Exactly same RTRP exam dumps as in actual test.

Registered Tax Return Preparer test Dumps

RTRP test Format | Course Contents | Course Outline | test Syllabus | test Objectives

The Registered Tax Return Preparer Test (RTRP) focuses on the ethical
responsibilities of federal tax return preparers and the completion of the Form 1040
series returns including basic related schedules and forms. The test specifications
below are intended to provide guidance on the content of the RTRP test. The
examples provided within each item are not all inclusive of what may be tested in a
given area. All efforts have been made to develop Braindumps based on
general tax rules covered in IRS publications, forms and instructions rather than
exceptions found only in the Internal Revenue Code or Income Tax Regulations.

Domain 1 – Preliminary Work and Collection of Taxpayer Data

1. Review prior years return for accuracy, comparison, and carryovers for current year return.

2. Collect taxpayers biographical information (e.g., date of birth, age, marital status, citizenship, dependents).

3. Determine filing status.

4. Determine all sources of taxable and non-taxable income (e.g., wages, interest, business, sale of property, dividends, rental income, income from flow-through
entities, alimony, government payments, and pension distributions).

5. Determine applicable adjustments to gross income (e.g., self-employed health
insurance, self-employment tax, student loan interest deduction, alimony paid,
tuition, and fees deduction).

6. Determine standard deduction and Schedule A itemized deductions (e.g., state and
local tax, real estate tax, cash contributions, non-cash contributions, unreimbursed
employee expense, medical expense, and mortgage interest).

7. Determine applicable credits (e.g., Earned Income Tax Credit, child tax credit,
education, retirement savings, dependent and childcare credit).

8. Understand tax payments (e.g., withholding, estimated payments).

9. Recognize items that will affect future returns (e.g., carryovers, depreciation).

10. Determine special filing requirements (e.g., presidentially declared disaster areas).

11. Determine filing requirements (including extensions and amended returns).

12. Understand due dates, including extensions.

13. Determine personal exemptions, including dependents.

14. Determine qualifying child/relative tests for Earned Income Credit.

Domain 2 – Treatment of Income and Assets

A. Income

1. Taxability of wages, salaries, tips, and other earnings (e.g., W-2 Wage and Tax Statement, cash).

2. Interest income (taxable and non-taxable) (e.g., Schedule B and 1099-INT).

3. Dividend income (e.g., Schedule B and 1099-DIV).

4. Self-employment income and expenses (e.g., Schedule C Profit or Loss From Business and Form 1099-MISC Miscellaneous Income, cash).

5. Rental income and expenses (e.g., Schedule E Supplemental Income and Loss).

6. Identification of forgiveness of debt as income (including Form 1099-C Cancellation of Debt).

7. Other income (e.g., alimony, barter income, hobby income, non-taxable combat pay, state income tax refund from prior years, prizes).

B. Retirement income

1. Reporting requirements of Social Security benefits (e.g., Form SSA-1099 Social Security Benefit Statement).

2. Taxable distribution from an IRA including basis in an IRA (e.g., Form 8606 Non-deductible IRAs).

3. Distributions from qualified plans (e.g., 401k, IRA, Roth IRA).

4. Required minimum distributions from retirement plans.

C. Property, real and personal

1. Short-term and long-term capital gains and losses (e.g., Schedule D Capital
Gains and Losses, Form 1099-B Proceeds from Broker and Barter Exchange
Transactions).

2. Determination of basis of assets (e.g., purchased, gifted, or inherited).

3. Sale of non-business assets (gains or losses).

4. Sale of a principal residence (e.g., IRC 121 exclusions, 1099S Proceeds From
Real Estate Transactions).

D. Adjustments to income

1. Self-employment tax (e.g., Schedule SE Self-Employment Tax).

2. Tuition and fees (e.g., Form 8917 Tuition and Fees Deduction, Form 1098T
Tuition Statement).

3. Eligible Moving expenses (e.g., Form 3903 Moving Expenses).

4. Other adjustments to income (e.g., IRA contribution deduction).

Domain 3 – Deductions and Credits

A. Itemized deductions

1. Medical and dental expenses.

2. State, local, and real estate taxes.

3. Mortgage interest expense (e.g., Form 1098 Mortgage Interest Statement).

4. Charitable contributions (e.g., cash, non-cash, Form 8283 Non-Cash Charitable
Contributions).

5. Miscellaneous itemized deductions (including deductions subject to 2% AGI
Limit).

6. Employee travel, transportation, education, and entertainment expenses (e.g.,
Form 2106-EZ and Form 2106 Unreimbursed Employee Business Expenses).

B. Credits

1. Child and dependent care credit (e.g., Form 2441 Child and Dependent Care
Expenses).

2. Child Tax Credit and Additional Child Tax Credit (e.g., Form 8812,
Additional Child Tax Credit).

3. Education credits (e.g., Form 8863 Education Credits (American Opportunity
and Lifetime Learning Credits), Form 1098T Tuition Statement).

