SEE - Special Enrollment Exam Quiz: Return Document Collection
15 questions · exam conditions
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Return Document CollectionQuestion 1 of 15

A client's daughter was a third-year undergraduate in 2025. The university has not issued Form 1098-T because of a system problem. In February 2026, the daughter requested the form from the university and has cooperated with its efforts to issue it, but it still has not been provided. The client has an itemized tuition billing statement, credit card receipts showing payment of $4,500 to the university, and receipts for $700 of required textbooks. The client wants to claim the American opportunity tax credit.

Assuming the client is otherwise eligible for the credit, which of the following is correct regarding the documentation for the credit?

The tuition billing statement, payment receipts, and textbook receipts are sufficient substantiation, so the return does not need to wait for Form 1098-T.
The client should attach the billing statement and receipts to the return, because the IRS requires substitute documentation to be filed with Form 8863.
The $700 of required textbooks may be included only if they were purchased from the university, because only bookstore purchases qualify as course materials for this credit.
The itemized tuition billing statement alone is enough to claim the credit because tuition is considered paid when it is billed, so the payment receipts are unnecessary.
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SEE - Special Enrollment Exam Quiz

SEE - Special Enrollment Exam Quiz: Return Document Collection

Practice Return Document Collection in SEE - Special Enrollment Exam with focused quiz questions that help you check what you know, review explanations, and build confidence with test-style prompts.

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This quiz focuses on Return Document Collection, giving you a quick way to practice the rules, question types, and explanations that matter most for SEE - Special Enrollment Exam.

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Question 1

A client's daughter was a third-year undergraduate in 2025. The university has not issued Form 1098-T because of a system problem. In February 2026, the daughter requested the form from the university and has cooperated with its efforts to issue it, but it still has not been provided. The client has an itemized tuition billing statement, credit card receipts showing payment of $4,500 to the university, and receipts for $700 of required textbooks. The client wants to claim the American opportunity tax credit.

Assuming the client is otherwise eligible for the credit, which of the following is correct regarding the documentation for the credit?

  1. The tuition billing statement, payment receipts, and textbook receipts are sufficient substantiation, so the return does not need to wait for Form 1098-T. (correct answer)
  2. The client should attach the billing statement and receipts to the return, because the IRS requires substitute documentation to be filed with Form 8863.
  3. The $700 of required textbooks may be included only if they were purchased from the university, because only bookstore purchases qualify as course materials for this credit.
  4. The itemized tuition billing statement alone is enough to claim the credit because tuition is considered paid when it is billed, so the payment receipts are unnecessary.
Explanation: IRC § 25A(b) and (g)(8); Instructions for Form 8863. The American opportunity tax credit generally requires that the taxpayer or the student have received Form 1098-T. The Form 8863 instructions make an exception when the institution was required to furnish the form but did not: the credit may still be claimed if, after January 31 and before filing, the taxpayer or student requested the form, cooperated with the institution's efforts to issue it, and can substantiate enrollment and the qualified expenses paid. The daughter made that request, and the billing statement, payment receipts and textbook receipts substantiate the expenses, including the required course materials, so the return need not wait for Form 1098-T. Choice A is correct. Choice B is wrong because substantiating documents are not attached to the return; they are kept and provided if the IRS asks for them. Choice C is wrong because required books, supplies and equipment are qualified expenses for the American opportunity tax credit wherever they are bought; no rule requires buying them from the university. Choice D is wrong because the credit is based on qualified expenses paid during the year, and a billing statement alone does not show payment.

Question 2

Which of the following is correct regarding the document needed to reconcile advance payments of the premium tax credit for a taxpayer who was enrolled in a Marketplace plan for 2025?

