Principles Of Taxation For Business And Investment Planning 2020 Edition
23rd Edition
ISBN: 9781259969546
Author: Sally Jones, Shelley C. Rhoades-Catanach, Sandra R Callaghan
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Question
Chapter 18, Problem 15AP
a.
To determine
Determine Ms. H’s penalty for negligence in preparing tax return.
b.
To determine
Determine Ms. H’s penalty for cheating the government through underpayment of tax.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Juan inquired from the BIR whether or not he will be covered with the new tax law. The BIR issued an administrative ruling that his activities are not covered by the new tax law. As a result, Juan did not pay his tax for several years based on the said BIR ruling. Currently, the BIR Commissioner found out that the previous ruling was erroneous and reversed the same with a new BIR ruling. The BIR then issued tax assessment against Juan for purposes of collecting back taxes.Is the tax assessment against Juan correct?
A. Yes, because the previous BIR ruling was corrected and the activities of Juan should have been taxable.
B. Yes, because the ruling of the BIR Commissioner must be final.
C. No, Juan should be exempted from paying taxes under the old and new law.
D. No, because reversal of BIR ruling shall not be retroactive in application especially if the ruling is prejudicial to the taxpayer
Andrea's 2020 return was audited by the IRS. Andrea failed to report taxable interest income on her return, which resulted in an assessment of $8,000 in tax. Assuming her actions were intentional and fraudulent, what is her accuracy penalty?
Neville's 2020 return was audited by the IRS and was assessed $18,000 in tax. Assuming his actions were negligent, not fraudulent, what is his accuracy penalty?
Chapter 18 Solutions
Principles Of Taxation For Business And Investment Planning 2020 Edition
Ch. 18 - Prob. 1QPDCh. 18 - Prob. 2QPDCh. 18 - Prob. 3QPDCh. 18 - Prob. 4QPDCh. 18 - Prob. 5QPDCh. 18 - Prob. 6QPDCh. 18 - Prob. 7QPDCh. 18 - Prob. 8QPDCh. 18 - Prob. 9QPDCh. 18 - Prob. 10QPD
Ch. 18 - Prob. 11QPDCh. 18 - Prob. 12QPDCh. 18 - Prob. 13QPDCh. 18 - Prob. 14QPDCh. 18 - Prob. 1APCh. 18 - Prob. 2APCh. 18 - Prob. 3APCh. 18 - Prob. 4APCh. 18 - Prob. 5APCh. 18 - Prob. 6APCh. 18 - Prob. 7APCh. 18 - Prob. 8APCh. 18 - Prob. 9APCh. 18 - Prob. 10APCh. 18 - Prob. 11APCh. 18 - Prob. 12APCh. 18 - A revenue agent determined that Ms. Owen underpaid...Ch. 18 - Prob. 14APCh. 18 - Prob. 15APCh. 18 - Prob. 16APCh. 18 - Prob. 17APCh. 18 - Prob. 18APCh. 18 - Prob. 19APCh. 18 - Prob. 20APCh. 18 - Prob. 22APCh. 18 - Prob. 8IRPCh. 18 - Prob. 9IRPCh. 18 - Prob. 1RPCh. 18 - Prob. 2RPCh. 18 - Prob. 1TPCCh. 18 - Prob. 2TPC
Knowledge Booster
Similar questions
- During a recent IRS audit, the revenue agent decided that the Parker family used their closely held corporation, Falco, to avoid shareholder tax by accumulating earnings beyond the reasonable needs of the business. Falco’s taxable income was $1,010,000, it paid no dividends, and it had no business need to retain income. Falco’s marginal tax rate in prior years was 34 percent. Required: Compute Falco’s accumulated earnings tax assuming that it had accumulated $5 million after-tax income in prior years. Compute Falco’s accumulated earnings tax assuming that it had accumulated $141,000 after-tax income in prior years.arrow_forward. Jack filed his tax return 8 months and 27 days late and did not request an extension of time for filing. Jack's return indicated that he is to receive a $9,695 refund in taxes. Calculate the amount of Jack's penalty for failure to file his tax return on time, assuming the failure-to-file was not fraudulent.$arrow_forwardDuring a recent IRS audit, the revenue agent decided that the Parker family used their closely held corporation, Falco, to avoid shareholder tax by accumulating earnings beyond the reasonable needs of the business. Falco’s taxable income was $880,000, it paid no dividends, and it had no business need to retain income. Falco's marginal tax rate in prior years was 34 percent. Assume the accumulated earnings tax rate is 20% for all applicable years in this problem. Required: Compute Falco’s accumulated earnings tax assuming that it had accumulated $4 million after-tax income in prior years. Assume that for these years at issue, a corporation is exempt up to $250,000 of accumulated earnings without demonstrating a reasonable business need for the accumulation. Compute Falco’s accumulated earnings tax assuming that it had accumulated $128,000 after-tax income in prior years. Assume that for these years at issue, a corporation is exempt up to $250,000 of accumulated earnings without…arrow_forward
