Part 3 Exam 3 | Med School Hub

EA Full Length Practice Test Part III – Exam 3

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 / 97

Tags: Tax Law, Circular 230, IRS Representation

A. A practitioner is required to exercise “Due Diligence” under Circular 230 §10.22. This requirement specifically applies to which of the following?

A. Preparing or assisting in the preparation of tax returns.

B. Determining the correctness of oral or written representations made to the client.

C. Determining the correctness of representations made to the Department of the Treasury.

D. All of the above.

2 / 97

Tags: Tax Law, Circular 230, IRS Representation

B. Which of the following describes a “Contingent Fee” that is PERMISSIBLE under Circular 230?

A. A fee based on a percentage of the refund shown on an original tax return.

B. A fee for services rendered in connection with the IRS's examination of an original tax return.

C. A fee for representing a client in a judicial proceeding arising under the Internal Revenue Code.

D. Both B and C.

3 / 97

Tags: Tax Law, Circular 230, IRS Representation

C. If a practitioner is “Suspended” from practice before the IRS, they may NOT:

A. Accept new clients for tax preparation.

B. Assist another practitioner in the representation of a taxpayer before the IRS.

C. Sign their own personal income tax return.

D. Provide accounting services for a private bank.

4 / 97

Tags: Tax Law, Circular 230, IRS Representation

D. A “Taxpayer Assistance Order” (TAO) issued by the National Taxpayer Advocate (NTA) can be rescinded only by:

A. The NTA, the Commissioner of the IRS, or the Deputy Commissioner.

B. Any Revenue Officer with more than 10 years of experience.

C. A U.S. Tax Court Judge.

D. The Secretary of the Treasury.

5 / 97

Tags: Tax Law, Circular 230, IRS Representation

E. Which “Form” is used by a taxpayer to voluntarily disclose they have a “Foreign Bank Account” (FBAR) with a balance over $10,000 at any time during the year?

A. Form 1040, Schedule B.

B. Form 8938.

C. FinCEN Form 114.

D. Form 3520.

6 / 97

Tags: Tax Law, Circular 230, IRS Representation

F. If a practitioner discovers that a client has failed to file a required form in a prior year, the practitioner must:

A. . Promptly advise the client of the noncompliance and the consequences.

B. File the form immediately without telling the client

C. Notify the Office of Professional Responsibility (OPR).

D. Resign from the current year's engagement.

7 / 97

Tags: Tax Law, Circular 230, IRS Representation

G. A “Statutory Notice of Deficiency” (90-day letter) is required before the IRS can assess which of the following?

A. Income tax.

B. Estate and gift tax.

C. Certain excise taxes.

D. All of the above.

8 / 97

Tags: Tax Law, Circular 230, IRS Representation

H. Under the “Golsen Rule,” the U.S. Tax Court will:

A. Follow the decision of the U.S. Court of Appeals to which the case is appealable.

B. Always follow its own prior decisions regardless of the circuit court.

C. Only follow decisions made by the U.S. Supreme Court.

D. Defer to the IRS's interpretation of the law.

9 / 97

Tags: Tax Law, Circular 230, IRS Representation

I. A “Section 7525” privilege (Tax Practitioner-Client Privilege) can be asserted in which of the following?

A. A criminal tax investigation.

B. A proceeding involving a "Tax Shelter" as defined in Section 6662.

C. A civil tax audit regarding a home office deduction.

D. A state court divorce proceeding.

10 / 97

Tags: Tax Law, Circular 230, IRS Representation

J. “Form 2848” (Power of Attorney) is typically recorded on the CAF system. If a practitioner wants to represent a client for a “One-Time” matter, they may use:

A. Form 8821.

B. An oral authorization during a phone call with an IRS agent (recorded by the agent).

C. A letter written on the practitioner's own letterhead.

D. Form 8879.

11 / 97

Tags: Tax Law, Circular 230, IRS Representation

K. A practitioner may NOT represent a client if the representation involves a “Conflict of Interest.” However, the practitioner may still represent the client if:

A. The practitioner reasonably believes they can provide competent and diligent representation.

B. The representation is not prohibited by law.

C. Each affected client gives "Informed Consent, confirmed in writing."

D. All of the above.

12 / 97

Tags: Tax Law, Circular 230, IRS Representation

L. The IRS “Collection Statute Expiration Date” (CSED) is generally 10 years from the date of assessment. Which of the following “Suspending Events” pauses the 10-year clock?

A. The taxpayer is living outside the U.S. for a continuous period of at least 6 months.

B. A pending Offer in Compromise (OIC) is under consideration.

C. A request for a Collection Due Process (CDP) hearing.

D. All of the above.

13 / 97

Tags: Tax Law, Circular 230, IRS Representation

M. A “Notice of Federal Tax Lien” (NFTL) is filed to:

A. Seize the taxpayer's bank account.

B. Publicly notify creditors that the IRS has a legal claim against the taxpayer's property.

C. Close the taxpayer's business.

D. Prevent the taxpayer from filing future tax returns.

14 / 97

Tags: Tax Law, Circular 230, IRS Representation

N. A practitioner who is an “Authorized e-file Provider” must provide the taxpayer with a copy of the “Return Receipt” (Acknowledgment) from the IRS.

A. True.

B. Only if the taxpayer is receiving a refund.

C. False.

D. Only if the return was filed late.

15 / 97

Tags: Tax Law, Circular 230, IRS Representation

O. “Circular 230” standards for “Written Advice” require the practitioner to consider:

A. All relevant facts that the practitioner knows or should know.

B. The probability of the return being audited by the IRS.

C. The chance that a specific Revenue Agent will be assigned to the case.

D. The client's ability to pay the practitioner's fee.

16 / 97

Tags: Tax Law, Circular 230, IRS Representation

P. If a practitioner is “Censured” by the OPR, the OPR may also publish the practitioner’s name in:

A. The local newspaper.

B. The Internal Revenue Bulletin (IRB).

C. The Practitioner's personal social media account.

D. A letter sent to all of the practitioner's clients.

17 / 97

Tags: Tax Law, Circular 230, IRS Representation

Q. A “Qualified Appraiser” must have which of the following to be considered “Qualified” by the IRS?

A. A designation from a recognized professional appraiser organization.

B. At least two years of experience in valuing the type of property being appraised.

C. A PTIN issued by the IRS.

D. Both A and B.

18 / 97

Tags: Tax Law, Circular 230, IRS Representation

R. Which of the following is a “Summary Assessment” that does NOT require a 90-day letter?

A. An assessment of a math or clerical error on a return.

B. An assessment of a 20% accuracy penalty.

C. An assessment of an unreported W-2.

D. An assessment of a disallowed business expense.

19 / 97

Tags: Tax Law, Circular 230, IRS Representation

S. An “Enrolled Agent” must complete 72 hours of CPE every three years. Within those 72 hours, how many hours must be “Ethics” credits?

A. 2 hours.

B. 10 hours.

C. 6 hours (2 per year).

D. 12 hours.

20 / 97

Tags: Tax Law, Circular 230, IRS Representation

T. A “Suit for Refund” must be filed in which court?

A. U.S. Tax Court.

B. U.S. District Court or U.S. Court of Federal Claims.

C. U.S. Supreme Court.

D. The Office of Appeals.

21 / 97

Tags: Tax Law, Circular 230, IRS Representation

U. A “Summons” issued by the IRS to a “Third-Party Recordkeeper” (like a bank) must be served to the taxpayer:

A. At least 23 days before the date of the record examination.

B. Only after the records have been seized.

C. Within 3 days of the tax return's due date.

D. Only by a U.S. Marshal.

22 / 97

Tags: Tax Law, Circular 230, IRS Representation

V. Under Circular 230 §10.51, “Disreputable Conduct” includes:

A. Conviction of any felony under Federal or State law.

B. Giving false or misleading information to the Department of the Treasury.

C. Willfully failing to make a Federal tax return.

D. All of the above.

23 / 97

Tags: Tax Law, Circular 230, IRS Representation

W. A “Collection Information Statement” (Form 433-A) is NOT required for which type of Installment Agreement?

A. Streamlined Installment Agreement (under certain dollar thresholds).

B. Offer in Compromise.

C. Partial Payment Installment Agreement.

D. Trust Fund Recovery Penalty negotiation.

24 / 97

Tags: Tax Law, Circular 230, IRS Representation

X. The “Privacy Act of 1974” prohibits the IRS from disclosing a taxpayer’s “Return Information” to:

A. The Department of Justice for tax litigation.

B. A state tax agency (if there is a valid agreement in place).

C. A local credit union for a car loan application (without taxpayer consent).

D. The Social Security Administration.

25 / 97

Tags: Tax Law, Circular 230, IRS Representation

Y. A practitioner must return all “Client Records” upon request. Under Circular 230, “Client Records” include:

A. Documents provided to the practitioner by the client.

B. The practitioner's own working papers and internal notes.

C. Schedules prepared by the practitioner that are necessary for the client to file their return.

D. Both A and C.

26 / 97

Tags: Tax Law, Circular 230, IRS Representation

Z. If a practitioner is “Disbarred” from practice before the Internal Revenue Service, they may petition for reinstatement after how many years?

A. 1 year.

B. 3 years.

C. 5 years.

D. Never; disbarment is permanent.

27 / 97

Tags: Tax Law, Circular 230, IRS Representation

AA. A “Section 6694(b)” penalty for a “Willful or Reckless” understatement by a tax preparer is generally equal to:

A. $1,000 or 50% of the income derived from the return.

B. $5,000 or 75% of the income derived from the return.

C. $250 per return.

D. 10% of the total tax liability.

28 / 97

Tags: Tax Law, Circular 230, IRS Representation

AB. Which of the following is NOT a “Reportable Transaction” that requires disclosure on Form 8886?

A. A "Listed Transaction" (one specifically identified by the IRS as a tax avoidance strategy).

B. A transaction involving a "Confidentiality Agreement" regarding the tax treatment.

C. A standard home mortgage interest deduction.

D. A transaction with "Contractual Protection" against the disallowance of tax benefits.

29 / 97

Tags: Tax Law, Circular 230, IRS Representation

AC. The “Anti-Injunction Act” (Section 7421) generally prevents a taxpayer from:

A. Filing a petition in the U.S. Tax Court.

B. Suing to restrain the assessment or collection of any tax.

C. Requesting a Collection Due Process (CDP) hearing.

D. Applying for an Offer in Compromise.

30 / 97

Tags: Tax Law, Circular 230, IRS Representation

AD. Under Circular 230, a practitioner may “Retain” a client’s records (in states where a lien is allowed) only if:

A. The client has not paid for the current year's tax preparation.

B. There is a dispute over the practitioner's fee.

C. The records are needed for a future IRS audit.

D. The practitioner provides the client with access to review and copy the records.

31 / 97

Tags: Tax Law, Circular 230, IRS Representation

AE. A “Qualified Offer” to settle a tax dispute must be made during which period?

A. After a "Notice of Proposed Deficiency" (30-day letter) is issued but before the case is settled.

B. During the initial audit only.

C. Only after a petition is filed in Tax Court.

D. After the IRS has already won the case.

32 / 97

Tags: Tax Law, Circular 230, IRS Representation

AF. Which of the following “Authorized e-file Providers” is responsible for the actual transmission of the return data to the IRS?

A. ERO (Electronic Return Originator).

B. Intermediate Service Provider.

C. Transmitter.

D. Reporting Agent.

33 / 97

Tags: Tax Law, Circular 230, IRS Representation

AG. If a practitioner is representing a “Corporation” before the IRS, the practitioner must have a Power of Attorney (Form 2848) signed by:

A. Any employee of the corporation.

B. An officer of the corporation having authority to legally bind the entity.

C. The corporation's outside counsel.

D. A 5% shareholder.

34 / 97

Tags: Tax Law, Circular 230, IRS Representation

AH. The “Internal Revenue Manual” (IRM) is:

A. The official source of IRS policies and procedures for its employees.

B. The official law passed by Congress

C. A set of regulations that are binding on all taxpayers.

D. A dictionary of tax terms.

35 / 97

Tags: Tax Law, Circular 230, IRS Representation

AI. A “Trust Fund Recovery Penalty” (TFRP) can be assessed against a “Responsible Person” who:

A. Is an officer or employee of a corporation.

B. Has the duty to collect, account for, and pay over trust fund taxes.

C. Willfully fails to perform such duties.

D. All of the above.

36 / 97

Tags: Tax Law, Circular 230, IRS Representation

AJ. A taxpayer has how many days to file a “Protest” to the Office of Appeals after receiving a 30-day letter (Notice of Proposed Adjustment)?

