Volunteer Income Tax Assistance (VITA) Certification Practice Test

What action should a tax preparer take if a taxpayer provides incomplete information during the interview?

1. Inform the taxpayer that they cannot file.

2. Ask additional questions to clarify.

3. Prepare the return based on the information provided.

4. Advise the taxpayer to return another day.

The correct answer is: Ask additional questions to clarify.

When a taxpayer provides incomplete information during the interview, the most appropriate action for the tax preparer is to ask additional questions to clarify. This approach ensures that the preparer can gather all the necessary information to accurately prepare the tax return. By seeking clarification, the tax preparer demonstrates a commitment to understanding the taxpayer's situation fully, which can lead to identifying all applicable credits and deductions. It is essential for an accurate filing while also maintaining compliance with tax laws. Gathering complete information helps avoid misunderstandings that could lead to mistakes on the tax return, which could negatively affect the taxpayer, such as potential audits or penalties. Engaging the taxpayer in a dialogue not only fosters trust but also empowers them to participate actively in the process, ensuring they understand the information needed and the implications of their responses. In contrast, simply informing the taxpayer that they cannot file or advising them to return another day may lead to unnecessary delays in the filing process, and preparing a return based on incomplete information could result in significant errors. Therefore, asking additional questions is the responsible and effective action to take.