The most effective system available to prepare for the new Tax Return Preparer Competency ExamIn recent years, the role of third party assistance in tax return preparation within the United States has become more significant. To acknowledge this trend, the IRS is strengthening partnerships with tax practitioners, tax return preparers, and other third parties in order to ensure effective tax administration that adheres to professional standards and follows the law.
Beginning in 2011, tax return preparers are required to pass a competency test to officially become registered tax return preparers. TheWiley Registered Tax Return Preparer Exam Review Book 2012 has been designed with this in mind and is the perfect guide to help you pass this comprehensive test. The course, complete with extensive exercises and a final exam review, will provide you with a solid foundation on the subject of taxes, and the preparation of an accurate and complete income tax return. Along the way, it covers specific tax issues you need to be familiar with, including tax theory and law; conducting a thorough client interview; and offering tax advice and explanations to clients.
Helps you zero in on areas that need work, organize your study program, and concentrate your effortsProvides paid tax return preparers who are not enrolled agents, attorneys, or Certified Professional Accountants (CPAs) with the individual taxation information they need to pass this competency testCovers the major parts of the exam and how to approach each one
Informative and insightful, theWiley Registered Tax Return Preparer Exam Review Book 2012 will put you in the best position possible to pass this important exam.
Introduction vii
Strategies for Success on the Registered Tax Return Preparer Exam xi
Part 1 The Income Tax Return 1
Chapter 1 Filing Information 3
Chapter 2 Filing Status 13
Chapter 3 Personal and Dependency Exemptions 25
Part 2 Income and Assets 39
Chapter 4 Wages, Salaries, and Other Earnings 41
Chapter 5 Interest Income 53
Chapter 6 Dividends and Other Corporate Distributions 65
Chapter 7 Rental Income and Expenses 73
Chapter 8 Retirement Plans, Pensions, and Annuities 85
Chapter 9 Social Security and Equivalent Railroad Retirement Benefits 101
Chapter 10 Other Types of Income 109
Chapter 11 Self-Employment Activities 121
Chapter 12 Basis of Property 141
Chapter 13 Sale of Property 151
Chapter 14 Sale of Home 169
Chapter 15 IRA and HSA Contributions 181
Chapter 16 Education-Related Adjustments 191
Chapter 17 Business-Related Adjustments 199
Chapter 18 Alimony 209
Part 3 Deductions and Credits 217
Chapter 19 Standard and Itemized Deductions 219
Chapter 20 Medical and Dental Expenses 225
Chapter 21 Tax Payments 235
Chapter 22 Interest Payments 243
Chapter 23 Charitable Contributions 255
Chapter 24 Nonbusiness Casualty and Theft Losses 269
Chapter 25 Miscellaneous Itemized Deductions 279
Chapter 26 Employee Business Expenses 289
Chapter 27 Earned Income Credit 305
Chapter 28 Child and Dependent Care Credit 317
Chapter 29 Child Tax Credit 325
Chapter 30 Education Credits 331
Chapter 31 Other Tax Credits 339
Part 4 Other Taxes 357
Chapter 32 Figuring the Regular Tax 359
Chapter 33 The Alternative Minimum Tax 369
Chapter 34 The Kiddie Tax 377
Chapter 35 Other Taxes 387
Part 5 Completion of the Filing Process 397
Chapter 36 Tax Payments and Refund Options 399
Chapter 37 Completing and Filing the Return 413
Part 6 Practices and Procedures 423
Chapter 38 Preparer Responsibilities and Penalties 425
Part 7 Ethics and Circular 230 437
Chapter 39 Rules Governing Authority to Practice before the IRS 439
Chapter 40 Duties and Restrictions Relating to Practice before the IRS 447
Chapter 41 Sanctions for Violating Circular 230 459
Answers to Review Questions 469
Appendix: IRS Resources 507
Index 509
