1-1 ©2010 Pearson Education, Inc. Publishing as Prentice Hall.

1-1©2010 Pearson Education, Inc. Publishing as Prentice Hall

1-2

TAX RESEARCHTAX RESEARCH(1 of 2)(1 of 2)

Overview of tax researchSteps in the tax research processImportance of facts to the tax

consequencesSources of tax lawTax services

©2010 Pearson Education, Inc. Publishing as Prentice Hall

1-3

TAX RESEARCHTAX RESEARCH(2 of 2)(2 of 2)

CitatorsInternet as a research toolProfessional guidelines for tax

services


1-4

Overview of Tax Overview of Tax ResearchResearch

(1 of 2)(1 of 2)

Close-fact or tax complianceFacts already occurredDiscovery of tax consequencesProper disclosure


1-5

Overview of Tax Overview of Tax ResearchResearch

(2 of 2)(2 of 2)

Open-fact or tax-planningBefore structuring or concluding a

transactionMinimization of taxesCareful compliance permits legal

avoidance of taxation


1-6

Steps in the Tax Steps in the Tax Research ProcessResearch Process (1 of 2)(1 of 2)

Determine the factsIdentify the issues (questions)Locate applicable authoritiesEvaluate authorities

Choose which to follow when authorities conflict


1-7

Steps in the Tax Steps in the Tax Research ProcessResearch Process (2 of 2)(2 of 2)

Analyze facts in terms of applicable authorities

Communicate conclusions and recommendations to clientTreas. Dept. Circular 230 covers

all written advice communicated to clients


1-8

Importance of the Importance of the Facts to the Tax Facts to the Tax ConsequencesConsequences

Ambiguous situations (gray areas)Facts are clear but the law is notLaw is clear but the facts are not

Advance planning permits facts to develop that produce favorable tax consequences


1-9

Sources of Tax LawSources of Tax Law(1 of 2)(1 of 2)

Legislative processInternal Revenue CodeTreasury RegulationsAdministrative pronouncements Judicial decisionsTax treatiesTax periodicals


1-10

Legislative ProcessHouse Ways and Means CommitteeVoted on by full HouseSenate Finance CommitteeVoted on by full SenateConference Committee

Voted by both full House and SenateSigned or vetoed by President

Override veto by 2/3 vote by both houses


1-11

Internal Revenue Code (IRC)

Title 26 of the United States Code enacted by Congress

OrganizationTitle

SubtitleChapter

Subchapter - Part

- Subpart - Section


1-12

Treasury Regulations(1 of 3)

Treasury Dept. delegates authority to IRS to promulgate Treas. Regs.

Types of Treasury Regulations Proposed: no authoritative weightTemporary

Provide immediate guidanceSame authority as Final Regs.

Final


1-13


Interpretative RegulationsInterpret related Code sectionLess authority than IRC

Legislative RegulationsAlmost the same authority as IRC

Legislative reenactment doctrineCheck date of Regs.

Law may have changed after written


1-14


1.165-51 – Income tax165 – IRC citation5 – 5th regulation

Subject matter1 – Income tax20 – Estate tax25 – Gift tax301 – Admin/procedural matters601 – Procedural rules


1-15

Administrative Pronouncements

(1 of 5)

Revenue RulingsMore specific than Regs.Less authority than Regs.

Revenue ProceduresIRS guidance on procedural

matters


1-16


(2 of 5)

Citation of Revenue Rulings and ProceduresRev. Rul. (or Proc.) 97-4, 1997-1

C.B. 54th Rev. Ruling of 1997

Beginning with 2000, all four digits of the year are used (e.g., Rev. Rul. 2007-5)

In Cumulative Bulletin 1997-1 on p. 5


1-17


(3 of 5)

Letter RulingsReply to specific taxpayer questionOnly authority for specific taxpayerLtr. Rul. 200130006 (August 6,

2001)2001 – year30 – week006 – 6th letter ruling of the 30th week


1-18


(4 of 5)

Other interpretationsTechnical Advice Memoranda

IRS advice to an IRS agent on technical matters

Issued to public in form of letter rulingsInformation releases

Like press releasesWritten in lay terms Sent to newspapers


1-19


(5 of 5)

Other interpretations (continued)Announcements and notices

More technical than information releases

Address current tax developmentsIRS bound by to follow

Just like Revenue Rulings and Procedures


1-20

Judicial Decisions

Overview of court systemU.S. Tax CourtU.S. District CourtsU.S. Court of Federal ClaimsU.S. Supreme courtPrecedential value of various

decisions


1-21

Overview of Court System(1 of 2)

