Transcript Slide 1

Chapter 1-Part A.
Tax Research
Edited January 1, 2015
Howard Godfrey, Ph.D., CPA
Professor of Accounting
Copyright 2013. Howard Godfrey
C15-Chp-01-1A-Research-Sources-2015
Chapter 1A. Learning Objectives-1
A student should be able to:
1. Understand Reasons for tax law
(control economy, social objective, Etc)
2. Describe steps in the tax research
process (Know sources of tax law).
3. Explain how the facts influence the tax
consequences.
4. Identify sources of tax law & understand
the authoritative value of each.
5. Understand the basic citations, such as
Ltr.Rul. 201031004 or 130 T.C. 88, etc.
Chapter 1A. Learning Objectives-2
6. Consult the tax services to research
an issue.
7. Use Citator to assess authorities.
8. Grasp the basics of computerized
tax research.
9. Understand guidelines that CPAs in
tax practice follow.
10. Prepare work papers &
communications to clients.
1. Reasons for
Tax Law
Why are certain provisions
in the tax law?
Why? Text page 1-1.
What rules are found in sections
167 and 168?
What rules are found in Sec.
168(k) and 179?
Why do we have the special rules
identified in the code sections above?
Why? Text page 1-5.
What rules are found in
section 21?
Why do we have the special
rules identified in the code
section above?
Why? Text page 1-8.
[Amount
Company A
Company B
$000,000] 2014
2015
2014
2015
Revenue
$900 $900
$900
$700
Expenses
800
800
600
800
Net income $100 $100
$300 ($100)
Does sec. 172 help one company?
Without Sec. 172 -- 2-year tax for both TP?
With Sec. 172 -- 2-year tax for both TP?
Does sec. 172 equalize the tax?
2. Research Steps
Describe steps
in the tax research
process.
(Know sources of tax law).
Client-oriented research is
conducted by accounting & law
firms for their clients. It involves
determining tax consequences of a
certain transaction for a given
client. It is performed in
1. Closed-fact or tax
compliance situations.
2. Open-fact or
tax-planning situations.
Steps in Research Process. Pg. 35+
Circular nature tax research. Get more facts.
Restate the research question. Find more tax law.
Six basic steps to the tax research process:
A. Determine the facts.
B. Identify the issues (questions).
C. Locate the applicable authorities.
D. Evaluate the authorities and choose those to
follow where the authorities conflict.
E. Analyze the facts in terms of the applicable
authorities.
F. Communicate conclusions & recommendations
to client.
Keep in mind
A. The objective is not to minimize taxes per se
but rather to maximize the after-tax return.
B. One does not engage in unilateral
transactions; thus, the tax ramifications to all
parties to the contract are relevant.
C. Taxes are only one of the costs of doing
business.
D. The time for tax planning is not restricted to
when one enters into an investment, contract,
and other arrangement, but rather the time
extends throughout the life of the activity.
Uncertainty
Tax research often involves an “uncertain
area;" that is, one that does not have a clearcut, unequivocally correct solution.
The issue should be pursued through the use
of a specifically tailored set of detailed
questions.
Tax research may also involve determining
which issues need to be researched.
It requires a fairly extensive knowledge of tax
law to be able to determine which issues need
to be researched.
Financial Accounting
A tax advisor should always bear in
mind the financial accounting
implications of proposed transactions.
An answer that may be desirable from a
tax perspective may not always be
desirable from a financial accounting
perspective.
Success in any tax practice, especially at
managerial level, requires consideration
of both sets of objectives and
orientations.
Taxation – Relationships
Example: Sec. 2501
Economics
Accounting
Law
Taxation
Political Processes
Example: Sec. 170(l)
Constitution
Societal Concerns
Federal Government
Legislative
Executive
Judicial
Congress
Internal
Revenue
Code
President
Treasury
Regulations
Courts
Court
Cases
Supreme
Committee Revenue Procedures
Court
Notices
Reports
Appeals
Announcements
Courts
Treaties
Letter Rulings, etc. Trial Courts
Revenue Rulings
Sources of Tax Law & Major Questions
1 Internal Revenue Code
For Each Type
2
3
4
5
6
7
8
9
10
11
12
13
Committee Reports
Regulations
Revenue Rulings
Revenue Procedures
Other Admin. Law
Tax Court- Regular
Tax Court- Memo
Tax Court- Summary
Claims Court
District Court
Appeals Court
Supreme Court
1
2
3
4
5
6
7
What is the source?