  1. Form 1095-A, issued by the Marketplace, shows the monthly enrollment premiums and advance credit payments and is used to complete Form 8962. (correct answer)
  2. Form 1095-B, issued by the insurer, shows the advance credit payments and is required to calculate the premium tax credit.
  3. Form 1095-C, issued by the employer, reports the employee's monthly advance premium payments and must be attached to Form 8962.
  4. The insurer's monthly billing statements are sufficient, because the Marketplace does not issue a tax form unless the taxpayer requests one.
Explanation: IRC § 36B(f)(3) and the Instructions to Form 1095-A govern this point: the Marketplace furnishes Form 1095-A, which reports the monthly enrollment premiums and the monthly advance payment of the premium tax credit, and the taxpayer uses that information to complete Form 8962. Choice B misstates the form and its contents: Form 1095-B reports minimum essential coverage and does not report advance credit payments. Choice C misstates the source: Form 1095-C reports employer-sponsored coverage offers, not Marketplace advance payments, and it is not attached to Form 8962. Choice D misstates the records: monthly billing statements are not an acceptable substitute for Form 1095-A when reconciling the premium tax credit.

Question 3

Which of the following is correct regarding the documentation and reporting required when a taxpayer does not receive a Form W-2 in time to file a return for tax year 2025?

  1. The taxpayer should ask the employer for the form and, if it is still not received, file Form 4852 as a substitute; an amended return may be needed if the actual Form W-2 later shows different amounts. (correct answer)
  2. The taxpayer should file an extension and wait for the actual Form W-2 before filing, because the IRS will not accept a return unless a copy of the actual Form W-2 is attached to it.
  3. The taxpayer should report zero wages and zero withholding on the return, because wages are not taxable to the taxpayer until the employer issues a Form W-2 for the year.
  4. The taxpayer should use the prior year's Form W-2 from the same employer, because the IRS generally accepts prior-year amounts as a reasonable estimate when the current-year form is missing.
Explanation: Under IRC § 6051 and the Instructions for Form 4852, an employer must furnish a Form W-2, but a taxpayer who has made a reasonable effort and still has not received it may file a substitute Form 4852 based on the best available information; if the actual Form W-2 later shows different amounts, an amended return may be necessary. Choice A is therefore correct. Choice B misstates the filing requirement: the IRS accepts a return filed with Form 4852 in place of the actual Form W-2, and filing an extension is not required. Choice C misstates the income tax rule: wages are taxable when received regardless of whether the employer issues a Form W-2. Choice D misstates the substitute method: the estimate must be based on current-year records, not the prior year's Form W-2.

Question 4

Which of the following is correct regarding the records a taxpayer who purchased a principal residence needs to substantiate the adjusted basis and the amount realized on its 2025 sale for purposes of the section 121 exclusion?

  1. The taxpayer can determine the excluded gain from the Form 1099-S and the sale settlement statement, because the exclusion is based on the sales proceeds and the taxpayer's filing status.
  2. The taxpayer needs the closing statements from the purchase and sale, records of capital improvements, and proof of the purchase price; a Form 1099-S reports gross proceeds, not basis. (correct answer)
  3. The taxpayer needs only the original purchase price and the sale price, because improvements to a principal residence are not added to basis for purposes of the exclusion.
  4. The taxpayer can rely on the property tax bills and mortgage interest statements from the ownership period, because those records establish both the amount realized and the adjusted basis.
Explanation: Choice B is correct. IRC § 121 permits a taxpayer to exclude gain from the sale of a principal residence, but the taxpayer must know both the amount realized and the adjusted basis. Closing statements show the purchase and sale prices and selling expenses; improvement records increase basis. Form 1099-S reports gross proceeds, not basis. Choice A misstates the rule: the amount excludable under § 121 is limited to the gain realized, so the taxpayer must know the gain; it cannot be determined solely from sales proceeds and filing status. Choice C misstates basis: capital improvements generally increase adjusted basis. Choice D misstates the records: property tax bills and mortgage interest statements do not establish the amount realized or the adjusted basis.

