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CPA Tcp · Question of the Day

CPA Tcp Question of the Day

A fresh daily question to build accuracy, reinforce recall, and turn practice into a steady habit.
Friday, October 23, 2026

A taxpayer who improperly changed their accounting method without IRS consent may be subject to:

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Question of the Day

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A taxpayer who improperly changed their accounting method without IRS consent may be subject to:

  1. Only a $1,000 administrative fee for the unauthorized change.
  2. Automatic audit of all tax years affected by the improper method.
  3. The IRS having the authority to impose the proper method and require a Section 481(a) adjustment - potentially in a less favorable manner than a voluntary change would have produced. (correct answer)
  4. Criminal penalties for tax fraud.

Explanation: An unauthorized method change may be corrected by the IRS on audit in a less favorable manner than a voluntary change. Answer C is correct.