What is process by which
this type of law is written?
Where do I find the law?
When and Why would
I want to use this law?
What characteristics
affect the way I use it?
Is it brief or detailed, etc.?
How reliable is this
source of law?
How is it cited?
Which of the following
sources is not considered to
be primary authority?
a.
b.
c.
d.
statutory law
administrative law
judicial law
tax journal articles
3. Facts
Explain how the
facts influence the
tax consequences.
Importance of the Facts.
The importance of a
particular set of facts
to the tax results
should be emphasized.
See next slide.
Importance of the Facts.
Richard Crepe owns 100% of the
stock of Crepe Corporation,
which had taxable income of
$10,000 in 2015.
How much federal income tax
does Crepe Corp. owe for 2015?
a. $1,500 b. $2,500
c. $3,400 d. $3,500
Importance of the Facts.
Richard Crepe, M.D. owns 100% of the
stock of Crepe Corporation. Crepe
Corporation’s income and expenditures
are derived from the medical services
provided by Dr. Crepe. At the end of 2015
Crepe Corporation had $10,000 in
reportable taxable income. How much
federal income tax was Crepe Corporation
required to pay for the 2015 year?
a. $1,500 b. $2,500 c. $3,400 d. $3,500
See Sec. 11(b)(1), also 11(b)(2).
4. Sources of tax law
Identify sources of tax
law and understand the
authoritative value
of each.
5. Consult tax service
The Sources of Tax Law
“Tax law" generally encompasses much more
than just tax statutes as enacted by Congress.
The law contains very general language that
requires interpretation, both administrative
and judicial.
Administrative interpretations include
Treasury Regulations, revenue rulings and
revenue procedures.
Judicial interpretations consist of court
decisions. Tax law also consists of
committee reports issued by Congress.
Legislative Process-1 Text 1-17+.
All tax legislation must originate in the House
of Representatives. Tax bills are referred to
the House Ways and Means Committee.
After a bill is approved by the House Ways
and Means Committee, it moves to the floor of
the House for consideration.
If approved by a majority of the House it
moves to the Senate.
After consideration by the Senate Finance
Committee, it moves to the Senate floor for
approval.
Usually the House and Senate bills will not be
in complete agreement.
Legislative Process-2
The bill will then go to a conference
committee consisting of members of both
houses. A compromise will then be made
between the two versions of the tax bill. The
compromise is then voted on by both houses
of Congress and goes on to the President for
his signature or veto.
Both houses of Congress generally hold
extensive hearings at which time interested
parties are allowed to testify.
U.S. Government Printing Office publishes the
statements made at hearings.
Legislative Process-3
Committee reports explaining
Congress's purpose in drafting
legislation are published by the U.S.
Government Printing Office in the
Cumulative Bulletin.
Committee reports are particularly
useful in interpreting the law prior to
issuance of Treasury regulations.
Committee Reports.
As a bill proceeds through
Congress, committee
reports are generated.
What three committee
reports typically are
generated in this process?
Committee Reports- Page 18+
House Ways and Means
Committee,
Senate Finance Committee,
Joint Conference Committee
may generate committee
reports in the process of a bill
becoming law.
Committee Reports
Why are Committee
Reports useful to a tax
researcher?
See committee report
posted on course website
for change in FICA tax.
Committee Reports
Committee Reports contain a general
and technical discussion of a bill’s
provisions.
The reports contain important
information about the legislative intent
of a bill that may be used to resolve
disputes between taxpayers and the
Internal Revenue Service.
These reports may provide the only
guidance you have about a new law until
the Treasury provides regulations.
Internal Revenue Code.
The Internal Revenue Code is the
foundation of all tax law. It was first
codified in 1939. Recodified in 1954, it
has now been named the Internal
Revenue Code of 1986.
Whenever the law is changed, old
language is deleted and new language is
added.
However, a complete history is usually
provided after a code section.
