Multiple Choice Questions

1. An employer withholds federal taxes from employees’ paychecks and periodically makes payments of the withheld taxes to the IRS. What happens if such an employer files bankruptcy and is unable to remit the final payment of taxes withheld?

a. The matter would be resolved in the bankruptcy court.

b. The employer could be criminally charged regardless of what happens in the bankruptcy court.

c. The employer could be criminally charged only if sufficient funds do not emerge from the bankruptcy to pay the taxes due.

d. None of these.

2. Willful failure to file a federal tax return is which of the following?

a. A criminal offense.

b. A civil offense.

c. Sometimes a criminal offense.

d. None of these.

3. Failure to supply information associated with a federal tax return is a criminal offense defined by which of the following?

a. IRC § 7201.

b. IRC § 7202.

c. IRC § 7203.

d. None of these.

4. A taxpayer who alters an invoice in support of an inflated deduction violates the statute that governs the delivery of fraudulent returns, statements, and other documents in which of the following?

a. IRC § 7201.

According to IRC § 7201, any person who willfully attempts to evade or defeat any tax imposed by the Internal Revenue Code or the payment of the tax will, in addition to other penalties provided by law, be guilty of a felony and, if convicted, may be fined not more than $100,000 ($500,000 in the case of a corporation) or imprisoned not more than five years, or both, in addition to paying the costs of prosecution. (The $100,000 limit on the fine for individuals is now $500,000 per Title 18, § 3571.)

b. IRC § 7202.

c. IRC § 7203.

d. None of these.

5. When a taxpayer files a false W-4 form and fails to a file return when a significant tax deficiency exists, evasion charges may be filed under which of the following in addition to charges under IRC § 7203 and IRC § 7205?

a. IRC § 7201.

b. IRC § 7202.

c. IRC § 7203.

d. None of these.