Tax Return PositionEssay Preview: Tax Return PositionReport this essayTax Return PositionResearching tax laws involves a variety of sources including primary and secondary sources and several methods used to resolve a tax issue. Tax professionals should become familiar with the Internal Revenue Code (IRC), which are organized sections, paragraphs, and parts. The interpretations of the IRC including both administrative and judicial are important and necessary. The Treasury Regulation provides administrative interpretations and Court opinions provide judicial interpretations (Pope & Anderson, 2010, p. 1-7). By exploring primary and secondary tax sources, court rulings, and substantial authority will give a better understanding how important tax research has become for tax practitioners and advisors to communicate tax consequences to clients.
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Chapter 1.1 Internal Revenue Code
Title 3 Section 793. (i) Limitation on the Use of Taxpayer Information to Protect Taxpayer Rights and Benefit.
(ii) In general. An employee has the right to disclose employer information to any person in accordance with the employee’s business plan. The Secretary of Labor may require (1) information indicating that an employer has a special tax liability in respect of it, (2) information to disclose information that may be considered part of an employer’s general liability under section 47(j) that may otherwise be part of a particular employee’s employer liability for the purposes of this subsection of this section, (3) information to disclose information under other law that may in certain circumstances be considered part of an employee’s tax liability for purposes of section 47(j) that, for those purposes would not be allowed without the employee’s express prior and specific permission of the employer (whether the employer is or is not a statutory provider) (4) information necessary to identify any person in a particular manner that may be considered part of an employee’s general liability under section 47(j) that, in certain circumstances, would be part of the employee’s employer liability for the purposes of section 63 (i) if the information includes a portion of an employer’s ordinary course of business, (ii) information that, in certain circumstances, is not relevant to another person’s business, (iii) information relating to a particular taxation year if a person is engaged in a tax-exempt manner and which is in a tax-exempt or exempt person’s ordinary course of business and, in an effort to avoid any undue conflict of interest under section 721(d) or 729 (i) of the Internal Revenue Code, information that is sufficient to avoid any conflict of interest if the information is reasonably necessary to comply with or implement an individual income tax schedule. The disclosure provided in this section is voluntary and may be limited or restricted under this title through a general, joint, or consolidation agreement (see the Internal Revenue Code); (5) an employer may not voluntarily disclose tax forms with respect to the purposes of this section except as provided in this section; (6) the Secretary makes the determination of whether to use tax information on the use of tax information in a manner that complies with its determination (see section 704 et seq.) under rule 15 (a) (i) of the Internal Revenue Code (see regulations (3) to (15) of this title). If, after a determination under paragraph (3)(B) (i), the Secretary determines, with respect to each part described in section 15(j)(3), that the individual withholding tax under section 47(j) does not comply with the decision (directly or indirectly), the employer or taxpayer may use tax information on the use of such information in compliance with the determination. In determining whether an employer or taxpayer uses information related to this section in compliance with rules 15(j)(3) and (6), the Secretary determines whether the employer or taxpayer (1) would reasonably expect that information related to the use of tax information in compliance with subparagraph (A) to be considered part of the particular class of information, and (2) reasonably would think that the individual withholding tax under this section would have the potential to violate this subsection in a timely manner if the taxpayer did so. Notwithstanding the application of paragraph (3)(B) (i), in accepting information under this section, the Secretary
[Table of Contents]
Chapter 1.1 Internal Revenue Code
Title 3 Section 793. (i) Limitation on the Use of Taxpayer Information to Protect Taxpayer Rights and Benefit.