Internal Revenue Code
• A tax bill passed by Congress is usually
enacted as a revenue act that amends
the existing Internal Revenue Code
• Code divided into subtitles, chapters,
subchapters, and sections
• Citations to the Code usually are to
sections (Sec. or §)
Internal Revenue Code
Your client recently received a divorce
from her husband. She has begun paying
him alimony of $10,000 per month.
She is unable to find suitable housing, so
she will continue to live with her former
husband (in the house that he received in
the divorce) for about six months until she
can build a new house.
Is the alimony deductible?
Do some research from your Code & Regs
book. Sec. 71.
Start
1
1
11
21
27
38
46
55
61
61
71
101
141
151
161
211
241
261
Subtitle A - Income Taxes
Stop
59
5
15
26
36
45
53
59
149
68
90
140
150
153
198
223
249
280
A A1A
Individual tax rates
Corporate tax Rates, Changes in rates
Non-Refundable Personal Tax Credits
Other Credits
Business Related Credits
Investment Credit, Work Opportunity Cr., AMT Credit
Alternative minimum tax and environmental tax
F
A
A1B
H
Chapter 1. Normal Taxes and Surtaxes
Subchapter A. Determination of Tax Liability
Subchapter B. Computation of Taxable Income
Gross income defined - Also AGI & other overall rules
Items specifically included in gross income
Items specifically excluded from gross income
Tax exemption requirements for state and local bonds
Personal exemptions
Itemized deductions for individuals & corps. (bus. type)
Additional itemized deductions for individuals (personal)
Special deductions for corporations
Items not Deductible (or partially deductible)
Which of the following is true of the
Internal Revenue Code?
a. It includes statutes and regulations
b. It is issued by the Tax Court
c. It contains law passed by Congress
d. It contains pronouncements of the
Treasury Department
e. It contains pronouncements of the
Internal Revenue Service
Tax Treaties IRC 7852.
The U. S. has treaties with a
number of foreign countries.
The treaties may pertain to tax
and other matters. IRC 7852.
Provisions contained in a
treaty in most cases override
the rules contained in the IRC.
Statutory Sources of Authority
•
•
•
•
U.S. Constitution
Internal Revenue Code
Tax treaties
Committee reports that indicate the
legislative intent of a bill
–House Ways & Means Committee
–Senate Finance Committee
–Joint Conference Committee
Treasury Regs-1. Page 1-19+
Treasury Department issues Treasury
Regulations as interpretations of the
statute. They provide examples complete
with computations to assist in
understanding the statutory language.
Because statutory changes occur
frequently, regulations are not always
updated in a timely manner.
When referring to a regulation, the tax
advisor should consult the introductory
note in order to determine when the
regulation was adopted. IRC 7805
Treasury Regulations-2
Treasury Regulations are first
provided in proposed form and the
public has an opportunity to
comment and suggest changes.
Proposed regulations have no
more authoritative weight than the
position the IRS argues for in a
brief, but provide guidance on the
Treasury Department’s
interpretation of a statute.
Treasury Regulations-3
Temporary regs (which generally are
effective upon publication) are often issued
soon after a major statutory change to
provide guidance on procedural and
computational matters. Temporary
regulations have the same authoritative value
as final regulations; however, they cannot
remain in effect for more than a three-year
period. (They precede final regulations.)
Temporary regulations must be issued
concurrently with proposed regulations.
IRC 7805
Treasury Regulations-4
Final regulations are drafted after
the public has time to comment
on the proposed regulations.
Final regulations have the same
authoritative weight as the
statute and generally take effect
retroactive to the effective date of
statutory language they interpret.
Treasury Regulations-5
For changes to the IRC enacted after July 29,
1996, the Treasury is generally precluded
from issuing regulations with retroactive
effect. In the case of final regulations,
however, a regulation can be effective on the
date proposed or the date on which temporary
regulations are filed with the Federal Register.
Regulations issued within 18 months of the
date of a change to the statute can be issued
with retroactive effect. See committee report
for PL 104-168. Sec. 7805
Treasury Regulations-6
Regulations may be classified as either
interpretative or legislative. Interpretative
regulations are issued under the general
authority of Sec. 7805 and make the statutory
language easier to understand and apply.
They provide illustrations about how to
perform certain computations.
