.$9,945 3. Sam Gambello, a prominent organized crime figure, has his income tax
ID: 2329900 • Letter: #
Question
.$9,945 3. Sam Gambello, a prominent organized crime figure, has his income tax return prepared by Warren Hal. Warren knows of Sam's activities, but at Sam's direction, he does not report any of Sam's crime-related income on Sam's tax return. Will Warren be liable for a federal tax penalty and why or why not? a. Yes, based upon his disregard of tax regulations concerning the amount of gross income to be reported. b. No, since he merely followed Sam's instructions c. Yes, and as part of a conspiracy to evade taxes, he will have to pay the tax due on Sam's unreported income if Sam does not pay it. d. No, since as a return preparer, he is not responsible for the accuracy of the return e. Warre n may be subject to a federal tax penalty depending on the amount of the crime-related income involved.Explanation / Answer
Answer-d. no., he is not responsible for the accuracy of the return since he is a tax return preparer.
Since tax return preparer is not the auditor, he is not responsible for the accuracy of details provided by assessed.
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