Prentice Hall's Federal Taxation 2001, Individuals

by Pope, Thomas R.; Anderson, Kenneth; Kramer, John

• ISBN13: 9780130260178
• ISBN10: 0130260177
• Format: Hardcover
• Copyright: 2000-04-01
• Publisher: PRENTICE HALL

Summary

Written by nationally recognized tax educators, this acclaimed three-volume series provides a hands-on, definitive guide to federal income taxation concepts and applications. For the "2001 edition there is a web-site offering great resources and huge $$avings for on-line student supplements available with the books, and the accounting hotline offers immediate service for faculty. (PHFT: Corp - See ANDERSON)

Table of Contents

Preface	xiii
An Introduction To Taxation	1	(1)
History of Taxation in the United States	2	(1)
Early Periods	2	(1)
Revenue Acts From 1913 to the Present	3	(1)
Revenue Sources	3	(1)
Types of Tax Rate Structures	3	(4)
The Structure of Individual Income Tax Rates	3	(2)
The Structure of Corporate Tax Rates	5	(1)
Marginal, Average, and Effective Tax Rates for Taxpayers	5	(1)
Determination of Taxable Income and Tax Due	6	(1)
Types of Taxes	7	(4)
State Income and Franchise Taxes	7	(1)
Wealth Transfer Taxes	7	(3)
Other Types of Taxes	10	(1)
Criteria for a Tax Structure	11	(2)
Equity	11	(1)
Certainty	12	(1)
Convenience	12	(1)
Economy	13	(1)
Objectives of the Federal Income Tax Law	13	(1)
Economic Objectives	13	(1)
Encouragement of Certain Activities and Industries	13	(1)
Social Objectives	14	(1)
Tax Law Sources	14	(1)
Enactment of a Tax Law	15	(2)
Steps in the Legislative Process	15	(2)
Administration of the Tax Law and Tax Practice Issues	17	(3)
Organization of the Internal Revenue Service	17	(1)
Enforcement Procedures	18	(1)
Selection of Returns for Audit	18	(1)
Statute of Limitations	19	(1)
Interest	19	(1)
Penalties	19	(1)
Administrative Appeal Procedures	20	(1)
Components of a Tax Practice	20	(2)
Tax Compliance and Procedure	20	(1)
Tax Research	20	(1)
Tax Planning and Consulting	21	(1)
Financial Planning	21	(1)
Computer Applications in Tax Practice	22	(1)
Tax Return Preparation	22	(1)
Tax Planning Applications	22	(1)
Tax Research Applications	22	(1)
Problem Materials	23
Discussion Questions	23	(2)
Problems	25	(1)
Case Study Problem	26	(1)
Research Problem	26
Determination of Tax	1	(1)
Formula for Individual Income Tax	2	(5)
Basic Formula	2	(1)
Definitions	3	(3)
Tax Formula Illustrated	6	(1)
Deductions from Adjusted Gross Income	7	(11)
Itemized Deductions	7	(3)
Standard Deduction	10	(2)
Personal Exemptions	12	(1)
Dependency Exemptions	12	(5)
Child Credit	17	(1)
Determining the Amount of Tax	18	(6)
Filing Status	18	(1)
Joint Return	19	(1)
Surviving Spouse	20	(1)
Head of Household	20	(1)
Single Taxpayer	21	(1)
Married Filing a Separate Return	21	(1)
Abandoned Spouse	21	(1)
Dependents with Unearned Income	22	(2)
Corporate Tax Formula and Rates	24	(1)
Treatment of Capital Gains and Losses	25	(1)
Definition of Capital Assets	25	(1)
Tax Treatment of Gains and Losses	26	(1)
Tax Planning Considerations	26	(3)
Splitting Income	27	(1)
Maximizing Itemized Deductions	27	(1)
Filing Joint or Separate Returns	27	(2)
Compliance and Procedural Considerations	29	(1)
Who Must File	29	(1)
Due Dates for Filing Return	29	(1)
Use of Forms 1040, 1040EZ, and 1040A	30	(1)
System for Reporting Income	30	(1)
Problem Materials	30
Discussion Questions	30	(1)
Issue Identification Questions	31	(1)
Problems	32	(4)
Tax Form/Return Preparation Problems	36	(1)
Case Study Problems	36	(1)
Tax Research Problems	37