Legislative regulations provide rules on
highly technical matters where Congress has
delegated the rulemaking to the Treasury
Dept. (e.g., consolidated tax return issues).
See Sec. 1501, 1502
Treasury Regulations-7
Section 7805 provides that the Secretary
of the Treasury has the right to prescribe
regulations and to provide what extent
they are to be applied retroactively.
Occasionally, taxpayers can successfully
argue that a regulation is invalid and,
consequently, should not be followed.
This will occur only if the courts find that
the regulation is "unreasonable and
plainly inconsistent with the revenue
statutes.“ See Sec. 7805
Treasury Regulations-8
Some courts apply the legislative
reenactment doctrine, which
holds that regulations finalized
many years earlier and not
amended by Congress through
changes to the statutory
language have Congressional
approval.
Treasury Regulations-9
Numbers before the decimal point
indicate the general subject matter
of the regulation.
Numbers to the right of the decimal
place refer to the IRC section being
interpreted.
Numbers to the right of that number
indicate the number of the
regulation.
Treasury Regulations-10
Temporary or proposed regulations
are cited as Temp. Reg. Sec. or Prop.
Reg. Sec. When providing a citation,
the researcher should be as precise
as possible. An example:
Reg. Sec. 1.165-5(I), Ex. 2(I),
which refers to the first portion of
Example 2 that is contained in the
first portion of the fifth regulation
interpreting Sec. 165.
Regulations
Which of the following statements about
regulations is not true?
a. They are issued by the Treasury
Department.
b. Proposed regulations have more authority
than temporary regulations.
c. Final regulations are issued as Treasury
Decisions.
d. Legislative regulations have more
authority than interpretative regulations.
e. A regulation’s identifying number includes
the code section which it interprets.
Regulation Citations
In the citation
Reg. §1.247-3,
what do the 1 and the
247 indicate?
Regulation Citations
Solution:
The 1 is a prefix that refers
to an income tax regulation;
the 247 is a root number
that designates the Code
section to which the
regulation is related.
Which of the following statements
about regulations is not true?
a. They are issued by the Treasury
Department.
b. Proposed regulations have more
authority than temporary regs.
c. Final regulations are issued as
Treasury Decisions.
d. Legislative regulations have more
authority than interpretative regs.
e. A regulation’s identifying number
includes the code section which it
interprets.
Administrative Rulings-1.
There are a number of different
means that the IRS uses for
interpreting the statute.
After referring to the IRC and
Treasury Regulations, tax advisors
are likely to refer next to IRS
interpretations for further authority
for answering a tax question.
Revenue Rulings-1
Revenue rulings are used to indicate
the tax status of a specific
transaction, which has wide
taxpayer interest.
They represent the viewpoint of the
IRS and do not have as much
authority as federal court cases or
regulations.
Approximately one hundred rulings
are issued each year.
Revenue Rulings-2
A taxpayer does not have to follow a
ruling if there is sufficient authority for
different treatment. An IRS agent is,
however, bound by the rulings.
Rulings are published weekly in the
Internal Revenue Bulletin (I.R.B.) and
semiannually in the Cumulative
Bulletin (C.B.).
How are revenue rulings cited?
Revenue Rulings-3
Does the Code allow a
deduction for Medical
Expenses?
What about the cost of a drug
to grow hair for a bald person?
Tanning Lotion? Viagara?
Tattoo? Where would you look?
Revenue Procedures -1
Revenue procedures usually
deal with procedural aspects
of tax practice.
They are first published in the
Internal Revenue Bulletin and
later in the Cumulative
Bulletin.
Letter Rulings -1
Letter rulings are initiated by taxpayers
who ask the IRS to explain the tax
consequences of a particular transaction.
The IRS responds in a letter ruling that can
be relied on only by the person requesting
it. They provide insight into the current
thinking of the IRS. CCH publishes rulings
with any confidential information deleted
in a separate letter ruling service. Refer
now to book page 22 to illustrate how
letter rulings are cited.
Tax Planning Can be Profitable- (1 of 2)
U.S. Ruling Lets NCNB Earn $2.8 Billion
Before Taxes Begin Tax Shelter On Texas
Deal Could save Bank $1 Billion
(A brief “old” newspaper article)
NCNB Corp. owes its thanks to the IRS.
