551 - COMMON ERRORS IN TAX RESEARCH Mistakes You Don't Want...

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COMMON ERRORS IN TAX RESEARCH Mistakes You Don’t Want to Make In reading a couple of million tax research papers, one finds there is no perfect approach to either the research or the write-up. Below are some common mistakes in both the research technique and the write-up. First of all, remember that there is no perfect approach. Attorneys may take one approach while accountants might take another. In any event, the following list provides some idea of the mistakes that you should try and avoid. It is by no means complete nor are the items mentioned in any order of importance. 1. Identify the facts and state them up front . This statement of what the client has told you regarding his or her situation provides the basis of your research. It tells what your conclusions are based on. And, three years down the road when the client's return is audited and he says, "Well, I told you that," you can point out exactly what facts he did and did not convey. In your paper, the first section should simply be "FACTS." A recent paper began In today’s complex world, the tax laws and regulations are highly technical and ever changing. Individuals skilled in the knowledge of tax concepts are rewarded generously. One of the main objectives why taxpayers seek professional consultations is for help on reducing their tax liability. There are many ways for a taxpayer to reduce their tax liability. While this opening statement might be suitable for a term paper on tax research for an English course, it is not an appropriate start for a tax research memorandum that will be read by your supervisor who has been practicing for several years. Remember your audience. 2. Determine the issue and state it up front . This may require reading some background material that provides you the necessary framework to understand the problem. A basic text book is often a good starting point. In addition, the tax services provide some background and their own editorial interpretations. 3. In beginning your research, start with the Internal Revenue Code rather than cases. State what the statute says about the issue. All answers to research questions should be framed initially in terms of a Code section because the Code is the ultimate authority. It is the bible! 4. Consider the Regulations after the Code . The authors of the Regulations tried to anticipate problems that might arise in interpreting the basic statute. For an example, consider the 150 hour requirement that must be met to sit for the CPA exam. The law may say you must have an accounting concentration in order to take the CPA exam but not give you any idea of what an accounting concentration is. The Regulations may in fact say that it consists of 24 hours of accounting. Therefore, the Regulations often, but not always, provide sufficient guidance regarding how the statute should be applied in a particular situation.
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5. Citing the Regulations. When citing the regulations, make sure to observe whether the regulations are in final, temporary or proposed form. It is assumed they are in
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This note was uploaded on 06/23/2009 for the course BUPA 551 taught by Professor Susan during the Spring '09 term at IUPUI.

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551 - COMMON ERRORS IN TAX RESEARCH Mistakes You Don't Want...

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