Chapter 28

Working With the Tax LawSTART - Research Process - Below

Tax Sources

Primary Sources - Code Legis Hist Regs IRS pronouncements Court decisions

Statutory Sources

Statute Codifications - 39, 54, 86 Rev Acts part of CodeNumbering

39 54 & 86

Seidman’s

Legis Hist H Rep (Ways & Means) S Rep (SFC) Conf Comm Rep

Code Arrangement Overall (OH) Within a Section (OH)

Administrative Sources

Not precedent (i.e., precedent only loosely)

but substantial authority (Conc Sum 28-1) (OH)

Regs:

Numbering, citation final / prop / temp legis/inter/proc Final + Temp = force of law prop = law brief; Judicial review

Other IRS Issuances

Rev RulsLtr Ruls - post 84 sub auth; sanitized TD’s Anns, Notices det ltrs TAMs, GCMs AODS

Judicial Sources

court config (Fig 28-3)(OH): cts of orig jurisd, cts of app jurisd

stare decisis: binding v. advisory precedent, or controlling v. persuasive; holding v. dicta

Trial Courts:

cts - T.C., D.CT., U.S.Ct. Fed Cl.# judges location juries b4 payment v. refund (C S 28-2)(OH)

Appellate Cts:

11 + D.C. + Fed Cir; (CA - 9th Cir) (Fig 28-5) (OH)

US Ct of Fed Cl (new name 10/92) - appeal to Fed Cir Ct App

T.C. appeal to one of 11 or DC - Golsen rule; no appeal small cases division (50000)

“appeal” to USSC = writ of cert (certiorari) (discretionary)

role of app ct (review of applic law) maj, diss, concur opins - app cts and

panel at TC, US Ct Fed Cl affirm, reverse, remand-app cts

Judicial Cites - Courts & Reporters

Case name, followed by reporters, Ct. (OH)

(1) TC (pre 43 BTA) reg cases, mem cases, small tax casesacq and NA by IRS, memorandum or

regular casesCCH, PH (now RIA) pub; only official T.C.

(2) USDC, Ct of Fed Cl, CT App

USTC, AFTRalso F Supp, F3d,

Cl Cts (82)/Fed.Cl (92)

(3) USSC - US, SCt, LEd, USTC, AFTR

Research

The process (as applied to assigned problem)

issue (state it)sources (decide which)look at (sources)write (samples)

Research = method to determine available solution to situation with tax conseqs; i.e., to find applicable law to solve problem

Planning = consideration of alternatives, if any

Steps - ID & refine problem (state issue)

locate appropriate sources (decide what to look at & look at)

weigh validity (conflicts - IRS v. code v. courts possible)(put it together)

Solution, includg nontax (memo: issue, law, reasoning, conclusion) (write)

communicate to t/p (t/p decision) F/U (where to approp - no duty

unless take on)

Locating Appropriate Sources

Usually tax service 1st

CCH SFTR, RIA USTR (Prev PH Taxes)

Also: BNA Tax Man Portfolios; RIA Tax Coord; Mertens, R&J, Bender (now in CCH)

Careful

UpdateAnnotations - see fullPeriodicals: - Index: Goldstein, CCH, Lexis “More Useful” (OH) Careful - Reading the Code Assessing Validity - diff sources, with RA Communicating - Memo Form

Planning

Minimization of Tax AND other business goals (social?) (deferral)

Avoidance v. EvasionJudge Learned Hand

Cant = hypocritically pious language

The now classic words of Judge Learned Hand in Commissioner v. Newman reflect the true values a taxpayer should have:

Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced extractions, not voluntary contributions. To demand more in the name of morals is mere cant.

Computers in Tax Practice

Tax Software for returns, planning - professional (e.g., Lacerte, CCH) home use (Tax Cut, Turbo Tax)

Microcomputer spreadsheets

Research: Lexis + Westlaw, CCH Research Network, RIA Checkpoint (on line)

Word arrangement v. legal theory/fact pattern (logic)

up to the minuteCD ROMInternet