Question 5

Which of the following is correct regarding the documentation needed to determine whether a taxpayer's 22-year-old daughter, who is not a full-time student and is not permanently and totally disabled, can be claimed as a qualifying relative for 2025?

  1. The taxpayer should keep the daughter's pay stubs to show that her wages were less than $5,200, because only earned income counts toward the gross income test for a qualifying relative.
  2. The taxpayer should keep the daughter's income records, such as Forms W-2, 1099-INT, and 1099-DIV, to confirm gross income less than $5,200, and support payment records to show that the taxpayer provided more than half of her support. (correct answer)
  3. The taxpayer should keep the daughter's bank statements to show that she spent less than $5,200 on her own support, because the $5,200 limit is based on support rather than income.
  4. The taxpayer should obtain the daughter's Form 1040 to verify that her adjusted gross income was less than $5,200, because adjusted gross income is the statutory measure for the gross income test.
Explanation: Choice B is correct. Under IRC § 152(d)(1)(B) and (C), a qualifying relative must have gross income less than the annual limit ($5,200 for 2025) and must receive more than half of her support from the taxpayer. Income records such as Forms W-2, 1099-INT, and 1099-DIV evidence gross income, and support payment records evidence the taxpayer's support contributions. Choice A misstates the measure: the gross income test uses all gross income, not only earned income. Choice C misstates the test: the $5,200 limit applies to gross income, not to the amount the individual spent on her own support. Choice D misstates the measure: the statutory test uses gross income, not adjusted gross income.

Question 6

Which of the following is correct regarding the information a taxpayer needs to report a distribution from a qualified tuition program on a 2025 return?

  1. The taxpayer needs only Form 1098-T, because a qualified tuition program distribution is reported on that form and Form 1099-Q goes only to the designated beneficiary.
  2. The taxpayer needs only Form 1099-Q, because earnings on a qualified tuition program distribution are not taxable if the distribution was used for tuition during the year.
  3. The taxpayer needs Form 1099-Q and records of qualified education expenses, such as Form 1098-T; the taxable earnings are the earnings allocated to the distribution not covered by those expenses. (correct answer)
  4. The taxpayer needs Form 1099-Q and Form 1098-E; the taxable amount is the distributed earnings reduced by any student loan interest paid during the year.
Explanation: Choice C is correct. Under IRC § 529 and Pub. 970, the taxable portion of a qualified tuition program distribution is the earnings allocated to the distribution that are not offset by qualified education expenses. The taxpayer substantiates those expenses with records such as Form 1098-T, along with Form 1099-Q showing the distribution. Choice B is incorrect because tax-free treatment is not automatic merely because the distribution was used for tuition; the distribution must be compared with qualified education expenses. Choice A is incorrect because a qualified tuition program distribution is not reported on Form 1098-T, and Form 1099-Q is furnished to the distributee, or to both the distributee and the designated beneficiary when they are different, not only to the designated beneficiary. Choice D is incorrect because Form 1098-E reports student loan interest, which does not reduce the taxable portion of a qualified tuition program distribution.

Question 7

A client had Marketplace coverage for all of 2025 and received advance payments of the premium tax credit. The paper Form 1095-A was mailed to an old address and the client does not have it, but the same monthly premium and advance credit information is visible when the client logs in to the Marketplace account. The client asks whether the return can be prepared now.

Which of the following is correct for preparing Form 8962?

  1. The client may rely on a written summary from the insurer because the insurer is the source of the monthly premium amounts and is required to keep those records.
  2. The agent should prepare Form 8962 from the client's bank records showing the advance credit payments and ignore the missing form because the amounts are certain.
  3. The client must wait until the IRS sends a transcript of the Form 1095-A before the return can be filed, even if the Marketplace account shows the data.
  4. The agent may use the information from the Marketplace account and should make sure the client has a copy of Form 1095-A; an insurer statement is not a substitute. (correct answer)
Explanation: IRC §36B and Form 8962 instructions: The premium tax credit reconciliation must be based on the monthly enrollment premiums and advance credit payments reported on Form 1095-A. If the paper form was lost, the taxpayer can obtain the form through the Marketplace account, and this information may be used. Choice A is wrong because an insurer's statement is not the Marketplace's official statement and may not show APTC. Choice B is wrong because bank records do not establish the APTC amounts that were paid on the client's behalf. Choice C is wrong because the client need not wait for an IRS-generated transcript before filing.