4. Earned Income Tax Credit (EITC) (e.g., Schedule EIC Earned Income Credit,
Form 8867 Paid Preparers Earned Income Credit Checklist).

5. Retirement savings contribution credit (e.g., Form 8880 Credit for Qualified
Retirement Savings Contributions).

Domain 4 – Other Taxes

1. Alternative Minimum Tax (e.g., Form 6251 Alternative Minimum Tax).

2. Early distributions from retirement plans (e.g., Form 5329 Additional Tax on
Qualified Plans).

3. Self-employment tax (e.g., Schedule SE Self-Employment Tax).

4. Unreported Social Security and Medicare tax (e.g., Form 4137 Social Security and
Medicare Tax on Unreported Tip Income).

5. Repayment of first-time homebuyer credit (including Form 5405 First-Time
Homebuyer Credit and Repayment of the Credit).

Domain 5 – Completion of the Filing Process

1. Check return for completeness and accuracy.

2. Explain and review tax return.

3. Explain record-keeping requirements to the taxpayer.

4. Discuss significance of signatures (e.g., joint and several liability, penalty of
perjury, Form 8879 IRS e-file Signature Authorization).

5. Understand tax preparer's responsibilities related to rejected electronic returns.

6. Understand timeframe for submitting electronic returns (e.g., Form 8879 taxpayer
signature and date prior to submission).

7. Understand payment options (e.g., check, direct debit, EFTPS, credit card,
installment agreement-Form 9465).

8. Understand estimated tax payment requirements (e.g., potential for penalties,
Form 1040-ES Estimated Tax).

9. Understand refund options (e.g., Form 8888 Allocation of Refund).

Domain 6 – Practices and Procedures

1. Penalties to be assessed by the IRS against a preparer for negligent or intentional
disregard of rules and regulations, and for a willful understatement of liability
(e.g., IRC 6694(a), IRC 6694(b)).

2. Appropriate use of Form 8867 Paid Preparers Earned Income Credit Checklist and
related penalty for failure to exercise due diligence (e.g., IRC 6695(g)).

3. Furnishing a copy of a return to a taxpayer (e.g., IRC 6695(a)).

4. Signing returns and furnishing identifying (PTIN) numbers (e.g., IRC 6695(b),
IRC 6695(c)).

5. Rules for the return preparer for keeping copies and/or lists of returns prepared
(e.g., IRC 6695(d)).

6. Compliance with e-file procedures (e.g., timing of taxpayer signature, timing of
filing, recordkeeping, prohibited filing with pay stub).

7. Completion and use of Form 2848 Power of Attorney and Declaration of
Representative and Form 8821 Tax Information Authorization.

8. Safeguarding taxpayer information (e.g., Publication 4600 Safeguarding Taxpayer
Information, Quick Reference Guide for Business, IRC 7216).

Domain 7 – Ethics

Circular 230 Subparts A, B, and C (excluding D, E), covering syllabus including, but not
limited to, the following:

1. Preparers due diligence for accuracy of representations made to clients and IRS;
reliance on third-party work products (Circular 230, section 10.22).

2. What constitutes practice before the IRS and categories of individuals who may
practice (Circular 230, sections 10.2(a)(4) and 10.3).

3. Limits on practice by a registered tax return preparer (Circular 230, section
10.3(f)).

4. Requirement to furnish information to IRS upon request (Circular 230, section
10.20).

5. Prompt disposition of matters before the IRS (Circular 230, section 10.23).

6. Prohibition on receiving assistance from or providing assistance to disciplined
practitioners (Circular 230, section 10.24).

7. Rules regarding fees, including contingent fees (Circular 230, section 10.27).

8. Rules in dealing with clients, including return of client records, conflicts of interest,
advising on omissions and errors, solicitation (including advertising), and
negotiation of taxpayer refund checks (Circular 230, sections 10.21, 10.28, 10.29,
10.30, and 10.31).

9. Due diligence standards with respect to tax returns and other documents;
standards for signing, advising positions on returns and advising submissions of
other documents; advising on penalties; good faith reliance on client information;
reasonable inquiries regarding incomplete, inconsistent, incorrect information
(Circular 230, sections 10.34 and 10.35).

10. Responsibility of individual(s) who have principal authority over a firms tax
practices (Circular 230, section 10.36).

11. Incompetence and disreputable conduct that can result in disciplinary proceedings
(Circular 230, sections 10.51 and 10.52).

