13.1 - Tax Legislation Flashcards
Tax Legislation
What is the tax legislation process?
- House
- Senate
- Possible Joint Committee
- President
Tax Legislation
What does the House in tax legislation consist of?
- House Ways & Means Committee
- Full House of Representatives
Tax Legislation
What does the “Senate” consist of in tax legislation?
- Senate Finance Committee
- Full Senate
Tax Legislation
At what point does the “Possible Joint Committee” get involved in tax legislation?
- If Senate revises the House version
Tax Legislation
What vote does Congree need to veto President?
2/3rd vote
Authoritative Tax Law
Identify the 3 types of authoritative tax law
- Legislative law
- Administrative law
- Judicial law
Legislative Law:
What does legislative law consist of?
- internal revenue code
- committee reports
Legislative Law:
Where does legislative law come from?
Congress
Legislative Law:
How is legislative law authorized?
by the Constitution
Legislative Law:
What is the most referenced form of legislative law for tax legislation?
Internal Revenue Code
Legislative Law:
What is the purpose of committee reports in legislative law?
- Outlines the purpose of the law
- Ensure proper application of tax law
Who puts adminstrative law into practice?
Treasury Department
Administrative Law:
What does administrative law consist of?
- Regulations
- Revenue Rulings
- Revenue Procedure
Administrative Law:
What are regulations?
- Interpretations of specific code sections authorized by law
Administrative Law:
Identify the party bound by regulations in administrative law
- IRS bound by regulations courts are not
Administrative Law:
Define revenue rulings in administrative law
- Official interpretation of revenue law as applied to a given set of facts and is issued by the IRS
Administrative Law:
Are revenue ruling binding on courts?
No
Administrative Law:
What is the distinction between revenue rulings and regulations?
- Regulations — general interpretation of a code section
- Revenue Ruling — IRS interpretation of how a code section should be applied to a specific set of facts
Administrative Law:
Where are revenue rulings published and for what purpose?
- in Internal Revenue Bulletins to inform and advise taxpayers, IRS and others on substantive tax issues
Administrative Law:
True or False >>>
a revenue ruling is cited as inferior and not relied upon in disputes
False -
- Cited as precedence and relied upon when resolving disputes, but no force & effect of regulations
Administrative Law:
What is a revenue procedure?
- official IRS statement that prescribe the procedures that affect the rights or duties of tax payers
Administrative Law:
What type of matters do revenue procedures primarily address?
- Administrative and procedure matters
Administrative Law:
Do revenue procedures have the force and effect of law?
No, but they may be cited as precedent
Administrative Law
Identify other IRS releases under administrative law
- Internal Revenue Bulletin
- IRS Publications
- Private Letter Rulings & Technical Advice Memoranda
Administrative Law
Define IRB or an Internal Revenue Bulletin
authoritative instrument of the Commissioner of Internal Revenue for
- announcing official IRS rulings and procedures
- publishing Treasury Decisions, Executive Orders, Tax Conventions, legislation, court decisions, etc.
Administrative Law
What are IRS publications?
- Not cited to sustain a position
- Explain law in plain language
Administrative Law
What is a private letter ruling?
- represents the conclusion of the Service for an individual taxpayer
- confined to the specific case issued for unless issue covered by statute
Judicial Law:
Where does judicial law originate from?
federal court system
Judicial Law:
Define the 3 courts where tax cases begin at
- Tax court
- District court
- Court of federal claims
Judicial Law:
Identify the 5 courts under judicial law
- Tax court
- District court
- Court of federal claims
- Circuit courts of appeal
- Appellate court
- Supreme court
- Final
Tax Court
How are decisions issued in tax court?
- Decisions issued as either regular decision or memorandum decisions
Tax Court
When may a taxpayer dispute a tax deficiency in tax court?
before payment
Supreme Court
What is the purpose of the Supreme Court?
- Resolves inconsistent decisions between lower courts
Supreme Court
What steps or processes does the Supreme Court take when reviewing decisions of lower courts?
- Issues a writ of certiorari to lower court to start review process
Supreme Court
What opinion is expressed if the Supreme Court refuses to issue a writ of certiorari to lower courts?
- Denial of writ of certiorari by Supreme Court expresses no opinion on the merit of the case
Supreme Court
Can the Supreme Court exercise discretion over which decisions to review?
Yes
Authority Hierarchy
How does authority higher in the hierarchy impact lower conflicting authority?
- Authority higher in the hierarchy overrules lower conflicting authority
Authority Hierarchy
If two separate authorities or tax legislations are within the same tier, which rule would take precedence?
most recent rule stands
Define tax research
- Process of gathering situational facts, applying appropriate tax authorities and communicating the findings
Identify the 3 primary authorities for tax research
- Internal Revenue Code
- Tax Court Cases
- Treasury Regulations
Identify the secondary authority for tax research
- IRS publications
Administrative Law
Define the types of regulations that fall under administrative law
- proposed
- temporary
- final
Administrative Law
Define a proposed regulation under administrative law
- Issued to elicit comments from the public
Administrative Law
When is a public hearing made regarding a proposed regulation under administrative law?
- Public hearing held if written request made
Administrative Law
Is a proposed regulation considered an authoritative resource when taking a tax position?
- Weak authority
- Used as somewhat of an authority for taking a tax position
Administrative Law
Define a temporary regulation under administrative law
- Provide guidance to the IRS, tax practitioners and the public until final regulations are issued
Administrative Law
When is a public hearing made for a temporary regulation under administrative law?
- No public hearing unless written requests are made
Administrative Law
What level of authority do temporary regulations have?
- somewhat of an authority
- Same force and effect of law as final regulations until final regulation is issued
Administrative Law
How long are temporary regulations effective for under administrative law?
- Effective max 3 years
Administrative Law
Are temporary regulations and proposed regulations the same?
- Must be issued concurrently as proposed regulations
Administrative Law
Define a final regulation under administrative law
- Adopted after public comment on proposed versions are evaluated by Treasury
What is a treasury decision?
- Doc describing finalization or amendment is referred to as a Treasury Decision (TD).
