A CPA assists a taxpayer in tax planning regarding a transaction that meets the definition of a tax shelter as defined in the Internal Revenue Code. Under the AICPA Statements on Standards for Tax Services, the CPA should inform the taxpayer of the penalty risks unless the transaction, at the minimum, meets which of the following standards for being sustained if challenged?
A. More likely than not.
B. Not frivolous.
C. Realistic possibility.
D. Substantial authority.
Answer: C. Realistic possibility.
Business
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(A) Because they sell about 90 percent of the products sold in the United States. (B) Because they have a legal identity separate from those of their owners. (C) Because they may merge in various ways. (D) Because they require a certificate of incorporation.
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The profitability index is the ratio of the present value of the benefits to the present value of the
costs. Indicate whether the statement is true or false
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