Assignment5[1].LC - Spring 2009 ASSIGNMENT 5 ADMINISTRATIVE...

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Spring 2009 ASSIGNMENT 5 ADMINISTRATIVE PRONOUNCEMENTS Objective: At the end of this assignment, you will be able to: Define several types of administrative interpretations, including regulations, revenue rulings, revenue procedures, letter rulings, technical advice memoranda, and similar pronouncements. Understand the significance of the various types of administrative pronouncements. Assignment: 1. Re-read the Chapter 2 materials under Administrative Interpretations (pages 2-12 through 2-17) of the Pratt, Kulsrud text ( Individual Taxation or Federal Taxation ). There is no other posted reading assignment for this topic. 2. Review the PowerPoint slides for Assignment 5 (Administrative Pronouncements). There are two files. 3. Research and answer the Assignment 5 quiz questions , and post your answers on Oncourse by the due date. Overview The Treasury Department’s job is to administer the laws that Congress writes and the President approves. The Secretary of the Treasury has general responsibility for administering the tax law, but in reality that duty is assigned to different divisions within the Treasury Department. The Internal Revenue Service, a division of the Treasury Department, manages day-to-day operations associated with administering provisions of the Internal Revenue Code. The chief operating official of the IRS is the Commissioner of Internal Revenue, who is a presidential appointee. Remember, it is not the IRS Code , it is the Internal Revenue Code enacted by Congress and signed into law by the President. The IRS is simply the agency that implements the law—it does not write it! To facilitate the IRS’s administration of the tax laws, the Code authorizes the Treasury Secretary (or his or her delegate) to prescribe the rules and regulations necessary to administer the Code. Section 7805(a) says: SEC. 7805. RULES AND REGULATIONS. (a) AUTHORIZATION.-- Except where such authority is expressly given by this title to any person other than an officer or employee of the Treasury Department, the Secretary shall prescribe all needful rules and regulations for the enforcement of this title, including all rules and regulations as may be necessary by reason of any alteration of law in relation to internal revenue.
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In practice, most pronouncements are written by IRS staff or staff of the Office of the Chief Counsel of the IRS, who is an assistant general counsel of the Treasury Department. Four major types of pronouncements that are issued under this authority: Regulations Revenue rulings Revenue procedures, and Letter rulings These are extremely important because they indicate how the IRS views a particular issue. Recall that disregard of the rules and regulations can result in a negligence penalty being imposed on the taxpayer.
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Assignment5[1].LC - Spring 2009 ASSIGNMENT 5 ADMINISTRATIVE...

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