Gross Income: Inclusions	1	(1)
Economic and Accounting Concepts of Income	2	(1)
Economic Concept	2	(1)
Accounting Concept	2	(1)
Concept of Income	3	(3)
Administrative Convenience	3	(1)
Wherewithal to Pay	4	(1)
Gross Income Defined	4	(2)
To Whom Is Income Taxable?	6	(2)
Assignment of Income	6	(1)
Allocating Income Between Married People	6	(2)
Income of Minor Children	8	(1)
When Is Income Taxable?	8	(4)
Cash Method	8	(3)
Accrual Method	11	(1)
Hybrid Method	11	(1)
Items of Gross Income: Sec. 61(a)	12	(10)
Compensation	12	(1)
Business Income	12	(1)
Gains from Dealings in Property	12	(1)
Interest	13	(1)
Rents and Royalties	14	(1)
Dividends	15	(2)
Alimony and Separate Maintenance Payments	17	(2)
Pensions and Annuities	19	(2)
Income from Life Insurance and Endowment Contracts	21	(1)
Income from Discharge Of Indebtedness	21	(1)
Income Passed Through to Taxpayer	21	(1)
Other Items of Gross Income	22	(4)
Prizes, Awards, Gambling Winnings, and Treasure Finds	22	(1)
Illegal Income	22	(1)
Unemployment Compensation	23	(1)
Social Security Benefits	23	(1)
Insurance Proceeds and Court Awards	24	(1)
Recovery of Previously Deducted Amounts	25	(1)
Claim of Right	26	(1)
Tax Planning Considerations	26	(3)
Shifting Income	26	(1)
Alimony	27	(1)
Prepaid Income	27	(1)
Taxable, Tax-Exempt, or Tax-Deferred Bonds	27	(1)
Reporting Savings Bond Interest	28	(1)
Deferred Compensation Arrangements	28	(1)
Compliance and Procedural Considerations	29	(1)
Problem Materials	30
Discussion Questions	30	(3)
Issue Identification Questions	33	(1)
Problems	34	(3)
Comprehensive Problems	37	(1)
Tax Form/Return Preparation Problems	37	(1)
Case Study Problems	38	(1)
Tax Research Problem	38
Gross Income: Exclusions	1	(1)
Items That Are Not Income	2	(2)
Unrealized Income	2	(1)
Self-Help Income	3	(1)
Rental Value of Personal-Use Property	3	(1)
Selling Price of Property	3	(1)
Major Statutory Exclusions	4	(17)
Gifts and Inheritances	4	(1)
Life Insurance Proceeds	5	(1)
Adoption Expenses	6	(1)
Awards for Meritorious Achievement	7	(1)
Scholarships and Fellowships	7	(1)
Distributions from Qualified State Tuition Programs	7	(1)
Payments for Injury and Sickness	8	(1)
Employee Fringe Benefits	9	(8)
Foreign-Earned Income Exclusion	17	(1)
Income from The Discharge of A Debt	18	(2)
Exclusion for Gain from Small Business Stock	20	(1)
Other Exclusions	21	(1)
Tax Planning Considerations	21	(1)
Employee Fringe Benefits	21	(1)
Self-Help and Use of Personally Owned Property	22	(1)
Compliance and Procedural Considerations	22	(1)
Problem Materials	23
Discussion Questions	23	(1)
Issue Identification Questions	24	(1)
Problems	24	(4)
Comprehensive Problem	28	(1)
Tax Form/Return Preparation Problems	29	(1)
Case Study Problems	29	(1)
Tax Research Problems	30
Property Transactions: Capital Gains and Losses	1	(1)
Determination of Gain Or Loss	2	(3)
Realized Gain or Loss	2	(2)
Recognized Gain or Loss	4	(1)
Basis Considerations	5	(7)
Cost of Acquired Property	5	(1)
Property Received as a Gift: Gifts After 1921	6	(1)
Property Received from a Decedent	7	(2)
Property Converted From Personal Use to Business Use	9	(1)
Allocation of Basis	10	(2)
Definition of a Capital Asset	12	(3)
Influence of the Courts	13	(1)
Other IRC Provisions Relevant to Capital Gains and Losses	13	(2)
Tax Treatment For Capital Gains and Losses of Noncorporate Taxpayers	15	(5)
Capital Gains	15	(1)
Adjusted Net Capital Gains (ANCG)	16	(1)
Capital Losses	17	(3)
Sale or Exchange	20	(7)
Worthless Securities	21	(1)
Retirement of Debt Instruments	21	(3)
