Preview Questions Tax Lawyer | Role Specific Skill

Question 1: In tax litigation, what is the significance of "tax assessments"?

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They are used to invalidate tax claims in court

They serve as the final ruling of a tax dispute

They are only applicable to corporate taxes

They are preliminary determinations made by the IRS or tax authority of the amount owed

Question 2: How should a Tax Lawyer handle tax issues related to the tax treatment of stock options in tax planning?

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By advising stock options only for high-level employees without analyzing tax implications

By assuming stock options are always beneficial for tax purposes

By treating stock options the same as regular income without considering tax consequences

By evaluating the tax consequences for both the corporation (deductions) and the employee (ordinary income vs. capital gains) and structuring accordingly

Question 3: What is the "unilateral tax credit" in international tax law?

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A credit granted to foreign corporations for taxes paid to their home country

A credit provided by a country to reduce double taxation of foreign income

A credit given to individual taxpayers for foreign tax paid on non-passive income

A tax exemption granted for foreign subsidiaries of domestic firms

Question 4: What is a "like-kind exchange" and how does it relate to tax planning?

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It provides a direct tax credit for property exchanges

It is a method to lower income tax rates

It allows taxpayers to exchange property of the same type without triggering capital gains taxes

It enables taxpayers to delay estate taxes on real estate transactions

Question 5: In the context of corporate taxation, what is the "earned income tax credit" (EITC)?

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A tax credit for companies that invest in renewable energy

A tax credit given to corporations that produce a high volume of exports

A tax credit available to individuals based on their earnings

A corporate tax credit designed to reduce tax liability on foreign earnings

Question 6: How should a Tax Lawyer navigate "taxation of foreign income" under U.S. tax laws, particularly for U.S. residents with international investments?

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Disregard the tax treaty benefits and assume U.S. tax laws apply uniformly to foreign income

Assume foreign income is not subject to U.S. tax if the income is taxed in the foreign jurisdiction

Focus only on the foreign taxes paid, ignoring U.S. reporting requirements for foreign income

Ensure compliance with the Foreign Account Tax Compliance Act (FATCA), review tax treaties, and properly report foreign income under IRS regulations