CPA Regulation (REG) Section Practice Test
Build your confidence for CPA Regulation (REG) Section. Practice the concepts, understand the answers, and strengthen your knowledge one question at a time.
Try a sample questionExam overview and details
The CPA Regulation (REG) section is a core component of the Uniform CPA Examination, assessing a candidate's comprehensive knowledge and application skills in federal taxation, business law, and professional ethics. This section validates a CPA's ability to navigate the complex regulatory environment governing business entities and individual taxpayers. Successful completion demonstrates mastery of tax procedures, entity taxation (C corporations, S corporations, partnerships, trusts, and estates), property transactions, and the legal framework of commercial transactions. The REG certification signifies that a professional possesses the authoritative expertise required to ensure compliance, optimize tax strategies, and provide critical advisory services. In today's stringent regulatory climate, this credential is indispensable for accountants providing audit, assurance, and consulting services, directly impacting financial reporting integrity and strategic business decision-making.
Sample Questions
Choose an answer and explore the explanation to see how practice works.
Magnolia Inc. timely filed its 2021 federal income tax return on March 15, 2022, reporting gross income of $2,400,000. The IRS later discovered Magnolia omitted $700,000 of gross income (no fraud). What is the latest date the IRS may assess additional tax?
Brennan, a paid tax preparer, signs a 2024 return knowing it takes an aggressive deduction position with only a 25% chance of being sustained on the merits. The position is NOT disclosed on Form 8275. Brennan earned $4,200 preparing the return. The IRS later disallows the position. What is Brennan's potential preparer penalty under IRC Section 6694?
Margot earns $9,000 selling handcrafted candles in 2024. The IRS classifies the activity as a "hobby" under IRC Section 183 (not engaged in for profit). She incurred $5,000 of expenses (otherwise deductible if a trade or business). For 2024, what is Margot's federal tax treatment?
Lila, a CPA, gives confidential federal tax advice to her client Hartwell Industries regarding a Schedule UTP position. The IRS later seeks the advice. Under IRC Section 7525, the federally authorized tax practitioner-client privilege:
Marcus, an accountant with mild cerebral palsy affecting fine-motor coordination, applies for a senior auditor role at Beacon CPAs, which has 22 employees. Marcus can perform all essential job functions if given a touchscreen workstation (cost: $850) and an extra 15 minutes to print and review hard-copy workpapers. Beacon refuses to hire him, citing the modifications. Has Beacon violated the ADA?
Career Opportunities & Salary
Exam insights and study advice
Mastery of the REG section is non-negotiable for career advancement in public accounting, corporate finance, and tax advisory roles. It is the definitive benchmark for technical competence in U.S. tax law and regulation, granting immediate industry recognition and credibility with clients, employers, and regulatory bodies. This certification opens doors to specialized positions in tax consulting, compliance leadership, and forensic accounting, while forming the essential legal and ethical foundation required for the CPA license-a prerequisite for signing audit opinions and holding key fiduciary roles.
Recommended
These are the backgrounds the certifying body suggests. Check the vendor's own page for anything it formally requires.
What this exam covers
Use the published domain weights to plan your study. Practice results do not predict your certification exam score.