Options	24	(1)
Patents	24	(1)
Franchises, Trademarks, and Trade Names	25	(1)
Lease Cancellation Payments	26	(1)
Holding Period	27	(2)
Property Received as a Gift	27	(1)
Property Received from a Decedent	28	(1)
Nontaxable Exchanges	28	(1)
Receipt of Nontaxable Stock Dividends and Stock Rights	28	(1)
Preferential Treatment for Net Capital Gains	29	(1)
Mobility of Capital	29	(1)
Mitigation of the Effects of Inflation and the Progressive Tax System	29	(1)
Lower the Cost of Capital	29	(1)
Tax Planning Considerations	30	(1)
Selection of Property to Transfer By Gift	30	(1)
Selection of Property to Transfer at Time of Death	31	(1)
Compliance and Procedural Considerations	31	(1)
Documentation of Basis	31	(1)
Reporting of Capital Gains and Losses On Schedule D	32	(1)
Problem Materials	32
Discussion Questions	32	(4)
Issue Identification Questions	36	(1)
Problems	36	(4)
Tax Form/Return Preparation Problems	40	(1)
Case Study Problems	41	(1)
Tax Research Problems	42
Deductions and Losses	1	(1)
Business or Investment Requirement	5	(2)
Ordinary Expense	7	(1)
Necessary Expense	8	(1)
Reasonable Expense	8	(1)
Expenses and Losses Must Be Incurred By the Taxpayer	9	(1)
General Restrictions on the Deductibility of Expenses	9	(8)
Capitalization Versus Expense Deduction	10	(1)
Expenses Related to Exempt Income	11	(1)
Expenditures That Are Contrary To Public Policy	12	(2)
Other Expenditures That Are Specifically Disallowed	14	(3)
Proper Substantiation Requirement	17	(1)
When an Expense Is Deductible	17	(6)
Cash Method	18	(2)
Accrual Method	20	(3)
Special Disallowance Rules	23	(11)
Wash Sales	23	(2)
Transactions Between Related Parties	25	(3)
Hobby Losses	28	(2)
Vacation Home	30	(3)
Expenses of an Office in the Home	33	(1)
Tax Planning Considerations	34	(2)
Hobby Losses	34	(1)
Unreasonable Compensation	35	(1)
Timing of Deductions	35	(1)
Compliance and Procedural Considerations	36	(1)
Proper Classification of Deductions	36	(1)
Proper Substantiation	36	(1)
Business Versus Hobby	36	(1)
Problem Materials	37
Discussion Questions	37	(1)
Issue Identification Questions	38	(1)
Problems	39	(5)
Comprehensive Problem	44	(1)
Tax Form/Return Preparation Problems	44	(2)
Case Study Problems	46	(1)
Tax Research Problem	47
Itemized Deductions	1	(1)
Medical Expenses	2	(6)
Qualified Individuals	2	(1)
Qualified Medical Expenses	3	(3)
Amount and Timing of Deduction	6	(2)
Taxes	8	(3)
Definition of a Tax	8	(1)
Deductible Taxes	9	(1)
Nondeductible Taxes	9	(1)
State and Local Income Taxes	9	(1)
Personal Property Taxes	10	(1)
Real Estate Taxes	10	(1)
General Sales Tax	11	(1)
Self-Employment Tax	11	(1)
Interest	11	(9)
Definition of Interest	12	(1)
Classification of Interest Expense	12	(7)
Timing of the Interest Deduction	19	(1)
Charitable Contributions	20	(8)
Qualifying Organization	21	(1)
Type of Property Contributed	22	(2)
Deduction Limitations	24	(1)
Application of Carryovers	25	(1)
Special Rules for Charitable Contributions Made By Corporations	26	(1)
Summary of Deduction Limitations	26	(2)
Casualty and Theft Losses	28	(1)
Miscellaneous Itemized Deductions	28	(1)
Certain Employee Expenses	28	(1)
Expenses to Produce Income	28	(1)
Cost of Tax Advice	28	(1)
Reduction of Certain Itemized Deductions	29	(1)
Tax Planning Considerations	30	(3)
Medical Expense Deduction	30	(1)
Interest Expense Deduction	31	(1)
Deduction for Charitable Contributions	32	(1)
Compliance and Procedural Considerations	33	(3)
Medical Expenses	33	(1)
Contribution of Property	33	(1)
Charitable Contributions	33	(3)