- For tax year 2019, the IRS assesses a deficiency against David for $500,000. a. Disregarding the interest component, enter David's penalty if the deficiency is attributable to negligence: $fill in the blank 00862dfde01c05d_1. b. Disregarding the interest component, enter David's penalty if the deficiency is attributable to civil fraud: $fill in the blank c83f71023f93fbc_1.arrow_forwardMs. Schmidt didn't request an extension of time to file a 2022 income tax return and didn't mail the completed return to the IRS until August 8, 2023. Ms. Schmidt enclosed a check for $2,610, the correct balance of tax due with the return. Required: a. Assuming that Ms. Schmidt can't show reasonable cause for filing a delinquent return, compute the late-filing and late-payment penalty. b. Compute the late-filing and late-payment penalty if the return was not mailed until November 21. Complete this question by entering your answers in the tabs below. Required A Required B Assuming that Ms. Schmidt can't show reasonable cause for filing a delinquent return, compute the late-filing and late- payment penalty. Late-filing and late-payment penalty < Required A Required Barrow_forwardAnswer the following: a. Geoffrey filed his tax return 2 months and 8 days late and had not requested an extension of time for filing. Geoffrey's return indicated that he is to receive a $600 refund in taxes. Calculate the amount of Geoffrey's penalty for failure to file his tax return on time, assuming the failure to file was not fraudulent. b. John filed his individual income tax return 3½months after it was due. He had not requested an extension of time for filing. Along with his return, John remitted a check for $1,000, which was the balance of the taxes he owed with his return. Disregarding interest, calculate the total penalty that John will be required to pay, assuming the failure to file was not fraudulent (and that he is not subject to failure-to-pay penalties).arrow_forward
- Joan filed her individual income tax return 4½ months after it was due. She did not request an extension of time for filing. Along with her return, Joan remitted a check for $750, which was the balance of the taxes she owed with her return. Disregarding interest, calculate the total penalties that Joan will be required to pay, assuming the failure to file was not fraudulent.arrow_forwardFive years ago, as the result of an examination of your client, Pachenko, the IRS assessed a $5000 tax liability, which remains unpaid. Which section and subsection of the internal revenue code defines the length of the period after assessment during which the IRD has to begin court proceedings to collect taxes? Enter your response in the answer field below IRS$arrow_forwardMs. Schmidt didn't request an extension of time to file a 2021 income tax return and didn't mail the completed return to the IRS until August 8, 2022. Ms. Schmidt enclosed a check for $3,490, the correct balance of tax due with the return. Required: a. Assuming that Ms. Schmidt can't show reasonable cause for filing a delinquent return, compute the late-filing and late-payment penalty. b. Compute the late-filing and late-payment penalty if the return was not mailed until November 21. X Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Compute the late-filing and late-payment penalty if the return was not mailed until November 21. Note: Round your intermediate and final calculations to the nearest whole dollar amount. Late-filing and late-payment penalty $ 698 x < Required A Required Barrow_forward
- Klawz received a 1099-DIV from Nike Corporation for $1,000 and a 1099-INT from his Bank of $500. If Klawz's neglects to enter the 1099-DIV on his US Income Tax Return (Form 1040), which audit program likely adjusted Klawz's tax return? Document perfection. None of the choices are correct. Deduction Detective. Information matching. DIF system.arrow_forwardJohn Taylor, a tax consultant, charges his clients a fee based on the percentage of the tax he saves a client. John received a payment from a client, but he realised that Angela didn’t declare income. Therefore, the income tax return that John’s prepared understated income tax liability.Taking into consideration the Accounting Professional Code of Conduct explain the Tax Penalties and actions John should take following his discovery.arrow_forwardJoan filed her individual income tax return 4% months after it was due. She did not request an extension of time for filing. Along with her return, Joan remitted a check for $750, which was the balance of the taxes she owed with her return. Disregarding interest, calculate the total penalties that Joan will be required to pay, assuming the failure to file was not fraudulent. 187.50 and 168.75 are incorrect. Please help me with this problem!arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT