Part 3 Exam 4 | Med School Hub

EA Full Length Practice Test Part III – Exam 4

This is an EA full-length practice exam designed to replicate real test conditions as closely as possible.

📘 Exam Instructions

Before You Begin

Time Limit: 210 minutes (Timer will start when you click ‘Start’)
Format: 100 multiple-choice questions
Environment: Choose a quiet space with no distractions
No Resources: Close books, notes, and this guide
Answer Every Question: Even if unsure, make your best guess
Simulate Real Conditions:
- No phone
- No interruptions
- No unnecessary breaks

🧠 When You Start

Start the timer and begin with Question 1
Work steadily — do not spend too much time on one question
If a question is too difficult, skip it and return later if time allows
Stay focused and maintain a consistent pace

⏱️ After Completion

Stop immediately at 210 minutes, even if you are not finished
Do not check answers during the test
Review your answers only after completing the entire exam

1 / 96

Tags: Tax Law, Circular 230, IRS Procedures

A. A practitioner is providing “Reliance Opinion” advice. Under the modified standards of Circular 230, which of the following is true regarding the “Financial Interest” disclosure?

A. The practitioner must disclose any compensation arrangement with a promoter.

B. No disclosure is required if the fee is less than $5,000.

C. Disclosure is only required if the practitioner is also a licensed attorney.

D. The disclosure must be placed on the first page of the written advice.

2 / 96

Tags: Tax Law, Circular 230, IRS Procedures

B. In a “John Doe” Summons (Section 7609(f)), the IRS is not required to identify the taxpayer by name. To serve this summons, the IRS must first:

A. Obtain approval from the National Taxpayer Advocate.

B. Establish in a court proceeding that the summons relates to an ascertainable group.

C. Issue a 30-day letter to the primary suspect.

D. Wait for the statute of limitations to expire on the unknown taxpayers.

3 / 96

Tags: Tax Law, Circular 230, IRS Procedures

C. If a practitioner is “Censured” and the OPR imposes a “Monetary Penalty,” what is the maximum amount that can be assessed against an individual practitioner?

A. 100% of the gross income derived from the engagement.

B. $10,000 per violation.

C. 50% of the practitioner's prior year total tax liability.

D. A flat fee of $50,000.

4 / 96

Tags: Tax Law, Circular 230, IRS Procedures

D. A taxpayer files a “Request for an Equivalent Hearing” because they missed the 30-day window for a CDP. Which of the following is true?

A. The taxpayer can appeal the decision to the U.S. District Court but not the Tax Court.

B. The hearing is conducted by a Revenue Officer instead of an Appeals Officer.

C. The results of the hearing are not subject to judicial review.

D. The 10-year collection statute (CSED) is suspended during the hearing.

5 / 96

Tags: Tax Law, Circular 230, IRS Procedures

E. Under Circular 230 §10.35, “Competence” requires the knowledge, skill, thoroughness, and preparation necessary for the matter. If a practitioner lacks the necessary competence, they may still handle the matter if they:

A. Charge a lower fee to reflect their lack of experience.

B. Have at least 10 years of general tax experience.

C. Disclose the lack of competence to the OPR in writing.

D. Associate with another practitioner who is competent in that field.

6 / 96

Tags: Tax Law, Circular 230, IRS Procedures

F. A “Notice of Jeopardy Assessment” must be provided to the taxpayer within 5 days. What is the taxpayer’s first administrative remedy to challenge the “Reasonableness” of the jeopardy?

A. File a petition in Tax Court within 90 days.

B. File a suit for refund in the U.S. Court of Federal Claims.

C. Request an administrative review by the IRS Appeals Office.

D. Submit an Offer in Compromise based on Doubt as to Liability.

7 / 96

Tags: Tax Law, Circular 230, IRS Procedures

G. Which of the following is a “Nonsigning Preparer” for purposes of the Section 6694 penalty?

A. A person who gives advice on a specific issue that constitutes a substantial portion of the return.

B. An employee who provides purely mechanical or clerical assistance.

C. A person who prepares a return for an aunt for no compensation.

D. The owner of a tax firm who does not review any returns.

8 / 96

Tags: Tax Law, Circular 230, IRS Procedures

H. An Enrolled Agent is representing a client in a case involving “Criminal Fraud.” The IRS Special Agent asks the EA for workpapers. The EA should know that:

A. The Section 7525 privilege applies to all workpapers.

B. No privilege exists for communications related to criminal matters.

C. Only the "Kovel" doctrine can protect the workpapers if an attorney is involved.

D. Both B and C.

9 / 96

Tags: Tax Law, Circular 230, IRS Procedures

I. The “Trust Fund Recovery Penalty” (TFRP) is 100% of the unpaid trust fund taxes. If multiple “Responsible Persons” are assessed, the IRS:

A. Can collect the full amount from any one person, but the government can only keep 100% total.

B. Divides the penalty equally among all responsible persons.

C. Must collect from the person with the highest salary first.

D. Waives the penalty if the corporation files for Chapter 7 bankruptcy.

10 / 96

Tags: Tax Law, Circular 230, IRS Procedures

J. A “Statutory Notice of Deficiency” was mailed to a taxpayer’s “Last Known Address,” but the taxpayer had moved and never received it. The 90-day period expires. What is the result?

A. The assessment is invalid because the taxpayer lacked "Actual Notice."

B. The taxpayer can file an "Automatic Appeal" to the Supreme Court.

C. The assessment is valid because the IRS fulfilled its duty by mailing to the last known address.

D. The IRS must re-mail the notice and start the 90-day clock over.

11 / 96

Tags: Tax Law, Circular 230, IRS Procedures

K. “Form 8275-R” (Regulation Disclosure Statement) is used to disclose positions that are contrary to:

A. A Treasury Regulation.

B. A Revenue Ruling.

C. An IRS News Release.

D. A Private Letter Ruling issued to a different taxpayer.

12 / 96

Tags: Tax Law, Circular 230, IRS Procedures

L. A “Notice of Federal Tax Lien” (NFTL) has been filed. The taxpayer wants a “Withdrawal” of the NFTL (as if it were never filed). This is possible if:

A. The tax was paid in full 5 years ago.

B. The taxpayer enters into a Direct Debit Installment Agreement (meeting certain criteria).

C. The taxpayer is over the age of 65.

D. The NFTL makes it difficult for the taxpayer to get a job.

13 / 96

Tags: Tax Law, Circular 230, IRS Procedures

M. In a “Small Tax Case” (S-Case) in Tax Court, the amount of tax in dispute for any one tax year must not exceed:

A. $10,000.

B. $25,000.

C. $50,000.

D. $100,000.

14 / 96

Tags: Tax Law, Circular 230, IRS Procedures

N. If a practitioner is “Permanently Enjoined” by a court from acting as a tax return preparer, the OPR’s “Expedited Suspension” process:

A. Requires a full hearing before an Administrative Law Judge.

B. Takes exactly one year to finalize.

C. Is only available if the practitioner was convicted of a felony.

D. Allows the practitioner 30 days to show cause why they should not be suspended.

15 / 96

Tags: Tax Law, Circular 230, IRS Procedures

O. “Form 14039” is used by a practitioner or taxpayer specifically for:

A. Reporting a change in accounting method.

B. Reporting identity theft involving a tax return.

C. Applying for a hardship waiver for e-filing.

D. Requesting an extension for an estate tax return.

16 / 96

Tags: Tax Law, Circular 230, IRS Procedures

P. A practitioner has a “Lien” on client records under state law for unpaid fees. Under Circular 230, the practitioner:

A. Must return all records regardless of state law.

B. May retain all records until the fee is paid in full.

C. Must return "Client Records" needed for the client to comply with their federal tax obligations.

D. Can only retain records if the client is a corporation.

17 / 96

Tags: Tax Law, Circular 230, IRS Procedures

Q. The “Golsen Rule” applies to which court?

A. U.S. District Court.

B. U.S. Court of Federal Claims.

C. U.S. Tax Court.

D. U.S. Bankruptcy Court.

18 / 96

Tags: Tax Law, Circular 230, IRS Procedures

R. Which “Form” is used to apply for a “Centralized Authorization File” (CAF) number if the practitioner doesn’t already have one?

A. Form 23.

B. Form 2848.

C. Form 8821.

D. Either B or C (when first submitted).

19 / 96

Tags: Tax Law, Circular 230, IRS Procedures

S. A “Qualified Appraiser” may be disqualified from providing appraisals for the IRS for a period of up to:

A. 1 year.

B. 3 years.

C. 5 years.

D. Permanently.

20 / 96

Tags: Tax Law, Circular 230, IRS Procedures

T. Under the “Anti-Injunction Act,” a court can stop a tax collection if the taxpayer proves the government cannot possibly win and:

A. The taxpayer will suffer "Irreparable Harm" without the injunction.

B. The taxpayer is an Enrolled Agent.

C. The amount of tax is less than $100.

D. The IRS agent was rude.

21 / 96

Tags: Tax Law, Circular 230, IRS Procedures

U. “Form 9465” (Installment Agreement Request) can be used to request an IA for a liability up to what amount without providing a full financial statement (under simplified rules)?

A. $10,000.

B. $25,000.

C. $50,000.

D. $100,000.

22 / 96

Tags: Tax Law, Circular 230, IRS Procedures

V. Which of the following “Practitioners” is NOT subject to the CPE requirements of Circular 230?

A. Enrolled Agents.

B. Enrolled Retirement Plan Agents.

C. Attorneys and CPAs (who are governed by their state boards).

D. Enrolled Actuaries.

23 / 96

Tags: Tax Law, Circular 230, IRS Procedures

W. The IRS “Office of Appeals” is considered “Independent” because:

A. Appeals Officers are not allowed to have "ex parte" (one-sided) communications with the originating IRS function.

B. It reports directly to the U.S. Supreme Court.

C. They can ignore the Internal Revenue Code if they feel it is unfair.

D. Their salaries are paid by the Taxpayer Advocate Service.

24 / 96

Tags: Tax Law, Circular 230, IRS Procedures

X. A practitioner is required to “verify” the information provided by a client:

A. In every single engagement, regardless of context.

B. Only if the tax return results in a refund of over $10,000.

C. Only if the client has a prior history of fraud.

D. Only if the information appears to be incorrect, inconsistent, or incomplete.

25 / 96

Tags: Tax Law, Circular 230, IRS Procedures

Y. If a practitioner is served with a complaint by the OPR, they must file an “Answer” under oath. If the practitioner fails to file an answer within the prescribed 30-day period:

A. The OPR must file a motion for summary judgment in U.S. District Court.

B. The case is dismissed, but the practitioner’s PTIN is suspended for one year.

C. The practitioner is granted an automatic 60-day extension.

D. The Administrative Law Judge (ALJ) may enter a decision by default against the practitioner.

26 / 96

Tags: Tax Law, Circular 230, IRS Procedures

Z. An “Authorized e-file Provider” is prohibited from using which of the following in their advertising or marketing materials?

A. A statement that the IRS "endorses" or "approves" the provider's specific services.

B. The IRS "e-file" logo.

C. The practitioner’s Enrolled Agent designation.

D. A link to the official IRS.gov website.

27 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AA. Which “Form” is used to report a “Gift” from a foreign person or a distribution from a foreign trust that exceeds $100,000?

A. Form 1040, Schedule B.

B. Form 3520.

C. Form 8938.

D. FinCEN Form 114.

28 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AB. A “Notice of Determination” is issued in a CDP case. If the taxpayer petitions the Tax Court and the Tax Court finds the IRS’s position was “frivolous,” the court can impose a penalty of up to:

A. $5,000.

B. $10,000.

C. $25,000.

D. $50,000.

29 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AC. Under Circular 230 §10.37, “Written Advice” includes which of the following?

A. Emails and text messages regarding tax matters.

B. Posts on a practitioner's social media blog.

C. A standard "disclaimer" at the bottom of every email.

D. Only formal, bound legal opinions.

30 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AD. The IRS may “Bypass” a practitioner and contact the taxpayer directly if:

A. The practitioner fails to respond to repeated requests for information within a reasonable time.

B. The Revenue Agent finds the practitioner's personality annoying.

C. The taxpayer owes more than $50,000.

D. The taxpayer has not signed a Form 2848.

31 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AE. A “Qualified Offer” must be open for acceptance by the IRS for at least how many days?

A. 15 days.

B. 30 days.

C. 90 days.

D. Until the date the case is called for trial.

32 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AF. If a practitioner is “Suspended” for “Expedited” reasons (e.g., a felony conviction), the suspension begins:

A. 30 days after the date the notice of suspension is mailed.

B. Immediately upon the date the felony is committed.

C. Only after the practitioner exhausts all appeals in the criminal case.

D. On the first day of the next calendar year.

33 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AG. A “Collateral Attack” on an assessment is generally not allowed in a CDP hearing. However, a taxpayer CAN challenge the underlying tax liability if:

A. They did not receive a Statutory Notice of Deficiency.

B. They did not otherwise have an opportunity to dispute the liability.

C. The liability is for a trust fund recovery penalty.

D. Both A and B.

34 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AH. A practitioner must “Exercise Due Diligence” in determining the correctness of representations. This includes:

A. Auditing every receipt provided by the client.

B. Making reasonable inquiries if information provided by the client appears incorrect or inconsistent.

C. Contacting the client’s bank to verify income without the client’s knowledge.

D. Hiring a private investigator for every new client.

35 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AI. A “Section 7525” privilege can be asserted in a “Non-Criminal” matter before:

A. The Internal Revenue Service.

B. The U.S. Tax Court.

C. The U.S. District Court (in a civil tax proceeding).

D. All of the above.

36 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AJ. If a practitioner is “Disbarred,” they are prohibited from having any “professional association” with any other practitioner who practices before the IRS. This means the other practitioner:

A. Cannot hire the disbarred person as a consultant for tax-related work.

B. Cannot share office space with the disbarred person.

C. Cannot be the disbarred person's neighbor.

D. Cannot attend the same church as the disbarred person.

37 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AK. The “Small Business/Self-Employed” (SB/SE) division of the IRS generally has jurisdiction over:

A. Corporations with assets over $10 million.

B. Federal, state, and local governments.

C. Tax-exempt organizations.

D. Individual taxpayers with business income (Schedule C, E, or F).

38 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AL. A “Certificate of Subordination” of a Federal Tax Lien (Form 669) is used when:

A. The taxpayer wants to sell their car.

B. The taxpayer is filing for bankruptcy.

C. The IRS agrees to let another creditor (like a bank) take priority over the tax lien (e.g., to secure a loan that helps pay the tax).

D. The tax liability has been paid in full.

39 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AM. Under Circular 230 §10.36, “Firm Leadership” is responsible for “Compliance.” A firm may be sanctioned if:

A. Any one employee makes a mistake on a return.

B. The firm charges more than $300 per hour.

C. The firm fails to have procedures in place to ensure compliance, and a violation occurs.

D. The firm has more than 10 Enrolled Agents.

40 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AN. “Form 8821” (Tax Information Authorization) does NOT allow the appointee to:

A. Represent the taxpayer at an audit meeting.

B. Inspect a taxpayer's transcripts.

C. Receive copies of IRS notices sent to the taxpayer.

D. Discuss the taxpayer's account with an IRS employee.

41 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AO. A “Qualified Appraiser” must include a statement in their appraisal that they understand they can be subject to a penalty for:

A. Charging a fee.

B. Providing a "Substantial or Gross Valuation Misstatement."

C. Working for a corporation.

D. Failing to use a computer to generate the report.

42 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AP. Which of the following is an “Officer” who may represent a corporation before the IRS without a Form 2848 (if they have proper ID and authority)?

A. The Chief Financial Officer (CFO).

B. The President.

C. The Secretary of the corporation.

D. Any of the above (if they are a "Bona Fide" officer).

43 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AQ. A “Statutory Notice of Deficiency” for a joint return must be:

A. Mailed to the husband only.

B. Mailed to the wife only.

C. Mailed as a single joint notice to the last known address (unless the IRS is notified of separate residences).

D. Hand-delivered to the taxpayer’s employer.

44 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AR. Under the “Privacy Act,” the IRS must maintain records that are:

A. Accurate, relevant, timely, and complete.

B. Kept in a locked vault at all times.

C. Written in at least three languages.

D. Available to any member of the public upon request.

45 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AS. An “Enrolled Agent” who is “Inactive” due to a failure to meet CPE requirements:

A. Can still represent clients in collection matters.

B. Can still sign returns for compensation.

C. Is prohibited from practicing before the IRS until they are reinstated.

D. Must pay a fine of $1,000 per month.

46 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AT. A “Closing Agreement” (Form 866) covers:

A. Only a specific transaction (like the basis of a building).

B. The entire tax liability of a taxpayer for a specific tax period.

C. The taxpayer's plan to close their business.

D. An agreement to stop an audit for 30 days.

47 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AU. Under Circular 230, if a practitioner is requested to provide records regarding a “Tax Shelter” and the practitioner does not possess them, they must:

A. Provide information regarding any person the practitioner believes may have possession or control of the records.

B. Simply state they do not have the records and end the inquiry.

C. Subpoena the records from the promoter at their own expense.

D. Both A and B.

48 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AV. A Revenue Officer (RO) is conducting a field interview. According to the IRM, if a taxpayer wishes to record the interview, they must:

A. Provide the RO with 10 days' advance notice.

B. Use their own recording equipment.

C. Allow the IRS to simultaneously record the interview.

D. All of the above.

49 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AW. In a “Collection Due Process” (CDP) hearing, which of the following is considered a “Non-statutory” requirement that the Appeals Officer must verify?

