,Essentials of Federal Taxation, 11e (Spilker)
Chapter 2 Tax Compliance, the IRS, and Tax Authorities
1) Corporations are required to file a tax return annually regardless of their taxable income.
Answer: TRUE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
2) The tax return filing requirements for individual taxpayers only depend on the taxpayer's
filing status.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
3) If a taxpayer is due a refund, she does not have to file a tax return.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
,4) If April 15th falls on a Saturday, the due date for individual tax returns will be on Monday,
April 17th (assuming it is not a holiday).
Answer: TRUE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
5) If an individual taxpayer is unable to file a tax return by its original due date, the taxpayer can
request an automatic nine-month extension to file the return.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
6) An extension to file a tax return does not extend the due date for tax payments.
Answer: TRUE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
7) The statute of limitations for IRS assessment generally ends four years after the date a tax
return is filed.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
, 8) For fraudulent tax returns, the statute of limitations for IRS assessment is 10 years.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
9) The IRS DIF system checks each tax return for mathematical mistakes and errors.
Answer: FALSE
Difficulty: 2 Medium
Topic: IRS Audit Selection
Learning Objective: 02-02 Outline the IRS audit process, how returns are selected, the different
types of audits, and what happens after the audit.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
10) Joel reported a high amount of charitable contributions as a deduction on his individual tax
return relative to taxpayers with similar income levels. The information matching program is the
IRS program most likely to identify Joel's tax return for audit.
Answer: FALSE
Difficulty: 2 Medium
Topic: IRS Audit Selection
Learning Objective: 02-02 Outline the IRS audit process, how returns are selected, the different
types of audits, and what happens after the audit.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
11) Office examinations are the most common type of IRS audit.
Answer: FALSE
Difficulty: 2 Medium
Topic: IRS Audit Selection
Learning Objective: 02-02 Outline the IRS audit process, how returns are selected, the different
types of audits, and what happens after the audit.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
Chapter 2 Tax Compliance, the IRS, and Tax Authorities
1) Corporations are required to file a tax return annually regardless of their taxable income.
Answer: TRUE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
2) The tax return filing requirements for individual taxpayers only depend on the taxpayer's
filing status.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
3) If a taxpayer is due a refund, she does not have to file a tax return.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
,4) If April 15th falls on a Saturday, the due date for individual tax returns will be on Monday,
April 17th (assuming it is not a holiday).
Answer: TRUE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Measurement / Reflective Thinking
5) If an individual taxpayer is unable to file a tax return by its original due date, the taxpayer can
request an automatic nine-month extension to file the return.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
6) An extension to file a tax return does not extend the due date for tax payments.
Answer: TRUE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
7) The statute of limitations for IRS assessment generally ends four years after the date a tax
return is filed.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
, 8) For fraudulent tax returns, the statute of limitations for IRS assessment is 10 years.
Answer: FALSE
Difficulty: 1 Easy
Topic: Taxpayer Filing Requirements
Learning Objective: 02-01 Identify the filing requirements for income tax returns and the
statute of limitations for assessment.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
9) The IRS DIF system checks each tax return for mathematical mistakes and errors.
Answer: FALSE
Difficulty: 2 Medium
Topic: IRS Audit Selection
Learning Objective: 02-02 Outline the IRS audit process, how returns are selected, the different
types of audits, and what happens after the audit.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
10) Joel reported a high amount of charitable contributions as a deduction on his individual tax
return relative to taxpayers with similar income levels. The information matching program is the
IRS program most likely to identify Joel's tax return for audit.
Answer: FALSE
Difficulty: 2 Medium
Topic: IRS Audit Selection
Learning Objective: 02-02 Outline the IRS audit process, how returns are selected, the different
types of audits, and what happens after the audit.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
11) Office examinations are the most common type of IRS audit.
Answer: FALSE
Difficulty: 2 Medium
Topic: IRS Audit Selection
Learning Objective: 02-02 Outline the IRS audit process, how returns are selected, the different
types of audits, and what happens after the audit.
Bloom's: Remember
Accessibility: Keyboard Navigation; Screen Reader Compatible
AICPA/AACSB: FN Research / Reflective Thinking
