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research project slides (complete)

research project slides (complete) - Chapter 1 Corporations...

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Chapter 1 Corporations Tax Research Learning Objectives After studying this chapter, the student should be able to: 1. Describe the steps in the tax research process. 2. Identify the sources of tax law and understand the authoritative value of each. 3. Consult tax services to research an issue. Objective 1: Steps in the Tax Research Process Overview of Tax Research. Tax research can be conducted in a number of different settings. Tax research involves solving a specific tax-related question using a number of tax law sources as they apply to the particular situation. Sample work papers demonstrating how to document the results of a research effort are included in Appendix A. In addition, this chapter discusses the AICPA's guidelines for CPAs in tax practice, the Statements on Standards for Tax Services, that are included in Appendix E. A. Client-oriented research is conducted by accounting and law firms for the benefit of their clients. It involves determining the tax consequences of a certain transaction for a given client. It is performed in 1. Closed-fact or tax compliance situations. (See Example I15-1.) 2. Open-fact or tax-planning situations. (See Example I15-2.) B. Academic settings. Tax policy research may be conducted by individuals in an academic setting (e.g., accounting programs, law schools, economics departments, etc.). What steps do I take to research an issue? Emphasis should be placed on the fact that tax research is a circular process sometimes requiring the determination of different facts, restatement of the research question, or reliance on additional authorities. (Refer here to Figure I15-1.) There are, however, 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 the ones to follow when the authorities conflict. E. Analyze the facts in terms of the applicable authorities. F. Communicate conclusions and recommendations to the client. Objective 2: Identify Sources of the Law The Sources of Tax Law. The term "tax law" generally encompasses much more than just the tax statutes as enacted by Congress. The law contains 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
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Congress during the legislative process. A. Legislative Process. 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. The bill will then go to a Conference Committee consisting of members of both houses. A compromise will
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