes the taxpayer's position. What advice would you provide the taxpayer?
Which of the following is TRUE? When the tax law is vague or ambiguous, it is to be interpreted liberally in favor of the taxing authority When the tax law is vague or ambiguous, it is to be interpreted strictly against the taxpayer When the tax law is clear, it requires no interpretation As to exemption, the provision is to be interpreted liberally in favor of the taxpayer As to exemption, the provision is to be interpreted strictly against the favor of the taxing authority
Do the tax agent need to have a professional scepticism? Or just professional judgement is enough
1.(True/False) Cases and rulings contrast in that cases represent a binding resolution to disagreements between the IRS and the taxpayer while rulings only provide guidance to the public.
If civil tax fraud pursuant to IRC § 6663 is asserted by the IRS, the burden of proof falls upon the IRS by what standard? Select one: a. beyond reasonable doubt b. clear and convincing c. preponderance of evidence d. the taxpayer because the IRS.
1. If there is a conflict between a BIR Ruling and a Revenue Memorandum Ruling, which will prevail? 2.Which tax system impacts more on the rich people, and why does it impacts them more?
Which of the following statements NOT correct? a. If a taxpayer is not in agreement with the decision of the Tax Appeals Authority, there is no further action that the taxpayer can take. b. Where a taxpayer loss an appeal, the taxpayer is required to pay interest on the unpaid tax from the payment date statement on the Decision Notice. c. Tax planning within the confines of the tax laws is not illegal. d. Effective tax management may result in significant cost savings.