A. 15 days.

B. 60 days.

C. 30 days.

D. 90 days.

37 / 97

Tags: Tax Law, Circular 230, IRS Representation

AK. Which “Penalty” applies if a taxpayer “Fails to Disclose” a foreign bank account (FBAR) and the failure is determined to be “Willful”?

A. $10,000 flat fee.

B. The greater of $100,000 or 50% of the balance in the account at the time of the violation.

C. 5% of the account balance.

D. Imprisonment for 20 years.

38 / 97

Tags: Tax Law, Circular 230, IRS Representation

AL. Under Circular 230 §10.30, a practitioner may NOT use which of the following in their advertising?

A. Their professional designations (EA, CPA).

B. A statement that they are an "Expert" in tax law.

C. False, fraudulent, or misleading statements.

D. A list of their hourly rates.

39 / 97

Tags: Tax Law, Circular 230, IRS Representation

AM. A “Collection Information Statement” (Form 433-F) is typically used for:

A. Wage-earners and self-employed individuals with smaller tax liabilities.

B. Large corporate audits.

C. Criminal investigations.

D. Requesting a transcript.

40 / 97

Tags: Tax Law, Circular 230, IRS Representation

AN. The “Privacy Act” allows a taxpayer to request an “Amendment” of their records if the records are:

A. Inaccurate, irrelevant, or incomplete.

B. Accurate but embarrassing.

C. Over 10 years old.

D. Written in a font the taxpayer dislikes.

41 / 97

Tags: Tax Law, Circular 230, IRS Representation

AO. An “Enrolled Agent” who wants to “Resign” their enrollment must:

A. Simply stop paying their renewal fee.

B. Send a written request to the Director of the OPR.

C. Give their enrollment card to a client.

D. Post a notice in a local newspaper.

42 / 97

Tags: Tax Law, Circular 230, IRS Representation

AP. Which “Court” is a trial court that hears cases in which a taxpayer sues the U.S. for a “Refund” of taxes already paid?

A. U.S. Tax Court.

B. U.S. Court of Federal Claims.

C. U.S. District Court.

D. Both B and C.

43 / 97

Tags: Tax Law, Circular 230, IRS Representation

AQ. A “Levy” on a taxpayer’s “Principal Residence” requires:

A. The signature of a Revenue Officer only.

B. Written approval from a U.S. District Court Judge or Magistrate.

C. The taxpayer's written consent.

D. An act of Congress.

44 / 97

Tags: Tax Law, Circular 230, IRS Representation

AR. If a practitioner discovers that a client’s tax return from three years ago contained an error, but the statute of limitations for that year has expired, the practitioner:

A. Must still advise the client of the error and the consequences.

B. Can ignore the error since the IRS can no longer assess tax.

C. Must inform the IRS immediately.

D. Must pay the difference themselves.

45 / 97

Tags: Tax Law, Circular 230, IRS Representation

AS. “Form 8300” (Report of Cash Payments Over $10,000) must be filed by a business within how many days of receiving the cash?

A. 5 days.

B. 15 days.

C. 30 days.

D. 45 days.

46 / 97

Tags: Tax Law, Circular 230, IRS Representation

AT. A “Notice of Determination” regarding “Innocent Spouse Relief” allows the taxpayer how many days to petition the Tax Court?

A. 30 days.

B. 60 days.

C. 90 days.

D. 150 days.

47 / 97

Tags: Tax Law, Circular 230, IRS Representation

AU. Which IRS “Division” handles audits for partnerships and corporations with assets between $10 million and $100 million?

A. Wage and Investment (W&I).

B. Small Business/Self-Employed (SB/SE).

C. Large Business and International (LB&I).

D. Criminal Investigation (CI).

48 / 97

Tags: Tax Law, Circular 230, IRS Representation

AV. Under the “Kovel” doctrine, an accountant is protected by attorney-client privilege when:

A. They are hired directly by the client for tax preparation.

B. They are hired by an attorney to assist the attorney in providing legal advice to a client.

C. They are also a licensed attorney.

D. The IRS grants them a special "Kovel Certificate."

49 / 97

Tags: Tax Law, Circular 230, IRS Representation

AW. “Circular 230” §10.36 requires “Firm Leadership” to:

A. Review every single tax return filed by the firm.

B. Take reasonable steps to ensure that the firm has adequate procedures in place for all members to comply with Circular 230.

