Question

With regard to a tax return position, a CPA should advise a taxpayer of:

a) Relevant tax return disclosure responsibilities
b) Recent tax court rulings on similar tax positions
c) The CPA's ethical obligations
d) Penalties imposed by the taxing authority

Answer 1

A CPA should advise a taxpayer of relevant tax return disclosure responsibilities, recent tax court rulings on similar tax positions, and the CPA's ethical obligations.

Step-by-step explanation:

A CPA should advise a taxpayer of the following in regard to a tax return position:

1. Relevant tax return disclosure responsibilities: The CPA should inform the taxpayer about the specific tax return disclosure requirements that are applicable to their situation. This includes reporting all relevant income, deductions, and credits accurately and in accordance with the tax laws.
2. Recent tax court rulings on similar tax positions: The CPA should stay informed about recent tax court rulings that may affect the taxpayer's position. This helps ensure that the taxpayer is aware of any changes in interpretation or application of the tax laws that may impact their tax return.
3. The CPA's ethical obligations: The CPA should adhere to professional ethics and disclose any potential conflicts of interest that may arise in providing tax advice to the taxpayer. They should prioritize the taxpayer's best interests and provide unbiased and objective guidance.