Taxes	36	(1)
Problem Materials	36
Discussion Questions	36	(2)
Issue Identification Questions	38	(1)
Problems	38	(4)
Tax Form/Return Preparation Problems	42	(1)
Case Study Problems	43	(1)
Tax Research Problem	44
Losses And Bad Debts	1	(1)
Transactions That May Result in Losses	2	(2)
Sale or Exchange of Property	2	(1)
Expropriated, Seized, or Confiscated Property	3	(1)
Abandoned Property	3	(1)
Worthless Securities	3	(1)
Demolition of Property	4	(1)
Classifying the Loss on The Taxpayer's Tax Return	4	(3)
Ordinary Versus Capital Loss	4	(2)
Disallowance Possibilities	6	(1)
Passive Losses	7	(9)
Computation of Passive Losses and Credits	7	(1)
Carryovers	7	(2)
Definition of a Passive Activity	9	(2)
Taxpayers Subject to Passive Loss Rules	11	(2)
Publicly Traded Partnerships	13	(1)
Other Rental Real Estate Activities	14	(2)
Casualty and Theft Losses	16	(6)
Casualty Defined	16	(2)
Theft Defined	18	(1)
Deductible Amount of Casualty Loss	18	(1)
Limitations on Personal-Use Property	19	(1)
Netting Casualty Gains and Losses on Personal-use Property	20	(1)
Casualty Gains and Losses Attributable to Business and Investment Property	20	(1)
When Losses Are Deductible	21	(1)
Bad Debts	22	(6)
Bona Fide Debtor-creditor Relationship	23	(1)
Taxpayer's Basis in the Debt	24	(1)
Debt must be Worthless	25	(1)
Nonbusiness Bad Debts	25	(1)
Business Bad Debts	26	(1)
Accounting for the Business Bad Debt	26	(1)
Recovery of Bad Debts	27	(1)
Deposits in Insolvent Financial Institutions	27	(1)
Net Operating Losses	28	(4)
Computing the Net Operating Loss	28	(3)
Carryback and Carryover Periods	31	(1)
Recomputation of Taxable Income in the Carryover Year	32	(1)
Tax Planning Considerations	32	(1)
Bad Debts	32	(1)
Casualties	33	(1)
Net Operating Losses	33	(1)
Compliance and Procedural Considerations	33	(1)
Casualty Losses	33	(1)
Net Operating Losses	34	(1)
Worthless Securities	34	(1)
Problem Materials	34
Discussion Questions	34	(2)
Issue Identification Questions	36	(1)
Problems	36	(4)
Tax Form/Return Preparation Problems	40	(1)
Case Study Problems	41	(1)
Tax Research Problem	42
Employee Expenses And Deferred Compensation	1	(1)
Classification of Employee Expenses	2	(2)
Limitations on Unreimbursed Employee Expenses	3	(1)
Travel Expenses	4	(4)
Deductibility of Travel Expenses	4	(1)
Definition of Travel Expenses	5	(1)
General Qualification Requirements	5	(1)
Business Versus Pleasure	6	(1)
Foreign Travel	7	(1)
Additional Limitations on Travel Expenses	8	(1)
Transportation Expenses	8	(4)
Definition and Classification	9	(1)
Treatment of Automobile Expenses	10	(1)
Reimbursement of Automobile Expenses	11	(1)
Entertainment Expenses	12	(3)
50% Disallowance for Meal and Entertainment Expenses	12	(1)
Classification of Expenses	12	(1)
Business Meals	13	(1)
Entertainment Facilities and Club Dues	14	(1)
Business Gifts	15	(1)
Limitations on Entertainment Tickets	15	(1)
Reimbursed Employee Business Expenses	15	(3)
Moving Expenses	18	(2)
Expense Classification	18	(1)
Definition of Moving Expenses	18	(1)
Treatment of Employer Reimbursements	19	(1)
Education Expenses	20	(2)
Classification of Education Expenses	20	(1)
General Requrements for a Deduction	21	(1)
Office in Home Expenses	22	(3)
General Requirements for a Deduction	22	(2)
Deduction and Limitation	24	(1)
Deferred Compensation	25	(15)
Qualified Pension and Profit-Sharing Plans	26	(1)
Qualification Requirements for a Qualified Plan	27	(1)
Tax Treatment to Employees and Employers	28	(1)
Nonqualified Plans	29	(3)
Employee Stock Options	32	(1)
Plans for Self-Employed Individuals	33	(2)
Individual Retirement Accounts (IRAs)	35	(1)
Traditional IRA	35	(2)
Roth IRA	37	(2)
Education IRA	39	(1)
Simplified Employee Pensions	39	(1)
Tax Planning Considerations	40	(2)
Moving Expenses	40	(1)
Providing Nontaxable Compensation To Employees	41	(1)
Compliance and Procedural Considerations	42	(4)
Substantiating Travel and Entertainment Expenses	42	(1)
Reporting Employee Business Expenses	42	(3)
Reporting Moving Expenses	45	(1)
Reporting Office in Home Expenses	45	(1)
Qualification of Pension and Profit-Sharing Plans	45	(1)
Problem Materials	46
Discussion Questions	46	(3)
Issue Identification Questions	49	(1)
Problems	49	(7)
Tax Form/Return Preparation Problems	56	(1)
Case Study Problems	57	(1)
Tax Research Problem	58
Depreciation, Cost Recovery, Amortization, and Depletion	1	(1)
General Considerations	2	(2)
Pre-ACRS Depreciation (Years Before 1981)	4	(1)
ACRS (1981 Through 1986)	4	(2)
MACRS (1987 and Later Years)	6	(4)
Section 179 Expensing Election	10	(1)
Macrs Restrictions	11	(3)
Amortization	14	(6)
Sec. 197 Intangibles	15	(3)
Depletion Methods	18	(2)
Treatment of Intangible Drilling and Development Costs	20	(1)
Tax Planning Considerations	20	(2)
Alternative Depreciation System Under MACRS	20	(1)
IDCs: Capitalization Versus Expensing Election	20	(2)
Structuring a Business Combination	22	(1)
Compliance and Procedural Considerations	22	(1)
IDC Election Procedures	22	(1)
Reporting Cost Recovery, Depreciation, Depletion, and Amortization Deductions	22	(1)
Problem Materials	23
Discussion Questions	23	(5)
Issue Identification Questions	28	(1)
Problems	29	(3)
Tax Form/Return Preparation Problems	32	(2)
Case Study Problems	34	(1)
Tax Research Problem	34
Accounting Periods and Methods	1	(1)
Accounting Periods	2	(5)
Required Payments and Fiscal Years	3	(1)
Changes in the Accounting Period	4	(1)
Returns for Periods of Less Than 12 Months	5	(2)
Overall Accounting Methods	7	(3)
Cash Receipts and Disbursements Method	7	(1)
Accrual Method	8	(1)
Hybrid Method	9	(1)
Inventories	10	(4)
Determination of Inventory Cost	11	(3)
Special Accounting Methods	14	(7)
Long-Term Contracts	14	(3)
Installment Sales Method	17	(3)
Deferred Payment Sales	20	(1)
Imputed Interest	21	(3)
Imputed Interest Computation	22	(1)
Accrual of Interest	23	(1)
Gift, Shareholder, and Other Loans	23	(1)
Change in Accounting Methods	24	(3)
Amount of Change	25	(1)
Reporting the Amount of the Change	26	(1)
Obtaining IRS Consent	26	(1)
Tax Planning Considerations	27	(1)
Accounting Periods	27	(1)
Accounting Methods	27	(1)
Installment Sales	27	(1)
Compliance and Procedural Considerations	27	(2)
Reporting Installment Sales on Form 6252	27	(2)
Procedures for Changing to LIFO	29	(1)
Problem Materials	29
Discussion Questions	29	(1)
Issue Identification Questions	30	(1)
Problems	30	(3)
Tax Form/Return Preparation Problem	33	(1)
Case Study Problems	33	(1)
Tax Research Problems	34
Property Transactions: Nontaxable Exchanges	1	(1)
Like-Kind Exchanges	2	(8)
Like-Kind Property Defined	2	(3)
A Direct Exchange Must Occur	5	(1)
Three-Party Exchages	5	(1)
Receipt of Boot	6	(1)
Basis of Property Received	7	(1)
Exchanges Between Related Parties	8	(1)
Transfer of Non-Like-Kind Property	9	(1)
Holding Period for Property Received	9	(1)
Involuntary Conversions	10	(6)
Involuntary Conversion Defined	11	(1)
Tax Treatment of Gain Due to Involuntary Conversion Into Boot	12	(1)
Tax Treatment of Gain Due to An Involuntary Conversion Directly Into Similar Property	13	(1)
