2025 GL1 TEST FINAL GAME

Front

Which situation first requires a statutory notice of deficiency to be provided to the taxpayer before the IRS may assess? Options: Math error on a filed return, Balance due shown on a filed return, An employment tax liability, None of the above

Back

None of the above

Answer explanation

Section 6213(b) excepts math errors from requiring SNODs. Section 6211 defines deficiencies to exclude amounts that the taxpayer reports. It also limits deficiencies to income, estate, and gift taxes, as well as certain excise taxes, so an employment tax is NOT a deficiency tax.

Front

Generally, how long does the Service have to initiate an administrative levy, or file a lawsuit, to collect a liability after it is assessed?

Back

10 years.

Answer explanation

The general CSED under I.R.C. § 6502 is 10 years from the date of assessment.

Front

The definition of “overpayment” is found in: Case law, Statute, Regulation, Revenue Procedure

Back

Case law

Answer explanation

“Overpayment” is not defined in the Code, regulations, or any subregulatory guidance.  It is defined in the case Jones v. Liberty Glass.  Section 6401 does not define “overpayment,” it merely identifies additional issues that may be considered as an overpayment although they do not meet the standard definition under Liberty Glass.

Front

A summons is enforceable if...

Back

it is issued for a legitimate, proper purpose; it seeks information that is or may be relevant to the investigation and is not already in the IRS’s possession; the IRS has followed all administrative steps required by the Code.

Answer explanation

Options A-C are all factors established by US v. Powell the IRS must show in order to enforce a summons.

Front

What is the statute of limitations for assessment if the T/P does not file a return?

Back

None of the above

Answer explanation

Section 6501(c)(3) provides that in the case of failure to file a return the tax may be assessed at any time.

Front

Written approval by Area Counsel is required for all jeopardy assessments.

Back

True

Front

One of the two valid defenses for failing to honor a levy is that the person is not in possession of property of the taxpayer.

Back

True

Front

The IRS has the authority to abate the unpaid portion of an assessed tax if: The tax is excessive in amount, The tax is assessed after the expiration of the Assessment Statute Expiration Date (“ASED”), The tax is erroneously or illegally assessed.

Back

All of the above.

Answer explanation

Section 6404(a).

Front

A certified transcript (i.e., Forms 2866 and 4340) constitutes presumptive evidence of a valid assessment.

Back

True

Front

A Notice of Federal Tax Lien (“NFTL”) must be filed in order for the federal tax lien to have priority over any other interest.

Back

False

Answer explanation

Section 6323 cedes the priority of the FTL ONLY to those interests listed in section 6323(a) (purchaser, holder of a security interest, mechanic's lienor, or judgement lien creditor). The priority vis-a-vis some other competing interest, for example, a state tax lien interest, is determined by the "first in time first in right" rule.