A. That the IRS followed all legal and administrative procedures.

B. That the proposed collection action balances the need for efficient collection with the taxpayer's legitimate concern that the action be no more intrusive than necessary.

C. That the taxpayer has filed all required tax returns for the last 6 years.

D. That the Revenue Officer’s manager has signed off on the levy.

50 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AX. A “Section 6694(a)” penalty for an “Unreasonable Position” is the greater of $1,000 or:

A. 10% of the tax liability.

B. 50% of the income derived (or to be derived) by the preparer.

C. 75% of the income derived by the preparer.

D. The total amount of the taxpayer’s refund.

51 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AY. Which “Form” must be filed by a practitioner to “Withdraw” from a case that is currently pending before the U.S. Tax Court?

A. A written "Motion to Withdraw" filed with the Court.

B. Form 2848.

C. Form 8821.

D. A letter to the OPR.

52 / 96

Tags: Tax Law, Circular 230, IRS Procedures

AZ. The IRS “Office of Professional Responsibility” (OPR) has exclusive jurisdiction over which of the following?

A. Matters related to practitioner conduct and discipline under Circular 230.

B. Tax return preparer fraud.

C. Criminal tax evasion cases.

D. Setting the interest rates for underpayments.

53 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BA. If a taxpayer’s “Offer in Compromise” (OIC) is rejected, they have how many days to appeal the rejection to the Office of Appeals?

A. 15 days.

B. 30 days.

C. 60 days.

D. 90 days.

54 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BB. Under the “Early Referral” process, a taxpayer can request that a specific unagreed issue be moved from Examination to Appeals while the rest of the audit is still ongoing.

A. True.

B. False.

C. Only for corporate taxpayers.

D. Only if the tax at stake is over $1,000,000.

55 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BC. A “Section 7430” award for reasonable litigation costs is NOT available if the taxpayer:

A. Is an Enrolled Agent.

B. Failed to exhaust all administrative remedies within the IRS.

C. Won the case in District Court.

D. Has a net worth exceeding $2 million (for individuals).

56 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BD. The “Taxpayer Bill of Rights” (TBOR) was officially codified into the Internal Revenue Code in what section?

A. Section 7803(a)(3).

B. Section 6103.

C. Section 7201.

D. Section 1.

57 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BE. A “Notice of Intent to Levy” must be sent to the taxpayer at least 30 days before the levy. This notice must be:

A. Hand-delivered to the taxpayer.

B. Left at the taxpayer’s place of business.

C. Sent by certified or registered mail to the last known address.

D. Published in a local newspaper.

58 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BF. If a practitioner is “Censured,” the OPR may “Publicly Censure” the practitioner, which includes publishing their name in:

A. The Internal Revenue Bulletin.

B. The Practitioner’s hometown newspaper.

C. The OPR’s website.

D. Both A and C.

59 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BG. A “Qualified Offer” is deemed rejected if the IRS does not accept it within:

A. 30 days.

B. 90 days.

C. The date the case is settled or the date the court issues a decision.

D. Either B or C, whichever is earliest.

60 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BH. Under Circular 230 §10.31, a practitioner may not “Negotiate” a taxpayer’s refund check. “Negotiate” includes:

A. Endorsing the check for the client.

B. Depositing the check into the practitioner's own bank account.

C. Holding the check for the client in a safe.

D. Both A and B.

61 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BI. Which of the following is a “Disreputable Conduct” item that specifically mentions “contemptuous conduct” before the IRS?

A. §10.51(a)(12).

B. §10.22.

C. §10.34.

D. §10.20.

62 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BJ. A “Taxpayer Assistance Order” (TAO) can be used to:

A. Change the tax law.

B. Release a levy if the NTA determines the taxpayer is suffering a significant hardship.

C. Forgive a tax debt.

D. Stop a criminal investigation.

63 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BK. In a Tax Court case, the “Burden of Proof” shifts to the IRS if the taxpayer introduces “credible evidence” and meets requirements for:

A. Substantiation of items.

B. Recordkeeping.

C. Cooperation with reasonable IRS requests.

D. All of the above.

64 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BL. A practitioner must inform a client of an error in a prior return. Is the practitioner required to “notify the IRS” if the client refuses to correct the error?

