Preparers, Proof, and Privilege (LO 12.5)

For each of the following situations, indicate the amount of the penalty that could be imposed on the tax return preparer:

a. A tax return preparer understates the taxpayer's tax liability with a frivolous position and does not disclose the position. The greater of $ or percent of the income derived by the tax preparer for an undisclosed unrealistic position.

b. A tax return preparer fails to furnish his identifying number. $

c. A tax return preparer aids a taxpayer in understating a tax liability. $

d. A tax return preparer endorses and cashes a client's tax refund check. $