Its thanks, and perhaps as much as a billion
dollars. That's how much the Charlotte
banking company could save in federal
income tax in the next few years because of
a June 1988 IRS ruling, a five-page letter,
that formed the bedrock of NCNB's winning
bid in July 1988 for the failed First Republic
Bank network in Texas.
Tax Planning Can be Profitable- (2 of 2)
The tax break, from First Republic losses
before NCNB took over, enabled NCNB to
outfox the much larger banks that also bid
for First Republic. First Republic's 40 banks
nearly doubled NCNB's assets to $60 billion,
making it the nation's ninth-largest bank
after it assumed full ownership of the Texas
bank in July. Purchases of savings and
loans in Texas and Florida pushed that
ranking up to 7th.
(Note: This is from an old newspaper article.)
Technical Advice Memoranda (TAM)
When a taxpayer's return is being
audited with respect to a complicated,
technical matter, the taxpayer may
request that the matter be referred to
the IRS National Office in Washington,
D.C. concerning the appropriate tax
treatment.
The answer is issued in the form of a
Technical Advice Memoranda, which is
available in the form of a letter ruling.
Information Releases -1
Information releases contain
information about
interpretations of general
interest and are released to
the news media throughout
the United States.
Announcements and Notices-1
Information releases that are more
technical and aimed at tax
practitioners are issued in the form of
Announcements. Announcements
are often issued before temporary or
proposed regulations can be issued.
The IRS is bound by announcements
and notices in the same way as if
contained in a revenue ruling.
Administrative Sources of Authority
Treasury
Regulations
Internal
Revenue
Service
Revenue Rulings
Revenue Procedures
Letter Rulings
& other pronouncements
Judicial Decisions -1
Judicial decisions
comprise an important
source of tax law.
Judicial decisions in
different jurisdictions are
sometimes in conflict.
Judicial Sources
U. S. Court
of Federal
Claims
U. S.
District
Court
U. S.
Tax Court
U. S. Court
of Appeals
for Federal
Circuit
U. S. Court
of Appeals
Supreme
Court
Overview of Court System-1
There are three trial courts - the
U.S. Tax Court, the U.S. Court of
Federal Claims and the U.S. District
Courts. Litigation may begin in any
court, but precedent is an important
factor in determining where it
should begin.
Court cost may be an important factor.
Overview of Court System-2
Taxes must be paid before litigation begins
in the U.S. Court of Federal Claims or the
U.S. District Courts. After the taxes are
paid, a claim for refund is filed which will
be denied by the IRS. A suit for refund is
then brought and, if won, a refund with
interest is obtained. A suit may be brought
in the Tax Court. If lost, the deficiency
plus any interest and penalties must be
paid.
Overview of Court System-3
The District Courts are the only place
that a jury trial is possible.
Decisions can be appealed from the
Tax Court and the U.S. District Courts
to the Court of Appeals in the
taxpayer's circuit.
Appeals from the U.S. Court of
Federal Claims are taken to the Court
of Appeals for the Federal Circuit.
Overview of Court System-4
A party who loses at the appellate level
can ask the Supreme Court for a writ of
certiorari. The Supreme Court hears only
about six to ten tax cases a year.
(See Figure 1.2 for a Map of the
Geographical Boundaries of the Circuit
Courts of Appeals.)
(See Figure 1.1 for an overview of the
court system.) pg. 23
Don’t memorize info. in these Figures.
U.S. Tax Court. Sec. 7441, 7463.
U.S. Tax Court originated in 1942 as the successor
to Board of Tax Appeals. It is a court of national
jurisdiction that hears only tax-related cases. All
taxpayers, regardless of their state of residence,
may litigate in the Tax Court. It has 19 judges,
including one chief judge.
The President, with the consent of the Senate,
appoints the judges for a 15-year term and may
reappoint them for an additional term.
The judges, specialists in tax-related matters,
periodically travel to roughly one hundred cities
throughout the country to hear cases. In most
instances, only one judge hears a case.
Small Cases. Sec. 7463
Tax Court has special policy for
cases where the amount in
question does not exceed $50,000 a
year (i.e., small cases).