A. Yes, they must report the client immediately.

B. No, doing so would violate practitioner-client confidentiality.

C. Only if the error exceeds $10,000.

D. Only if the practitioner is an attorney.

65 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BM. The IRS “Collection” function cannot levy a taxpayer’s property while:

A. An Offer in Compromise is pending.

B. An Installment Agreement request is pending.

C. A CDP hearing request is pending.

D. All of the above.

66 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BN. A “Suit for Damages” against the IRS for “Unauthorized Collection Actions” (Section 7433) requires the taxpayer to prove that an IRS employee acted:

A. Negligently.

B. Recklessly or intentionally.

C. Politically.

D. Without a PTIN.

67 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BO. Under Circular 230 §10.28, “Client Records” that must be returned do NOT include:

A. Documents provided by the client.

B. Returns already filed with the IRS.

C. Practitioner's notes or working papers.

D. Schedules prepared by the practitioner that are necessary for the client to file.

68 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BP. If a practitioner is “Suspended” from practice, they may apply for “Reinstatement” to the OPR:

A. Only after the expiration of the suspension period.

B. 5 years after the suspension.

C. Every 6 months.

D. Never; suspension is permanent.

69 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BQ. A “Letter 1153” is used to:

A. Notify a taxpayer of an audit.

B. Propose the assessment of the Trust Fund Recovery Penalty.

C. Accept an Offer in Compromise.

D. Deny an e-file application.

70 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BR. The “Statute of Limitations” on a Section 6694(a) preparer penalty is:

A. 3 years from the date the return was filed.

B. 6 years from the date the return was filed.

C. 10 years.

D. There is no statute of limitations.

71 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BS. A “Certificate of Release” of a Federal Tax Lien (Form 668) must be filed by the IRS within how many days of the liability being satisfied?

A. 10 days.

B. 30 days.

C. 60 days.

D. 90 days.

72 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BT. Under Circular 230 §10.37, when providing written advice, a practitioner must NOT:

A. Base the advice on unreasonable factual or legal assumptions.

B. Consider the possibility that a return will not be audited.

C. Rely upon representations of the taxpayer that the practitioner knows are incorrect.

D. All of the above.

73 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BU. A “Section 6695A” penalty applies to any person who prepares an appraisal that results in a substantial or gross valuation misstatement. The penalty is the greater of $1,000 or:

A. 10% of the amount of the underpayment.

B. 50% of the fee derived from the appraisal.

C. The lesser of 125% of the fee or 50% of the underpayment.

D. 125% of the gross income derived from the appraisal.

74 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BV. In a U.S. Tax Court “Regular” case (not an S-Case), the parties may “Stipulate” to certain facts. A stipulation is:

A. A request for a jury trial.

B. A formal agreement between the IRS and taxpayer that certain facts are true, which is binding on the Court.

C. A motion to dismiss the case for lack of jurisdiction.

D. A type of subpoena for bank records.

75 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BW. Which “Internal Revenue Manual” (IRM) section is the primary source for “Legal Knowledge” regarding the authorities of the Office of Professional Responsibility?

A. IRM Part 1.

B. IRM Part 4.

C. IRM Part 5.

D. IRM Part 25.

76 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BX. If a taxpayer’s “Innocent Spouse” claim (Form 8857) is denied, the taxpayer has how many days to file a “Request for a Conference” with the Office of Appeals?

A. 15 days.

B. 30 days.

C. 60 days.

D. 90 days.

77 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BY. An “Authorized e-file Provider” must notify the IRS of a change in “Ownership” within:

A. 15 days.

B. 30 days.

C. 45 days.

D. 60 days.

78 / 96

Tags: Tax Law, Circular 230, IRS Procedures

BZ. A “Section 7206” violation for “Fraud and False Statements” is a felony. The maximum prison sentence for a person convicted under this section is:

A. 1 year.

B. 3 years.

C. 5 years.

D. 10 years.

79 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CA. Under Circular 230, “Prompt Disposition” of matters before the IRS means a practitioner must NOT:

A. Fail to answer an IRS phone call within 2 hours.

B. Charge a fee for responding to an IRS notice.

C. Request more than one extension for a tax return.

D. Unreasonably delay the progress of an audit or collection matter.

80 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CB. A “Notice of Levy” on a taxpayer’s “Bank Account” freezes the funds for how many days before the bank must send the money to the IRS?