Question 8

A client paid a licensed daycare center $8,200 in 2025 for care of her two children, ages 3 and 6, while she worked. The center has not given her an end-of-year statement, and the director will not provide the center's employer identification number. The client has canceled checks and a signed acknowledgment from the center describing the periods of care.

Which of the following is correct for claiming the child and dependent care credit?

  1. The canceled checks and signed acknowledgment are sufficient, because Form 2441 requires the caregiver's name and the amount paid but not the provider's taxpayer identification number.
  2. The credit is not available unless the center provides its employer identification number before the return is filed, even if the client has receipts and a signed acknowledgment.
  3. The client must report the payments as income to the center and attach a Form 1099-MISC to the return before claiming the credit.
  4. The client should request the center's EIN using Form W-10; if the center refuses, the credit may still be claimed if the client documents the refusal and the attempt to obtain the EIN. (correct answer)
Explanation: IRC §21 and Form 2441 instructions: A taxpayer claiming the child and dependent care credit must identify the care provider by name, address, and TIN. If the provider will not give the TIN, the taxpayer may still claim the credit after making a reasonable, documented effort to obtain it, and Form W-10 is an appropriate request form. Choice A is wrong because Form 2441 does require provider identifying information. Choice B is wrong because refusal alone does not automatically bar the credit if due diligence is shown. Choice C is wrong because the taxpayer does not attach Form 1099-MISC to the return and the center's reporting obligation is separate.

Question 9

A client won $10,000 at a casino in 2025 and received Form W-2G. This was the client's only gambling winnings for 2025. The client itemizes deductions. The client also kept a daily gambling diary with the date, casino, amounts won and lost, and persons present, and kept receipts for the losing sessions; the diary and receipts show $12,500 of losses for 2025. The client wants to claim the maximum gambling loss deduction.

Which of the following is correct for the return?

  1. Report the $10,000 as other income and deduct the $12,500 as an itemized deduction; the diary is a contemporaneous record of all gambling activity.
  2. Do not report winnings that are not shown on a Form W-2G; the diary is sufficient to offset the $10,000 shown on the form.
  3. Report the $10,000 on Schedule C as gambling income and deduct $10,000 of losses; keeping records makes gambling a business for tax purposes.
  4. Report the $10,000 as other income and deduct $10,000 of losses as an itemized deduction; the diary and receipts substantiate losses up to, but not exceeding, winnings. (correct answer)
Explanation: IRC §165(d): A taxpayer who gambles outside a trade or business may deduct wagering losses only to the extent of wagering gains, and only if the taxpayer itemizes. Gambling winnings are reported as other income, and a Form W-2G is not the only evidence of winnings. Here, total winnings are $10,000 and substantiated losses are $12,500, so the maximum itemized deduction is $10,000. Choice D is correct. Choice A is wrong because it would deduct $12,500, exceeding the $10,000 of winnings. Choice B is wrong because gambling winnings are taxable even if no Form W-2G is issued. Choice C is wrong because these facts describe recreational gambling, not a Schedule C trade or business; keeping records alone does not make gambling a business.

Question 10

A client had an online resale business in 2025. One payment platform issued Form 1099-K showing $21,500 of payments from 210 transactions. A second platform did not issue Form 1099-K because the client had 180 transactions totaling $13,000. The client proposes to report only the $21,500 because no form was received for the second platform.

Which of the following is correct for preparing Schedule C?