C. Pay for the CPE of all employees.

D. File a monthly report with the OPR.

50 / 97

Tags: Tax Law, Circular 230, IRS Representation

AX. A “Closing Agreement” (Form 866) differs from a “Closing Agreement on Final Determination covering Specific Matters” (Form 906) because:

A. Form 866 closes the entire tax liability for a period, while Form 906 closes only a specific item or transaction.

B. Form 866 is only for corporations.

C. Form 906 is only for individuals.

D. There is no difference; they are the same form.

51 / 97

Tags: Tax Law, Circular 230, IRS Representation

AY. If a practitioner is charged with “Disreputable Conduct” under Circular 230, the OPR may propose a “Monetary Penalty.” This penalty can be in addition to:

A. Censure.

B. Suspension.

C. Disbarment.

D. All of the above.

52 / 97

Tags: Tax Law, Circular 230, IRS Representation

AZ. A “Notice of Determination” is issued by the Office of Appeals following a Collection Due Process (CDP) hearing. If the taxpayer disagrees with the determination, they must petition the Tax Court within:

A. 30 days.

B. 60 days.

C. 90 days.

D. 150 days.

53 / 97

Tags: Tax Law, Circular 230, IRS Representation

BA. Which of the following is a “Qualified Appraisal” requirement for a non-cash charitable contribution exceeding $5,000?

A. It must be prepared by a "Qualified Appraiser."

B. It must be signed and dated by the appraiser.

C. It must not involve a prohibited appraisal fee (e.g., a fee based on a percentage of the appraised value).

D. All of the above.

54 / 97

Tags: Tax Law, Circular 230, IRS Representation

BB. Under Circular 230 §10.20, if the IRS requests records that are NOT in the practitioner’s possession, the practitioner must:

A. Notify the IRS that they do not have the records.

B. Provide any information they have regarding who might possess the records.

C. Subpoena the records from the client.

D. Both A and B.

55 / 97

Tags: Tax Law, Circular 230, IRS Representation

BC. A “Section 6695” penalty may be imposed on a tax return preparer for which of the following?

A. Failing to sign a return when required.

B. Failing to furnish a identification number (PTIN) on a return.

C. Failing to retain a copy of the return or a list of taxpayers.

D. All of the above.

56 / 97

Tags: Tax Law, Circular 230, IRS Representation

BD. If a practitioner is “Censured,” the OPR may also require the practitioner to:

A. Take additional CPE courses.

B. Work under the supervision of another practitioner for a period of time.

C. Submit all future tax returns to the OPR for review before filing.

D. Both A and B.

57 / 97

Tags: Tax Law, Circular 230, IRS Representation

BE. A “Statutory Notice of Deficiency” (90-day letter) is generally sent to the taxpayer via:

A. Regular first-class mail.

B. Certified or registered mail.

C. Personal delivery by a Revenue Officer.

D. Email.

58 / 97

Tags: Tax Law, Circular 230, IRS Representation

BF. Which “Form” is used to request a “Collection Due Process” (CDP) hearing?

A. Form 12153.

B. Form 9465.

C. Form 656.

D. Form 2848.

59 / 97

Tags: Tax Law, Circular 230, IRS Representation

BG. Under Circular 230, a practitioner may NOT “Sign” a tax return if the practitioner knows that the return contains a position that:

A. Is "Frivolous."

B. Lacks "Substantial Authority" and is not disclosed.

C. Is a "Tax Shelter" and is not "More Likely Than Not" to be sustained.

D. All of the above.

60 / 97

Tags: Tax Law, Circular 230, IRS Representation

BH. A “Summons” issued to a taxpayer for their own records is called a:

A. Third-Party Summons.

B. John Doe Summons.

C. Direct Summons.

D. Administrative Summons.

61 / 97

Tags: Tax Law, Circular 230, IRS Representation

BI. If an Enrolled Agent’s “Enrollment” has “Lapsed” due to failure to renew, the EA:

A. Is permanently barred from practicing.

B. May not practice before the IRS until their enrollment is updated.

C. Can still represent clients if they pay a late fee.

D. Must retake the SEE exam immediately.

62 / 97

Tags: Tax Law, Circular 230, IRS Representation

BJ. Which of the following is NOT a valid “Reasonable Cause” for the abatement of a late-filing penalty?

