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IRS Special Enrollment Examination (SEE) for Enrolled Agents

4. Filing process: practice questions

Our Enrolled Agent (SEE) bank has 29 questions on this topic. Here are 5 of them with answers; the full mock exam draws from every topic, like the real one.

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Question 1

Before transmitting a return, a preparer reviewing software output notices the same Form W-2 entered twice. Under Circular 230 due diligence, the preparer should:

  1. Let the IRS find it and correct it with a math error notice
  2. Transmit it as is, because the software already checked the entries
  3. Correct the duplicate entry, since the preparer remains responsible for accuracy
  4. Ask the client to fix it after filing
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C. Correct the duplicate entry, since the preparer remains responsible for accuracy — Reliance on software does not relieve the preparer of due diligence. Returns should be reviewed for errors such as duplicate entries and miscalculations before filing.

Question 2

Under the FTC Safeguards Rule, a tax preparation business must:

  1. Maintain a written information security plan to protect client data
  2. Encrypt data only on paper files kept in the office
  3. Get IRS approval for its software
  4. Report the names of all clients to the FTC and to the IRS each year
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A. Maintain a written information security plan to protect client data — Tax professionals are financial institutions under the Gramm-Leach-Bliley Act and must have a written information security plan (WISP). Pub. 4557 and Pub. 5708 explain how.

Question 3

To remain in the e-file program, providers must:

  1. Pay an annual fee to the IRS
  2. Keep their e-file application current, comply with tax obligations and follow Pub. 1345 rules
  3. Re-apply every year
  4. File at least 100 returns a year
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B. Keep their e-file application current, comply with tax obligations and follow Pub. 1345 rules — Continued participation requires updating the application within 30 days of changes, staying tax compliant and following program rules; the IRS monitors providers.

Question 4

How long must an ERO keep Forms 8879?

  1. Until the next filing season
  2. 4 years from the date the return was transmitted to the IRS, or 6 if a refund is claimed
  3. 3 years from the return due date or IRS received date, whichever is later
  4. 1 year
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C. 3 years from the return due date or IRS received date, whichever is later — Publication 1345 requires keeping Forms 8878 and 8879 for 3 years from the later of the due date or the IRS received date.

Question 5

An ERO must provide the taxpayer with a copy of the return and:

  1. The ERO's EFIN application and its IRS acceptance letter
  2. Information about the return's acknowledgment and any refund delay
  3. Copies of all other clients' returns
  4. The IRS's audit selection criteria and scores for that type of return
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B. Information about the return's acknowledgment and any refund delay — EROs must give the taxpayer a complete copy of the return and should advise them about acknowledgment and refund timing, including refund-related products.

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