Taxpayers may appear without an
attorney. The cases are heard by
special commissioners instead of
one of the Tax Court judges.
Decisions under this procedure
cannot be appealed.
Acquiescence policy
The IRS has an acquiescence policy with regard to
federal court decisions that have been decided in
the taxpayer's favor. If it wishes to go on record
that it agrees with a federal court decision, it
acquiesces. If it wishes to disagree with a decision,
it issues a nonacquiescence.
An acquiescence or nonacquiescence is binding on
an IRS agent. If a taxpayer is audited and has taken
a position, which the IRS has issued a
nonacquiescence, litigation will likely be the only
recourse for the taxpayer.
IRS acquiescences and nonacquiescences are
published in the Internal Revenue Bulletins and
Cumulative Bulletins.
Regular decisions - Tax Court
Regular decisions of Tax Court are
published by U.S. Government
Printing Office in a bound volume
known as the Tax Court of the
United States Reports.
Soon after a decision is made
public, it is also published by RIA
and CCH in their reporters of Tax
Court decisions.
U.S. District Courts
Each state has a U.S. district court.
Some states have several district
courts. Many different types of cases
are heard by this court.
Taxpayer may request a jury trial.
District court decisions are officially
reported in the Federal Supplement
(F.Supp.) published by West.
Tax decisions are also published by RIA
in American Federal Tax Reports (AFTR)
and by CCH in U.S. Tax Cases (USTC).
U.S. Court of Federal Claims
The U.S. Court of Federal Claims, as
reorganized in 1982 and renamed in 1992,
is a national court with decisions
appealable to the Circuit Court of Appeals
for the Federal Circuit. U.S. Court of
Federal Claims decisions were published in
the Claims Court Reporter by West
Publishing Co from 1982 to 1992.
These cases are now reported in the
Federal Claims Reporter (Fed. Cl.). In
addition, the AFTR and USTC services
report these tax decisions.
Circuit Courts of Appeal-1
Trial court decisions are
appealable to a particular circuit
court of appeals depending upon
where the litigation originated.
In the case of an individual, it
depends upon the taxpayer's
residence on the date of appeal.
In the case of a corporation, it is
the principal place of business that
controls.
Circuit Courts of Appeal-2
There are 11 geographical circuits, the
circuit for the District of Columbia and
the Federal Circuit. (See Figure 1.2)
New circuit court of appeals decisions
are reported officially in the Federal
Reporter, Third Series (F.3d) published
by West.
In addition, AFTR and USTC services
report these decisions.
Supreme Court-1
A decision of an appellate court can
be appealed to the U.S. Supreme
Court. Unless the circuits are
divided on the proper treatment of
an issue or the issue is deemed of
great significance, the Supreme
Court likely will not grant certiorari.
Decisions of the Supreme Court are
the law of the land.
Supreme Court-2
If Congress does not agree
with a Supreme Court
decision, statutory language
in the Internal Revenue Code
can be amended to reach the
desired result.
Supreme Court-3
Supreme Court decisions are published
in the United States Supreme Court
Reports (U.S.) by U.S. Government
Printing Office,
Supreme Court Reporter (S.Ct.) by West,
and
United States Reports, Lawyers' Edition
(L.Ed.) by Lawyer's Co-Operative
Publishing Co. AFTR and USTC services
also report these tax decisions.
6. Use Citator
7. Understand
Computerized
Tax Research
TC Memo. 2008-293, December 23, 2008.
Taxpayer was denied a medical expense deduction for in
vitro fertilization (IVF) expenses incurred in fathering two
children. He had no physical or mental condition that
prevented him from procreating without the use of IVF
technologies; therefore, the expenses were not incurred
for the treatment of a medical condition or for the purpose
of affecting any structure or function of the body.
Your client incurred a similar expenditure. How would you
use citator to see if this case was overturned on appeal?
Would you be willing to sign the return of your
client that contains a deduction for these
expenses? Explain.
How would you use the CCH tax service for your
research in this matter?
Precedential Value of Decisions-1
1. Tax Court will generally rule uniformly for
taxpayers. It is bound by Supreme Court
decisions. In 1970, Golsen rule was adopted
which provides that Tax Court will follow
decisions of the court for the circuit to
which a case in question is appealable.