Replacement Property	13	(2)
Obtaining Replacement Property	15	(1)
Time Requirements for Replacement	15	(1)
Sale of Principal Residence	16	(5)
Sale of More Than One Principal Residence Within a Two-Year Period	18	(2)
Involuntary Conversion of a Principal Residence	20	(1)
Tax Planning Considerations	21	(2)
Avoiding the Like-Kind Exchange Provisions	21	(1)
Sale of a Principal Residence	21	(2)
Compliance and Procedural Considerations	23	(1)
Reporting of Involuntary Conversions	23	(1)
Reporting of Sale or Exchange of a Principal Residence	23	(1)
Problem Materials	24
Discussion Questions	24	(1)
Issue Identification Questions	25	(1)
Problems	25	(5)
Tax Form/Return Preparation Problems	30	(2)
Case Study Problems	32	(1)
Tax Research Problems	32
Property Transactions: Section 1231 and Recapture	1	(1)
History of Sec. 1231	2	(1)
Overview of Basic Tax Treatment for Sec. 1231	2	(2)
Net Gains	2	(1)
Net Losses	3	(1)
Tax Rate for Net Sec. 1231 Gain	4	(1)
Section 1231 Property	4	(2)
Section 1231 Property Defined	4	(1)
Real or Depreciable Property Used in Trade or Business	5	(1)
Involuntary Conversions	6	(1)
Condemnations	6	(1)
Other Involuntary Conversions	6	(1)
Procedure For Sec. 1231 Treatment	7	(1)
Recapture Provisions of Sec. 1245	8	(2)
Purpose of Sec. 1245	9	(1)
Recapture Provisions of Sec. 1250	10	(5)
Purpose of Sec. 1250	11	(1)
Unrecaptured Section 1250 Gain	11	(1)
Recapture Rules For Residential Rental Property	12	(1)
Residential Rental Property That Is Recovery Property	12	(1)
Recapture Rules For Nonresidential Real Estate	13	(1)
Low-Income Housing	14	(1)
Additional Recapture for Corporations	15	(2)
Summary of Sec. 1231, 1245 and 1250 Gains	16	(1)
Recapture Provisions---Other Applications	17	(5)
Gifts of Property Subject to Recapture	17	(1)
Transfer of Property Subject to Recapture At Death	17	(1)
Charitable Contributions	17	(1)
Like-kind Exchanges	18	(1)
Involuntary Conversions	18	(1)
Installment Sales	18	(1)
Section 179 Expensing Election	19	(1)
Conservation and Land Clearing Expenditures	20	(1)
Intangible Drilling Costs and Depletion	20	(1)
Gain on Sale of Depreciable Property Between Related Parties	21	(1)
Tax Planning Considerations	22	(1)
Avoiding the Recapture Provisions	22	(1)
Compliance and Procedural Considerations	23	(5)
Reporting Sec. 1231 Gains and Losses on Form 4797	24	(1)
Reporting Gains Recaptured as Ordinary Income on Form 4797	24	(1)
Reporting Casualty or Theft Gain or Loss on Form 4684	24	(4)
Problem Materials	28
Discussion Questions	28	(1)
Issue Identification Questions	29	(1)
Problems	29	(5)
Tax Form/Return Preparation Problems	34	(1)
Case Study Problem	35	(1)
Tax Research Problem	36
Special Tax Computation Methods, Tax Credits, and Payment of Tax	1	(1)
Alternative Minimum Tax	2	(5)
Computational Aspects	2	(1)
Tax Preference Items	3	(1)
AMT Adjustments	3	(3)
Summary Illustration of the AMT Computations	6	(1)
Self-Employment Tax	7	(1)
Computing the Tax	7	(1)
What Constitutes Self-Employment Income	8	(1)
Overview of Tax Credits	8	(1)
Use and Importance of Tax Credits	8	(1)
Value of a Credit Versus a Deduction	9	(1)
Classification of Credits	9	(1)
Personal Tax Credits	9	(6)
Child Tax Credit	10	(1)
Child and Dependent Care Credit	10	(2)
Tax Credit for the Elderly and Disabled	12	(1)
Adoption Credit	12	(1)
Hope Scholarship Credit	13	(1)
Lifetime Learning Credit	14	(1)
Miscellaneous Credits	15	(1)
Foreign Tax Credit	15	(1)
General Business Credits	16	(4)
Credit for Increasing Research Activities	17	(1)