A. 10 days.

B. 30 days.

C. 21 days.

D. 45 days.

81 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CC. If a practitioner is “Disbarred,” the OPR may allow them to “Consult” with other practitioners on tax matters, provided they do not practice before the IRS.

A. True.

B. False.

C. Only if the practitioner has a law degree.

D. Only if the OPR issues a "Limited Consulting Waiver."

82 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CD. A “Closing Agreement” (Form 906) is unique because it can cover:

A. Future tax years that have not yet occurred.

B. The taxpayer's personal credit score.

C. The tax liability of the taxpayer’s neighbors.

D. The interest rates for the next decade.

83 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CE. Under the “Taxpayer Bill of Rights,” a taxpayer has the right to “Retain Representation.” This means if a taxpayer is in an interview and states they want to consult an EA:

A. The IRS must stop the interview immediately.

B. The IRS can continue for 30 more minutes.

C. The IRS must provide the taxpayer with an EA for free.

D. The IRS can arrest the taxpayer for non-cooperation.

84 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CF. “Form 12153” (CDP Request) must be filed by the taxpayer. Can an EA sign this form for the client?

A. No, the taxpayer must sign it personally.

B. Only if the taxpayer is deceased.

C. Yes, if the EA has a valid Form 2848 on file that includes the authority to sign.

D. Only if the EA is also a family member.

85 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CG. A “Section 6662” Accuracy-Related Penalty is 20% of the underpayment. This penalty is “Stackable” with the Civil Fraud penalty.

A. True.

B. False.

C. Only for corporate taxpayers.

D. Only if the underpayment exceeds $1 million.

86 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CH. Which IRS “Division” handles “Employee Plans” and “Exempt Organizations”?

A. W&I.

B. SB/SE.

C. LB&I.

D. TE/GE.

87 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CI. A “Qualified Appraiser” must have not been “Sanctioned” by the IRS under Section 6695A within the last:

A. 12 months.

B. 3 years.

C. 5 years.

D. 10 years.

88 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CJ. Under Circular 230 §10.52, a practitioner can be sanctioned for a violation that is:

A. Willful.

B. Done through "Gross Incompetence."

C. Done through "Reckless disregard."

D. Any of the above.

89 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CK. A “Frivolous Return” penalty (Section 6702) is currently set at:

A. $500.

B. $1,000.

C. $5,000.

D. $10,000.

90 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CL. The “Kovel” doctrine protects an accountant’s work under attorney-client privilege ONLY if:

A. The accountant is also a lawyer.

B. The accountant is hired by the attorney to translate complex tax concepts for the attorney's legal advice.

C. The client pays the accountant directly.

D. The IRS gives permission in writing.

91 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CM. A “Qualified Offer” MUST be open for acceptance until the “Trial Date” or how many days?

A. 30 days.

B. 60 days.

C. 90 days.

D. 120 days.

92 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CN. “Form 843” (Claim for Refund and Request for Abatement) is used to request the abatement of:

A. Income tax.

B. Interest and certain penalties (like the Failure to Pay penalty).

C. Gift tax.

D. Estate tax.

93 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CO. If a practitioner is “Censured,” the record of the censure is kept by the OPR for how many years?

A. 3 years.

B. 5 years.

C. 10 years.

D. Permanently.

94 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CP. A “Section 7525” privilege can be asserted in a “Summons” proceeding in District Court to “Quash” the summons.

A. True.

B. False.

C. Only if the summons was issued by a Special Agent.

D. Only in the state of Delaware.

95 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CQ. A practitioner who “Knowingly” fails to file their own personal tax return can be:

A. Suspended or Disbarred by the OPR.

B. Subject to a criminal misdemeanor charge.

C. Fined $50,000.

D. Both A and B.

96 / 96

Tags: Tax Law, Circular 230, IRS Procedures

CR. The “Tax Matters Partner” (TMP) concept was largely replaced for partnerships starting in 2018 by the:

A. Partnership Manager.

B. Partnership Representative (PR).

C. Lead Partner.

D. Designated Entity Representative.

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