  1. Report only the $21,500 from the Form 1099-K because the second platform was not required to report and the IRS will not know about those sales.
  2. Report the combined $34,500, then subtract platform fees and refunds before entering gross receipts on Schedule C because Form 1099-K amounts are net.
  3. Obtain transaction reports from both platforms and reconcile them with bank deposits; report the $21,500 plus the $13,000 of business receipts, and deduct allowable expenses. (correct answer)
  4. Wait until the second platform issues a Form 1099-K; no income from that platform is reportable until an information return is actually received.
Explanation: IRC §61 and Schedule C instructions: All business receipts are taxable, whether or not an information return is issued. The $13,000 from the second platform must be reported even though no Form 1099-K was issued for it. The agent should obtain transaction reports and reconcile them to bank deposits, and deduct expenses separately. Choice A is wrong because the absence of a form does not make income nontaxable. Choice B is wrong because platform fees are expenses, not a subtraction from gross receipts, and the 1099-K reporting threshold does not change the income rule. Choice D is wrong because a return may not be delayed merely because an information return has not been received.

Question 11

A client sold stock in 2025 that she inherited from her father, who died in 2024. The broker's Form 1099-B reports the sale proceeds but shows the cost basis as unavailable. The client has her father's original 1995 purchase confirmation and a brokerage statement from the date of death showing the stock's value.

What documentation should the enrolled agent use to determine basis?

  1. Use the father's 1995 purchase confirmation, because the stock's basis carries over from the decedent to the heir.
  2. Use the date-of-death brokerage statement, because inherited property generally takes a fair market value basis on the date of death. (correct answer)
  3. Use the 1995 purchase confirmation plus the sale proceeds from Form 1099-B, because gain is sale proceeds minus the decedent's cost.
  4. The date-of-death statement is irrelevant unless an estate tax return was filed; use the Form 1099-B proceeds as the basis if no estate tax return was filed.
Explanation: IRC §1014(a): Property acquired from a decedent generally has a basis equal to its fair market value on the date of death, or on the alternate valuation date if elected. The date-of-death brokerage statement is therefore the correct document. Choice A is wrong because it applies carryover basis, which is generally the rule for gifts, not bequests. Choice C is wrong for the same reason. Choice D is wrong because the step-up applies whether or not an estate tax return was required.

Question 12

A client sold her principal residence in 2025 and received Form 1099-S reporting the gross proceeds. She bought the home in 2000 and made several improvements over the years, but she no longer has all of the receipts. She expects the section 121 exclusion to cover the gain.

Which of the following is correct regarding the documents needed to prepare the return?

  1. The taxpayer must use the county property tax assessment as her basis when the original purchase records are unavailable and the home has been substantially improved.
  2. The Form 1099-S alone is enough to prepare the return because the section 121 exclusion eliminates the need to compute the gain.
  3. The taxpayer should collect the sale closing statement and the original purchase records and reconstruct improvement costs, which increase basis and reduce gain. (correct answer)
  4. Improvement receipts are irrelevant to the sale; only the closing statement is needed to report the transaction on the return.
Explanation: IRC § 121; Pub. 523, Selling Your Home. Gain on a home sale is amount realized minus adjusted basis, and the § 121 exclusion applies only after the gain is computed. Adjusted basis includes capital improvements, so the correct practice is to collect the sale closing statement, the original purchase/settlement records, and to reconstruct improvement costs. Choice A is wrong because a property tax assessment is not the taxpayer's cost basis. Choice B is wrong because the exclusion does not remove the need to compute basis and gain. Choice D is wrong because improvements increase basis and therefore reduce the gain reportable on the return.

Question 13

A client worked as a server until December 15, 2025, when the restaurant closed without notifying employees. The owner has not answered repeated calls or letters, and the client never received a 2025 Form W-2. The client has final pay stubs for the entire year and bank records showing the net paycheck deposits. She needs to file by April 15, 2026.