Disabled Access Credit	17	(1)
Tax Credit for Rehabilitation Expenditures	18	(1)
Business Energy Credits	18	(1)
Work Opportunity Credit	18	(1)
Welfare-to-Work Credit	19	(1)
Empowerment Zone Employment Credit	19	(1)
Limitation Based Upon Tax Liability	20	(1)
Refundable Credits	20	(3)
Earned Income Credit	20	(3)
Payment of Taxes	23	(5)
Withholding of Taxes	23	(3)
Estimated Tax Payments	26	(2)
Tax Planning Considerations	28	(2)
Avoiding the Alternative Minimum Tax	28	(1)
Avoiding the Underpayment Penalty for Estimated Tax	28	(1)
Cash-Flow Considerations	28	(1)
Use of General Business Tax Credits	29	(1)
Foreign Tax Credits and the Foreign Earned Income Exclusion	29	(1)
Child and Dependent Care Credit	29	(1)
Compliance and Procedural Considerations	30	(1)
Alternative Minimum Tax Filing Procedures	30	(1)
Withholding and Estimated Tax	30	(1)
General Business Tax Credits	31	(1)
Personal Tax Credits	31	(1)
Problem Materials	31
Discussion Questions	31	(2)
Issue Identification Questions	33	(1)
Problems	34	(4)
Comprehensive Problem	38	(1)
Tax Form/Return Preparation Problems	39	(1)
Case Study Problems	39	(1)
Tax Research Problem	40
Tax Research	1	(1)
Overview of Tax Research	2	(1)
Steps in the Tax Research Process	3	(2)
Importance of the Facts to the Tax Consequences	5	(1)
Ability to Design a Factual Situation Favoring the Taxpayer	6	(1)
The Sources of Tax Law	6	(19)
The Legislative Process	7	(1)
The Internal Revenue Code	8	(1)
Treasury Regulations	9	(2)
Administrative Interpretations	11	(2)
Judicial Decisions	13	(11)
Tax Treaties	24	(1)
Tax Periodicals	24	(1)
Tax Services	25	(2)
United States Tax Reporter	25	(1)
Standard Federal Tax Reporter	25	(1)
Federal Tax Coordinator 2d	26	(1)
Law of Federal Income Taxation (Mertens)	26	(1)
Tax Management Portfolios	27	(1)
CCH Federal Tax Service	27	(1)
Citators	27	(4)
CCH citator	28	(2)
Research Institute of America Citator 2nd Series	30	(1)
Computers As a Research Tool	31	(3)
Statements on Responsibilities in Tax Practice	34	(2)
Sample Work Papers and Client Letter	36	(1)
Problem Materials	37
Discussion Questions	37	(1)
Problems	38	(3)
Comprehensive Problem	41	(1)
Case Study Problem	41	(1)
Tax Research Problem	41
Corporations	1	(1)
Definition of a Corporation	2	(1)
Similarities and Differences Between Corporations and Individuals	3	(1)
Similarities	3	(1)
Differences	3	(1)
Specific Rules Applicable to Corporations	3	(4)
Capital Gains and Losses	3	(1)
Dividends-Received Deduction	4	(1)
Net Operating Losses	5	(1)
Charitable Contributions	6	(1)
Compensation Deduction Limitation For Publicly Held Corporations	7	(1)
Computation of Tax	7	(11)
Computation of Taxable Income	7	(1)
Computation of Regular Tax	7	(3)
Computation of the Corporate Alternative Minimum Tax (AMT)	10	(2)
Penalty Taxes	12	(3)
Computation of Tax for Controlled Groups	15	(3)
Consolidated Returns	18	(1)
Transfers of Property to Controlled Corporations	18	(4)
Section 351 Nonrecognition Requirements	19	(1)
Basis Considerations	20	(1)
Treatment of Liabilities	21	(1)
Capitalization of the corporation	22	(1)
Earnings and Profits	23	(3)
Calculation of Earnings and Profits	23	(2)
Current Versus Accumulated E&P	25	(1)
Nonmoney Distributions	26	(1)
Tax Consequences to the Shareholders	26	(1)
Tax Consequences to the Distributing Corporation	26	(1)
Stock Redemptions	27	(3)
Determining Whether a Redemption is a Dividend or Capital Gain	28	(1)
Redemption Provisions for Special Situations	29	(1)
Corporate Distributions in Complete Liquidation	30	(2)