U.S. TaxCourt

U.S . District Courtfor taxpayer's

district

Court of Appeals fortaxpayer's geographicaljurisdiction (1st - 11th &

D.C. Circuits)

U.S . Court ofFederal Claims

U.S. Court of Appealsfor Federal Circult

Suprem e Court


AppellateCourts

1-22

Overview of Court System(2 of 2)


Circuit States Included in Circuit1st ME, MA, NH, RI, PR2nd CT, NY, VT3rd DE, NJ, PA, VI4th MD, NC, SC, VA, WV5th LA, MS, TX6th KY, MI, OH, TN7th IL, IN, WI8th AR, IA, MN, MO, NE, ND, SD9th AK, AZ, CA, HI, ID, MT, NV, OR, WA, GU, MP10th CO, KS, NM, OK, UT, WY11th AL, FL, GAD.C. District of ColumbiaFederal All Districts

1-23

U.S. Tax Court(1 of 3)

Taxpayer does not pay deficiency before litigating case

No jury trial availableRegular and Memorandum

decisionsSmall Cases ProcedureAcquiescence policy


1-24


Regular decisionsFirst time court hears case

Memo decisionsFactual variations of previous cases

Small cases procedureCases of <$50,000 eligibleLess formal than regular tax court


1-25


Acquiescence policyIRS announces whether or not it

agrees with Tax Court decisions


1-26

U.S. District Courts

May request a jury trialMust pay deficiency firstUnreported decisions

Decisions not officially reportedPublished by RIA and CCH


1-27

U.S. Court of Federal Claims

No jury trialMust pay deficiency firstDecisions appealable to Circuit

Court of Appeals for the Federal Circuit


1-28

Circuit Courts of Appeals

Losing party at trial level may appeal decision to appellate court

Circuit Courts of Appeals Appeals from Tax Court & district courtsBased upon geography

Court of Appeals for the Federal CircuitAppeals from U.S. Court of Federal Claims


1-29

Supreme Court

Very few tax cases are heardHears cases when

Circuit courts are divided orIssue of great importance

Same authority as IRC


1-30

Precedential Value of Decisions

Same Court

Tpayer’s Circuit

Supreme Court

Golsen Rule

DC X X X

TC X X X X

CFC X X X

CA X X

SC X


1-31

Tax ServicesTax Services (1 of 2)(1 of 2)

Annotated servicesOrganized by IRC sectionUnited States Tax Reporter by RIAStandard Federal Tax Reporter by

CCH


1-32

Tax ServicesTax Services (2 of 2)(2 of 2)

Topical services organized by topicFederal Tax Coordinator 2d by RIATax Management Portfolios by BNACCH Federal Tax Service by CCH


1-33

CitatorsCitatorsHistory of the caseList of other authorities that

have cited the case in questionRefer to Table 4 in book for list of

terms describing status change in IRS rulings

CCH CitatorRIA Citator 2nd Series


1-34

Internet as a Research Internet as a Research ToolTool


Information CHECKPOINT CCH NETWORKRecent developments Newsstand MyCCHPrimary & secondary sources Federal Federal

State and local reporters State & Local StateAll int’l references International International

Estate tax Estate Planning Financial & Estate Planning

Pension taxation Pension & Benefits Pension & PayrollPayroll taxation Payroll Pension & Payroll

1-35

Professional Professional Guidelines for Tax Guidelines for Tax

ServicesServices (1 of 2) (1 of 2)

Treas. Dept. Circular 230Pertains to all tax practitionersRules to practice before IRSGuidance on written advice to

taxpayersGives gov’t authority to impose

fines for violations of rules


1-36

Professional Professional Guidelines for Tax Guidelines for Tax

ServicesServices (2 of 2) (2 of 2)

AICPA SSTSsEthical framework for

taxpayer/client relationshipHigh standards of careNo duty to verify client

information if not suspicious


Comments or questions about PowerPoint Slides?Contact Dr. Richard Newmark at University of Northern Colorado’s

Kenneth W. Monfort College of [email protected]

1-37©2010 Pearson Education, Inc. Publishing as Prentice Hall

Date post:	11-Jan-2016
Category:	Documents
Upload:	ezra-allison
View:	216 times
Download:	2 times

1-1 ©2010 Pearson Education, Inc. Publishing as Prentice Hall.

Documents