Taxpayers face the risk of the 20% § 6662 accuracy-related penalty when they take too-aggressive return positions. Which of the following generally would not be an adequate defense against the IRS’s assertion of that penalty? (a) Establishing that the taxpayer had either (i) a “reasonable basis” (if the posi-tion was adequately disclosed) or (ii) “substantial authority” for the position when taken. (b) Establishing that the taxpayer used TurboTax or other commercial software in preparing the return. (c) Establishing that the taxpayer had hired and paid a reputable and experienc-ed CPA to prepare the return and had provided all relevant information to that CPA. (d) Winning on the underlying substantive issue(s) – i.e., successfully defending the return as filed (no deficiency, no penalty). (e) Actually, a taxpayer cannot escape the accuracy-related penalty once the IRS asserts it.
Taxpayers face the risk of the 20% § 6662 accuracy-related penalty when they take too-aggressive return positions. Which of the following generally would not be an adequate defense against the IRS’s assertion of that penalty?
(a) Establishing that the taxpayer had either (i) a “reasonable basis” (if the posi-tion was adequately disclosed) or (ii) “substantial authority” for the position when taken.
(b) Establishing that the taxpayer used TurboTax or other commercial software in preparing the return.
(c) Establishing that the taxpayer had hired and paid a reputable and experienc-ed CPA to prepare the return and had provided all relevant information to that CPA.
(d) Winning on the underlying substantive issue(s) – i.e., successfully defending the return as filed (no deficiency, no penalty).
(e) Actually, a taxpayer cannot escape the accuracy-related penalty once the IRS asserts it.
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