A. Death or serious illness of the taxpayer or immediate family.

B. Destruction of records by fire or other casualty.

C. Lack of funds to pay the tax.

D. Reliance on erroneous written advice from the IRS.

63 / 97

Tags: Tax Law, Circular 230, IRS Representation

BK. A “Qualified Joint Venture” (QJV) allows a married couple to file as two sole proprietorships on a joint return instead of a partnership. This is only available if:

A. The only members of the joint venture are a married couple who file a joint return.

B. Both spouses materially participate in the trade or business.

C. Both spouses elect this treatment.

D. All of the above.

64 / 97

Tags: Tax Law, Circular 230, IRS Representation

BL. Under the “Freedom of Information Act” (FOIA), a person can request:

A. Any taxpayer's tax return.

B. The DIF scores of their competitors.

C. Internal IRS training manuals.

D. The private home phone numbers of IRS managers.

65 / 97

Tags: Tax Law, Circular 230, IRS Representation

BM. A “Collateral Agreement” in an Offer in Compromise (OIC) is used to:

A. Secure the payment of the offered amount.

B. Waive the taxpayer's right to appeal.

C. Provide for additional payments if the taxpayer's income increases in the future.

D. Pay the practitioner's fee.

66 / 97

Tags: Tax Law, Circular 230, IRS Representation

BN. If a practitioner is representing a “Partnership” before the IRS, the “Tax Matters Partner” (or Partnership Representative) is typically:

A. The partner with the largest interest.

B. A person designated by the partnership to act on its behalf.

C. Any partner chosen by the IRS.

D. The partnership's CPA.

67 / 97

Tags: Tax Law, Circular 230, IRS Representation

BO. A “Jeopardy Assessment” is made when:

A. The IRS believes the assessment or collection of tax will be endangered by delay.

B. The taxpayer is in jail.

C. The taxpayer owes more than $100,000.

D. The statute of limitations is about to expire in 5 days.

68 / 97

Tags: Tax Law, Circular 230, IRS Representation

BP. Which “Form” is used by a practitioner to report “Suspected Tax Fraud” by a third party (not a client)?

A. Form 211.

B. Form 3949-A.

C. Form 14039.

D. Form 8821.

69 / 97

Tags: Tax Law, Circular 230, IRS Representation

BQ. A “Closing Agreement” (Form 866 or 906) can be “Reopened” by the IRS or the taxpayer only if there is a showing of:

A. Fraud.

B. Malfeasance.

C. Misrepresentation of a material fact.

D. Any of the above.

70 / 97

Tags: Tax Law, Circular 230, IRS Representation

BR. Under Circular 230, a practitioner must not “unreasonably delay” the prompt disposition of any matter before the IRS. This includes:

A. Failing to respond to an IRS inquiry within a reasonable time.

B. Repeatedly postponing meetings without a valid reason.

C. Withholding information that is not privileged.

D. All of the above.

71 / 97

Tags: Tax Law, Circular 230, IRS Representation

BS. An “Authorized e-file Provider” must notify the IRS if they “Suspend” their e-file operations for more than:

A. 1 week.

B. 30 days.

C. 1 year.

D. 6 months.

72 / 97

Tags: Tax Law, Circular 230, IRS Representation

BT. A “Certificate of Discharge” of a Federal Tax Lien (Form 669) is used to:

A. Remove the lien from all of the taxpayer's property.

B. Remove the lien from a specific piece of property (e.g., to allow it to be sold).

C. Prove the tax has been paid.

D. Withdraw the lien from public records.

73 / 97

Tags: Tax Law, Circular 230, IRS Representation

BU. If a practitioner is convicted of a “Misdemeanor” involving “Dishonesty or Breach of Trust,” the OPR may:

A. Disbar the practitioner.

B. Suspend the practitioner.

C. Censure the practitioner.

D. All of the above.

74 / 97

Tags: Tax Law, Circular 230, IRS Representation

BV. Which “Form” is used to appeal a “Trust Fund Recovery Penalty” (TFRP) assessment?