Tax Consequences to the Liquidating Corporation	30	(1)
Tax Consequences to the Shareholders	31	(1)
Section 332: Liquidation of a Subsidiary Corporation	31	(1)
Tax Planning Considerations	32	(2)
Capital Structure and Section 1244	32	(1)
Dividend Policy	33	(1)
Use of Losses	33	(1)
Charitable Contributions	33	(1)
Dividends-Received Deduction	33	(1)
Compliance and Procedural Considerations	34	(2)
Filing Requirements	34	(1)
Schedule M-1 and M-2 Reconciliations	34	(1)
Maintenance of Records for E&P	35	(1)
Problem Materials	36
Discussion Questions	36	(1)
Issue Identification Questions	37	(1)
Problems	38	(6)
Tax Form/Return Preparation Problems	44	(1)
Case Study Problems	45	(1)
Tax Research Problem	46
Partnerships and S Corporations	1	(1)
Types of Flow-Through Entities	2	(2)
Partnerships	2	(1)
S Corporations	3	(1)
Limited Liability Companies	3	(1)
Limited Liability Partnerships	3	(1)
Taxation of Partnerships	4	(13)
Formation of A Partnership	4	(3)
Partnership Operations	7	(1)
Special Allocations	8	(1)
Allocation of Partnership Income, Deductions, Losses, and Credits to Partners	9	(1)
Basis Adjustments for Operating Items	9	(1)
Limitations on Losses and Restoration of Basis	10	(1)
Transactions Between a Partner and the Partnership	11	(2)
Partnership Distributions	13	(1)
Sale of a Partnership Interest	14	(1)
Optional Basis Adjustments	15	(1)
Electing Large Partnerships	16	(1)
Partnership Elections	17	(2)
Tax Year Restrictions	17	(1)
Cash Method of Accounting Restrictions	18	(1)
Taxation of S Corporations	19	(10)
Qualification Requirements	19	(1)
Election Requirements	20	(1)
Termination Conditions	21	(2)
S Corporation Operations	23	(1)
Basis Adjustments to S Corporation Stock	24	(1)
S Corporation Losses and Limitations	25	(1)
Other S Corporation Considerations	26	(3)
Tax Planning Considerations	29	(2)
Use of Operating Losses	29	(1)
Income Shifting Among Family Members	30	(1)
Optional Basis Adjustment Election Under Sec. 754	30	(1)
Compliance and Procedural Considerations	31	(3)
Partnership Filing Requirements and Elections	31	(1)
Reporting Partnership Items on Form 1065	31	(1)
S Corporation Filing Requirements and Accounting Method Elections	32	(1)
Reporting S Corporation Items on Form 1120S	32	(1)
Comparison of Alternative Forms of Business Organizations	32	(2)
Problem Materials	34
Discussion Questions	34	(2)
Issue Identification Questions	36	(1)
Problems	37	(5)
Comprehensive Problem	42	(1)
Tax Form/Return Preparation Problems	42	(1)
Case Study Problems	43	(1)
Tax Research Problems	44
Taxes and Investment Planning	1	(9)
Investment Models	2	(14)
The Current Model	2	(3)
The Deferred Model	5	(4)
The Exempt Model	9	(1)
The Pension Model	10	(4)
Multiperiod Strategies	14	(1)
Summary and Comparison of Basic Investment Models	14	(2)
Other Applications of Investment Models	16	(9)
Flow-Through Entity Versus C Corporation	16	(4)
Current Salary Versus Deferred Compensation	20	(5)
Implicit Taxes and Clienteles	25	(4)
Problem Materials	29
Discussion Questions	29	(1)
Problems	29
TABLES
1996 Tax Tables and Rate Schedules T-1
APPENDICES
Appendix A Tax Research Working Paper File	A-1
Appendix B Tax Forms	B-1
Appendix C MACRS and ACRS Tables	C-1
Appendix D Glossary	D-1
Appendix E Statements on Responsibilities in Tax Practice (SRTPs)	E-1
Appendix F Index of Code Sections	F-1
Appendix G Index of Treasury Regulations	G-1
Appendix H Index of Government Promulgations	H-1
Appendix I Index of Court Cases	I-1
Appendix J Subject Index	J-1