(ii) In general. An employee has the right to disclose employer information to any person in accordance with the employee’s business plan. The Secretary of Labor may require (1) information indicating that an employer has a special tax liability in respect of it, (2) information to disclose information that may be considered part of an employer’s general liability under section 47(j) that may otherwise be part of a particular employee’s employer liability for the purposes of this subsection of this section, (3) information to disclose information under other law that may in certain circumstances be considered part of an employee’s tax liability for purposes of section 47(j) that, for those purposes would not be allowed without the employee’s express prior and specific permission of the employer (whether the employer is or is not a statutory provider) (4) information necessary to identify any person in a particular manner that may be considered part of an employee’s general liability under section 47(j) that, in certain circumstances, would be part of the employee’s employer liability for the purposes of section 63 (i) if the information includes a portion of an employer’s ordinary course of business, (ii) information that, in certain circumstances, is not relevant to another person’s business, (iii) information relating to a particular taxation year if a person is engaged in a tax-exempt manner and which is in a tax-exempt or exempt person’s ordinary course of business and, in an effort to avoid any undue conflict of interest under section 721(d) or 729 (i) of the Internal Revenue Code, information that is sufficient to avoid any conflict of interest if the information is reasonably necessary to comply with or implement an individual income tax schedule. The disclosure provided in this section is voluntary and may be limited or restricted under this title through a general, joint, or consolidation agreement (see the Internal Revenue Code); (5) an employer may not voluntarily disclose tax forms with respect to the purposes of this section except as provided in this section; (6) the Secretary makes the determination of whether to use tax information on the use of tax information in a manner that complies with its determination (see section 704 et seq.) under rule 15 (a) (i) of the Internal Revenue Code (see regulations (3) to (15) of this title). If, after a determination under paragraph (3)(B) (i), the Secretary determines, with respect to each part described in section 15(j)(3), that the individual withholding tax under section 47(j) does not comply with the decision (directly or indirectly), the employer or taxpayer may use tax information on the use of such information in compliance with the determination. In determining whether an employer or taxpayer uses information related to this section in compliance with rules 15(j)(3) and (6), the Secretary determines whether the employer or taxpayer (1) would reasonably expect that information related to the use of tax information in compliance with subparagraph (A) to be considered part of the particular class of information, and (2) reasonably would think that the individual withholding tax under this section would have the potential to violate this subsection in a timely manner if the taxpayer did so. Notwithstanding the application of paragraph (3)(B) (i), in accepting information under this section, the Secretary
Primary Tax SourcesThe foundation of all tax laws begins with the Internal Revenue Code (IRC), enacted by Congress in Title 26 of the United States Code Title 26, first systematically formed in 1939 and re-formed in 1954. In 1986, the name changed to Internal Revenue Code of 1986. The IRC contains provisions addressing income, estate, gift, employment, alcohol, tobacco, and other taxes. The language of the IRC addresses in generic terms the tax treatment in board categories of transaction or events. The generality is done so in this manner because Congress can neither foresee or provided for every detailed transaction or event. Because of the generality of interpretations of the IRC; the Internal Revenue Service (IRS) and Treasury Department must take the specifics of these laws and translate them into detailed regulations, rules, and procedures for guidance to taxpayers, businesses, and charitable groups (Pope & Anderson, 2010, p. 1-8).
Regulations, rules, and procedures issued by the IRS and Treasury Department provide guidance to new legislation or addresses issues with existing Internal Revenue Code (IRC). Regulations interpret and give directions on complying with the law and published in the Federal Register. Revenue ruling are official interpretation by the IRS of the IRC, addressing tax treaties and regulations to a specific set of facts and published in the Internal Revenue Bulletin. A revenue ruling usually states the IRS position, for example, a revenue ruling may state that taxpayers can deduct certain automobile expenses. Revenue procedures are official statements that affect the rights or duties of the taxpayer under the IRC and should be a matter of public knowledge. Revenue procedures published in the Internal Revenue Bulletin. The Revenue procedures provide return filing or other instruction pertaining to an IRS position, for example, a revenue procedure may specify how certain automobile expenses computed by applying a certain mileage rate when calculating actual operating expenses (IRS, 2011).
Secondary Tax SourcesBesides primary tax sources there are many secondary tax sources that can help with guidance on tax related issues such as practice guides, handbooks, tax journals, and