Which of the following scenarios would most likely result in the assessment of a penalty for failure to sign a tax return under IRC §6695?

Answer options:

A paid preparer with primary responsibility for the overall accuracy of the return fails to sign the return.

A preparer who only provided advice on a specific legal issue but did not prepare the schedule fails to sign.

An employee who prepares a return for their employer fails to sign the return.

A volunteer preparing a return for a VITA clinic fails to sign.

How to approach this question

Identify who qualifies as a 'tax return preparer' required to sign: a paid individual with primary responsibility.

Full Answer

A.A paid preparer with primary responsibility for the overall accuracy of the return fails to sign the return.✓ Correct

IRC §6695(b) imposes a penalty on a tax return preparer who is required to sign a return but fails to do so. This applies to the individual with primary responsibility for the overall accuracy of the return.

Common mistakes

Thinking employees preparing returns for their company are subject to preparer penalties.

Question 03 All questions Question 05

Practice the full CPA REG Practice Exam 3

72 questions · hints · full answers · grading

More questions from this exam

Q01A CPA is preparing an original tax return for a client who is claiming a refund based on a positi...Hard Q02A practitioner is representing a taxpayer in an IRS examination. The taxpayer has a 25% ownership...Hard Q03A tax return preparer willfully attempts to understate the tax liability on a client's return by ...Hard Q05Regarding the disciplinary authority of State Boards of Accountancy, which of the following state...Hard Q06A taxpayer filed their Year 1 tax return on March 15, Year 2. The return omitted $6,000 of gross ...Hard

View all 72 questions →