Please get back to me with the multiple answers to this question ASAP, thanks!

Discussion Question $2-4($LO$.2,5)$

Sonja Bishop operates a small international firm named Tile, Inc. A new treaty between the United States and Spain conflicts with a Section of the Internal Revenue Code. Sonja asks you for advice.

Question Content Area

a$.$If she follows the treaty position, does she need to disclose this on her tax return?

Disclosure is required any time a tax treaty overrides a tax law.Disclosure is required only if the tax position results in a tax liability greater than $$1,000.$

If she is required to disclose, are there any penalties for failure to disclose?

Yes.Yes, but only when the resulting tax liability is greater than $$1,000.$No$.$

Question Content Area

b$.$Complete the letter below, formally responding to Sonja.

SWFT$,$ LLP

$5191$ Natorp Boulevard

Mason, OH $45040$October $20,2022$Ms$.$ Sonja Bishop

Tile, Inc.

$100$ International Drive

Tampa, FL $33620$Dear Ms$.$ Bishop:This letter is in response to your request about information concerning a conflict between a U$.$S$.$ treaty with Spain and a Section of the Internal Revenue Code $($IRC$).$ The major reasons for treaties between the United States and certain foreign countries is to eliminate

double OR all? $($only $1$ answer$)$

taxation and to render mutual assistance in tax enforcement.$$IRC $7852($d$)$ provides that if a U$.$S$.$ treaty is in conflict with a provision in the IRC,

neither, the U$.$S$.$ treaty, OR the Internal Revenue Code?

$($only $1$ answer$)$

will take general precedence. Rather, the more recent of the two

will have OR will not have? $($only $1$ answer$)$

precedence. In your case, the treaty with Spain

takes OR does not take? $($only $1$ answer$)$

precedence over the IRC Section.$$A taxpayer

must OR is not required to $($only $1$ answer$)$

disclose on the tax return any positions where a treaty overrides a tax law. There is a $$\_\_\_$ penalty $($per failure$)$ for individuals who fail to disclose and a $$\_\_\_$ penalty $($per failure$)$ for corporations that fail to disclose.$$Should you need more information, feel free to contact me$.$Sincerely$,$Jeffrey Hanks, CPA

Tax Partner