12. Sanctions that may be imposed under Circular 230 (Circular 230, sections 10.50
and 10.60).

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IRS
RTRP
Registered Tax Return Preparer
https://killexams.com/pass4sure/exam-detail/RTRP
RTRP
QUESTION: 96
In the event an applicant for registered tax return preparer status is denied enrollment,
(s)he may file an appeal of that decision with the Deputy Commissioner of the Internal
Revenue Service.
A. True.
B. False.
Answer: B
An applicant who is denied enrollment may, within 30 days after receipt of the notice of
denial, file a written appeal to the Secretary of the Treasury. A decision on the appeal will
be rendered by the Secretary of Treasury as soon as practicable.
QUESTION: 97
Mike, age 30, and his daughter lived with Mike�s mother during the year. Mike�s earned
income and adjusted gross income for the year was $4,000. The mother�s adjusted gross
income for the year was $37,000. Assuming that the daughter is a qualifying child for
both Mike and his mother, which of the following statements is true with regard to the
Earned Income Credit?
A. Since the daughter is a qualifying child for both Mike and his mother, they both can
claim the credit providing they allocate the earned income.
B. Neither can claim the credit.
C. Mike can claim the credit since he is the parent, and his mother�s adjusted gross
income exceeds the limit for the year.
D. Mike�s mother can claim the credit because her adjusted gross income is more than
Mike�s.
Answer: C
The Earned Income Credit is a refundable tax credit for low-income taxpayers under Sec.
32. The credit is based on a taxpayer�s earned income subject to certain limitations. An
individual is eligible for the Earned Income Credit if (s)he has a qualifying child for the
tax year or does not have a qualifying child for the tax year and (1) has a principal place
of abode in the United States for more than one-half of the tax year, (2) has attained age
25 but not age 65 before the close of the tax year, and (3) is not a dependent of another
taxpayer for any tax year beginning in the same calendar year. A qualifying child is one
who bears the necessary relationship to the taxpayer, has the same principal place of
abode as the taxpayer for more than one-half of the tax year, and meets the requisite age
41
RTRP
requirements, and one for whom the necessary identification requirements are satisfied. If
more than one person has the same qualifying child, then the parent is given priority to
claim the credit.
QUESTION: 98
Which of the following is false?
A. A taxpayer who is a qualified child of another person cannot claim the EIC.
B. You cannot claim the Earned Income Credit if you do not have a SSN.
C. You can claim the Earned Income Credit with an ITIN.
D. You are not allowed the Earned Income Credit if you are married filing separately.
Answer: C
Individual Tax Identification Numbers (ITINs) disqualify the taxpayer and/or the
otherwise qualifying child (QC) from the credit.
QUESTION: 99
A taxpayer should itemize deductions if the taxpayer�s total itemized deductions are
A. Less than the taxpayer�s interest income.
B. More than the taxpayer�s standard deduction.
C. Equal to the taxpayer�s self-employment tax.
D. Double the taxpayer�s unemployment compensation.
Answer: B
A person itemizes deductions if the total allowable itemized deductions, after all limits
have been applied, is greater than the standard deduction. A person must elect to itemize,
or no itemized deductions will be allowed.
QUESTION: 100
Where is unreported tip income reported as income?
A. Schedule D.
B. Schedule B.
C. Schedule A.
D. Line 7 of Form 1040.
42
RTRP
Answer: D
Unreported tip income as calculated on Form 4137, Social Security and Medicare Tax on
Unreported Tip Income, line 4, will also increase Form 1040 line 7.
QUESTION: 101
Which of the following statements is false regarding registered tax return preparers?
A. Practice is limited to preparing and signing tax returns and claims for refund and other
documents for submission to the Internal Revenue Service.
B. They may represent taxpayers before revenue agents, customer service representatives,
or similar officers and employees of the Internal Revenue Service during an examination
if the registered tax return preparer signed the tax return.
C. They are subject to the provisions of Circular 230 in the same manner as attorneys,
certified public accountants, enrolled agents, enrolled retirement plan agents, and
enrolled actuaries.
D. They may represent taxpayers before appeals officers, revenue officers, counsel, or
similar officers or employees of the Internal Revenue Service or the Treasury
Department.
Answer: D
A registered tax return preparer may not represent taxpayers before appeals officers,
revenue officers, counsel, or similar officers or employees of the Internal Revenue
Service or the Treasury Department.
QUESTION: 102
If the IRS rejects the electronic portion of a taxpayer�s individual income tax return for
processing, and the ERO cannot rectify the reason for the rejection, the ERO must take
reasonable steps to inform the taxpayer of the rejection within 48 hours.
A. True.
B. False.
Answer: B
If the IRS rejects the electronic portion of a taxpayer�s return and the reason for the
rejection cannot be rectified by the actions described in Revenue Procedure 98-50, the
ERO must take reasonable steps to inform the taxpayer that the taxpayer�s return has not
been filed within 24 hours of receiving the rejection.
43
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