1. Which of the following statements regarding the Participation Exemption is false?

A. The exemption is a 50% dividends received deduction (DRD) that is generally available for the foreign-source portion of dividends received.

B. There is a holding period requirement for the qualifying stock.

C. No foreign tax credit is allowed with respect to any dividends that qualify for the deduction.

D. This provision generally eliminates any additional U.S. tax on such foreign profits.

2. Under the Internal Revenue Code, a CPA who was engaged in the business of preparing tax returns could incur a penalty for disclosing taxpayer information without the taxpayer's formal consent in which of the following circumstances?

A. The information was disclosed in the client's state and local tax returns that the CPA prepared.

B. The information was disclosed in the client's electronically filed tax return.

C. The information was disclosed pursuant to an attorney's solicitation request.

D. The information was disclosed pursuant to a court order

3.Which of the following would be required to register for a Preparer Tax Identification Number (PTIN)?

A.A CPA preparing returns in exchange for services but receiving no monetary compensation.

B.A CPA preparing returns for family and friends for no charge.

C. A CPA preparing a return for an entity as an employee of that entity.

D.A CPA's assistant who enters taxpayer data into an electronic tax return preparation system.