A. Form 12153.

B. Form 1153 (Response to).

C. Form 1040-X.

D. Form 843.

75 / 97

Tags: Tax Law, Circular 230, IRS Representation

BW. An “Authorized e-file Provider” may be issued a “Letter of Admonishment” by the IRS. This is considered:

A. A formal sanction that can be appealed to the Office of Appeals.

B. A private communication that does not affect the provider's status.

C. A criminal charge.

D. A notice that the provider's PTIN has been permanently revoked.

76 / 97

Tags: Tax Law, Circular 230, IRS Representation

BX. Under Circular 230, a practitioner who is “Disbarred” may not “Practice before the Internal Revenue Service.” Does this include representing oneself (pro se) in a personal tax audit?

A. No, everyone has a right to represent themselves.

B. Yes, disbarred practitioners cannot talk to the IRS at all.

C. Only if the audit involves a business they own.

D. Only if the OPR specifically bans personal representation.

77 / 97

Tags: Tax Law, Circular 230, IRS Representation

BY. Which of the following is a “Qualified Appraisal” requirement for a gift of art valued at $20,000?

A. The appraiser must be the gallery that sold the art to the taxpayer.

B. The appraisal must be received by the taxpayer before the due date of the return.

C. The appraisal must be conducted by the IRS Art Advisory Panel.

D. The appraisal must be performed by a person with a Ph.D. in Art History.

78 / 97

Tags: Tax Law, Circular 230, IRS Representation

BZ. If a practitioner is representing a client in an audit and the Revenue Agent refuses to speak with the practitioner, the practitioner should:

A. Complain to the agent’s Group Manager regarding a violation of the Taxpayer Bill of Rights.

B. Advise the client to lie to the agent.

C. Physically block the agent’s office door.

D. Tell the client to pay the full tax immediately.

79 / 97

Tags: Tax Law, Circular 230, IRS Representation

CA. A “Statutory Notice of Deficiency” (90-day letter) is NOT required for an assessment of:

A. Income tax.

B. Estate tax.

C. Social Security (FICA) taxes.

D. Gift tax.

80 / 97

Tags: Tax Law, Circular 230, IRS Representation

CB. Under the “Hobby Loss” rules (Section 183), the IRS may presume an activity is “engaged in for profit” if it shows a profit in at least:

A. 1 out of 5 years.

B. 2 out of 7 years (for horse racing).

C. 5 out of 5 years.

D. 3 out of 5 years.

81 / 97

Tags: Tax Law, Circular 230, IRS Representation

CC. A practitioner must “Promptly” notify a client of any error or omission. If the practitioner also prepares the client’s current year return, they should:

A. Incorporate the error into the new return to "balance" it out.

B. Wait for the IRS to catch the error before doing anything.

C. Advise the client to file an amended return (Form 1040-X) for the prior year.

D. Ignore the error if it was for less than $500.

82 / 97

Tags: Tax Law, Circular 230, IRS Representation

CD. “Form 12153” (Request for a Collection Due Process Hearing) must be filed within how many days of the “Notice of Intent to Levy”?

A. 30 days.

B. 10 days.

C. 60 days.

D. 90 days.

83 / 97

Tags: Tax Law, Circular 230, IRS Representation

CE. A “Qualified Offer” can be made by a taxpayer to settle a case. If the IRS rejects the offer and the court later determines the liability is equal to or less than the offer, the taxpayer may be entitled to:

A. A full refund of all taxes ever paid.

B. Recovery of reasonable litigation and administrative costs.

C. A letter of apology from the IRS Commissioner.

D. A 50% reduction in future taxes.

84 / 97

Tags: Tax Law, Circular 230, IRS Representation

CF. If a practitioner is “Suspended” from practice, they may not “Practice” before the IRS. “Practice” includes:

A. Preparing a tax return for a fee.

B. Representing a taxpayer at an Appeals conference.

C. Advocating for a taxpayer in a letter to the IRS.

D. All of the above.

85 / 97

Tags: Tax Law, Circular 230, IRS Representation

CG. A “Notice of Federal Tax Lien” (NFTL) is valid for 10 years and 30 days. If the IRS wants to keep the lien active after that period, they must:

A. Do nothing; it is permanent.

B. Call the taxpayer and ask for permission.

C. Sue the taxpayer in District Court.

D. File a "Refiled Notice of Federal Tax Lien."

86 / 97

Tags: Tax Law, Circular 230, IRS Representation

CH. Under Circular 230, a practitioner may not “Sign” a return that the practitioner knows contains a “Frivolous” position. A position is “Frivolous” if it is:

A. Extremely funny.

B. Based on a disagreement with the current tax rates.

C. Patently improper or lacks any basis in law or fact.

D. Both B and C.

87 / 97

Tags: Tax Law, Circular 230, IRS Representation

CI. If a practitioner’s “PTIN” is revoked by the IRS, the practitioner:

A. Is prohibited from preparing federal tax returns for compensation

B. . Can still represent clients in audits.

C. Must pay a fine of $5,000 per return prepared.

D. Both B and C.

88 / 97

Tags: Tax Law, Circular 230, IRS Representation

CJ. Which IRS “Office” is responsible for the oversight of Enrolled Agents and other practitioners?

A. Office of Appeals.

B. Criminal Investigation (CI).

C. Office of Professional Responsibility (OPR).

D. Taxpayer Advocate Service (TAS).

89 / 97

Tags: Tax Law, Circular 230, IRS Representation

CK. A “Collateral Agreement” is often required in an OIC if the taxpayer’s “Future Income” is expected to:

A. Decrease significantly.

B. Be paid in cryptocurrency.

C. Stay exactly the same.

D. Increase significantly.

90 / 97

Tags: Tax Law, Circular 230, IRS Representation

CL. Under the “Freedom of Information Act” (FOIA), the IRS must respond to a request for records within:

A. 10 business days.

B. 20 business days.

C. 30 business days.

D. 60 business days.

91 / 97

Tags: Tax Law, Circular 230, IRS Representation

CM. A “Certificate of Nonattachment” of a Federal Tax Lien is issued to:

A. Release a lien after the tax is paid.

B. Stop the IRS from seizing a car.

C. Clarify that a lien filed against a person with a similar name does NOT apply to the taxpayer.

D. End a bankruptcy proceeding.

92 / 97

Tags: Tax Law, Circular 230, IRS Representation

CN. If a practitioner discovers that a client has “understated” their income on a return the practitioner is currently preparing, the practitioner must:

A. Refuse to sign the return unless the income is properly reported.

B. Report the client to the IRS.

C. Sign the return anyway and let the client take the risk.

D. Charge the client a higher fee for the "extra work."

93 / 97

Tags: Tax Law, Circular 230, IRS Representation

CO. A “Qualified Appraiser” must NOT be:

A. The taxpayer.

B. The person who sold the property to the taxpayer.

C. An employee of the taxpayer.

D. All of the above.

94 / 97

Tags: Tax Law, Circular 230, IRS Representation

CP. “Form 8821” (Tax Information Authorization) allows a practitioner to:

A. Sign a tax return for the client.

B. Receive and inspect the client’s tax information, but not represent them.

C. Execute an installment agreement for the client.

D. Represent the client in a CDP hearing.

95 / 97

Tags: Tax Law, Circular 230, IRS Representation

CQ. If a practitioner is “Disbarred” from practice, they must notify their clients that they can no longer practice before the IRS.

A. True.

B. False.

C. Only if the client is a corporation.

D. Only if the practitioner feels like it.

96 / 97

Tags: Tax Law, Circular 230, IRS Representation

CR. The “U.S. Tax Court” has how many “Special Trial Judges”?

A. Exactly 5.

B. Exactly 19.

C. A number determined by the Chief Judge as needed.

D. None; all Tax Court judges are equal.

97 / 97

Tags: Tax Law, Circular 230, IRS Representation

CS. Which “Form” is used to apply for an “Extension of Time to File” a federal income tax return for an individual?

A. Form 2848.

B. Form 4868.

C. Form 7004.

D. Form 1040-X.

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