QUESTION 3 Of the following choices, which type of income contributes most to the underreporting tax gap for individual taxpayers? a. Income subject to substantial information reporting and withholding O b.income subject to substantial information reporting OC. Income subject to little or no information reporting, Od. Income subject to some information reporting QUESTION 4 Pat, who has not requested an automatic extension of time to file his tax return, realized on April 14 that he has yet to file his tax return for the year. After work on April 14. Pat fills out all the required forms and schedules, and rushes to the mailbox with his roommate to drop off his tax return. Unfortunately, the postmark on the envelope was hastily applied and rendered illegible. Several months later, Pat receives a notice from the IRS stating that Pat owes a penalty for failing to file on time. Assuming that Pat lives in California (and thus courts would be bound to accept the approach in the Baldwin case) if Pat challenges this penalty, will Pat's roommate be able to testify that he was with Pat when he dropped his return in the mailbox on April 14? a. No, Pat's roommate will not be able to testify. The court in Baldwin clearly indicated that Section 7502 precludes the use of extrinsic evidence to prove mailing b. Yes, under the common law mailbox rule that the Baldwin court said still is relevant. Pat will be able to call his roommate, who will be able to say that he witnessed Pat drop the return in the mailbox because Section 7502 of the Internal Revenue Code does not limit the use of extrinsic evidence to prove mailing, OC No, as per Baldwin Pat's roommate will not be able to testify. However, because Pat used an approved mailing service, he will prevail. O d. Yes, Pat will be able to call his roommate, but under Baldwin only if there is direct evidence in addition to the roommate's testimony, such as security tapes or a neutral witness who can also testify