2. U.S. district court decisions have
precedential value only for subsequent
cases heard in the same district. District
courts must follow decisions of the
Supreme Court and the court of appeals to
which the case is appealable.
Precedential Value of Decisions-2
3. The U.S. Court of Federal Claims
must rule consistently with the
Supreme Court, Circuit Court of
Appeals for the Federal Circuit and
its own earlier decisions.
4. A circuit court of appeals is
bound by the Supreme Court and
earlier decisions made by that
circuit.
Precedential Value of Decisions-3
Because the courts are not
always in agreement, a
taxpayer can sometimes
forum shop to select a court
that is likely to be most
favorable to the taxpayer's
position.
Court Procedure
Mr. G does not agree with the findings
of Tax Court. His case was not handled
under "small tax case procedure."
Which one of the following courts
would he appeal to first?
a. U. S. Court of Appeals
b. U.S. Court of Appeals for
the Federal Circuit
c. U. S. Supreme Court
d. Claims Court.
The next slide
should be
printed as a full
page
Initial Publisher, Book and Citation
Gov. U. S. Supreme Court Reports
____U.S. ____
West: Supreme Court Reporter
____ S.Ct. ____
Supreme
Court
Appeals
Court
Initial Publisher, Book and Citation
West Federal Reporter
____F.2d ____
Tax Court
Publisher, Book and Citation
Regular:
Gov. U.S. Tax Court Reports
District Court
Gen.
T.C. Memo. ___-___
T.C. Memorandum
T.C. Memo __________
CCH T.C. Memorandum
____ TCM ____
CCH: United States Tax Cases
____USTC ____
Publisher, Book and Citation
RIA: Am. Federal Tax Reports
____AFTR2d ______
CCH: United States Tax Cases
____USTC _____
Claims Court
West: Federal Supplement
Publisher, Book and Citation
West: Claims Court Reporter
____ F. Supp. ____
____Fed.Cl. _____
Publisher, Book and Citation
Federal Reporter
____ T.C. ____
Memo:
Publisher, Book and Citation
RIA: Am. Federal Tax Reports
____AFTR2d ____
RIA Am. Federal Tax Reports
____AFTR2d ____
_____F.3d _____
____F.2d _____
RIA
CCH
United States Tax Cases
____USTC ____
See RIA and CCH cites to the left.
Citations for Tax Court Small Cases are omitted. Tax Court was initially called the Board of Tax Appeals (BTA).
The name of the Claims court is actually The U.S. Court of Federal Claims.
Tax Court
Regular
Publisher:
Gov. Printing
Office
Book:
Cite:
Tax Court of the
Rosemary Kovacs
United States Reports
100 T.C. 124
Memo
Publisher:
Book:
Gov
(None)
CCH
Tax Court
Walter H. Johnson
Memo. Decisions
34 TCM 1056
T.C. Memo. Decisions
Walter H. Johnson
RIA
Cite:
T.C. Memo 1975-245
¶75,245 P-H T.C. Memo
Citations
You want to read an appeals
court case in the tax area.
Which of the following
citations may refer to an
appeals court case?
a. 59 TCM 327 b. 91-1 USTC 303
c. 94 TC 203
d. 1991-1 C.B. 202
Authority of Tax Law
Assume you located the following four
authorities in a tax service that each
support a position you wish to take on
your own tax return.
Which of the four authorities would
carry the least weight in a dispute you
might later have with the IRS?
a. a part of the Code
b. a Treasury Regulation
c. a Circuit Court Decision
d. a private letter ruling
8. Guidelines in practice
Understand guidelines
that CPAs in tax
practice should follow.
9. Prepare Workpapers
and communications
to Clients
Statements on Standards For Tax Services
Statements on Standards for Tax Services provide
a standard of ethical practice for CPAs engaged in
tax practice. The standards are professionally
enforceable; that is, they may be enforced through
a disciplinary proceeding conducted by the
AICPA, which may terminate or suspend a
practitioner from AICPA membership. See
alsoTreasury Department Circular 230.
How do the Statements on Standards For Tax
Services impact tax research?
The NC State Board of CPA Examiners has
adopted these rules. See State Board regs on web.
The
End