Federal Tax II Chapter 1

Tax Research is conducted to determine the tax consequences of specific transactions to specific taxpayers.

• Determine the facts
• Identify issues
• Locate applicable authorities
• Evaluate authorities
• Analyze facts in light of authorities
• Communicate results and recommendations

• IRC
• Treasury Regulations
• Judicial interpretations
• Other administrative sources

Authority granted by Congress to interpret the Code.

• Represent the Treasury Department's official interpretation of the Code.
• Not as authoritative.

• Usually issued immediately after passage of a major tax act to provide guidance to taxpayers.
• Less authoritative than final regulations but they are still binding on taxpayers.

They are issued as Treasury decisions.

They are issued under general authority of Sec. 7805.

Congress delegates its rule-making authority to the Treasury Department.

A taxpayer writes and asks the IRS to explain the tax consequences of a particular transaction.

Request by an IRS agent for technical assistance.

• Regulations or announcement of the IRS' position on a court decision.
• Published in the IRB.