Which of the following is the correct way for the enrolled agent to prepare the return?

  1. Use the pay stubs and bank records to complete Form 4852, attach it to the return, and file an amended return if a later Form W-2 or W-2c shows different amounts. (correct answer)
  2. Wait until the IRS can produce a transcript from the employer's wage report, because a return cannot be filed using estimates from pay stubs or bank records.
  3. File the return using only the bank deposits as gross wages and attach a statement explaining that the employer failed to issue Form W-2 to the taxpayer.
  4. Request a copy of the employer's W-3 using Form 4506-T and use those amounts, because the W-3 is the authoritative substitute for a missing W-2.
Explanation: Form 4852 instructions: A taxpayer who cannot obtain Form W-2 after a reasonable effort must complete and attach Form 4852, using the best available data from pay stubs and bank records. If the actual W-2 or W-2c later arrives and shows different amounts, the taxpayer should file Form 1040-X. Choice B is wrong because the IRS transcript is not the required substitute and may not exist yet. Choice C is wrong because bank deposits alone do not show withholding and no substitute form is attached. Choice D is wrong because Form 4506-T does not produce the employer's W-3, and the W-3 is an aggregate filing, not a per-employee substitute.

Question 14

A mortgage lender will not accept transcripts and requires a complete copy of the client's signed 2024 Form 1040, including schedules and attachments. The client no longer has a copy of the return. The client asks which IRS form to use to obtain it.

Which of the following should the enrolled agent recommend?

  1. Form 4506-T, requesting a Tax Return Transcript, because it contains all line items from Form 1040 and is provided free of charge.
  2. Form 4506-T, requesting an Account Transcript, because lenders accept it as proof of the return as originally filed.
  3. Form 4506, requesting a copy of the tax return, because it will include the signed return, schedules, and attachments for a fee. (correct answer)
  4. Form 4506-T, requesting a Wage and Income Transcript, because it reproduces the W-2 and 1099 information used to prepare the return.
Explanation: Form 4506 instructions: A copy of the actual return, including schedules and attachments, is obtained by filing Form 4506, not by requesting a transcript. Form 4506-T transcripts are free but do not include every attachment and are not exact copies. Choice A is wrong because a Tax Return Transcript is not a copy of the return and may omit schedules. Choice B is wrong because an Account Transcript shows assessments, payments, and transactions, not the return as filed. Choice D is wrong because a Wage and Income Transcript is a list of information-return data, not a reproduction of the return.

Question 15

Which of the following is correct regarding the documentation required to determine the basis of stock that a taxpayer inherited and sold in 2025, when the Form 1099-B does not report basis?

  1. The taxpayer needs a copy of Form 706, because the IRS does not recognize a basis in inherited stock unless the basis was reported on an estate tax return.
  2. The taxpayer needs the decedent's original purchase confirmation, because a beneficiary generally takes the decedent's adjusted basis in inherited property.
  3. The taxpayer needs evidence of the stock's fair market value on the decedent's date of death, because inherited property generally takes a stepped-up basis for Federal income tax purposes. (correct answer)
  4. The taxpayer needs Form 1099-S from the estate, because that form reports the basis of inherited securities to the beneficiary.
Explanation: IRC § 1014(a). Property acquired from a decedent generally takes a basis equal to its fair market value on the date of death. Because the broker did not report basis, the taxpayer needs evidence of the stock's value on the date of death, such as a brokerage date-of-death valuation or the estate's valuation records. Choice C is correct. Choice A is wrong because the date-of-death value is the basis whether or not an estate tax return was filed; a Form 706 is not a condition of a stepped-up basis, and many estates are not required to file one. Choice B is wrong because inherited property generally takes a date-of-death basis, not a carryover of the decedent's adjusted basis, so the original purchase confirmation does not establish basis. Choice D is wrong because Form 1099-S reports proceeds from real estate transactions; it does not report the basis of inherited securities.