Unit 1237: Tax Practice and Procedure

1. Introduction to Tax Practice and Procedure

1.1 Overview of Tax Practice

• Definition and scope
• Importance in the tax system

1.2 Roles of Tax Professionals

• Accountants, Enrolled Agents, Tax Attorneys
• Responsibilities and ethics

1.3 Tax Authorities

• IRS and other tax authorities
• Enforcement and compliance mechanisms

1.4 Importance of Compliance with Tax Laws

• Legal and financial implications
• Promoting voluntary compliance

2. Taxpayer Rights and Responsibilities

2.1 Taxpayer Rights

• Right to be informed
• Right to privacy and confidentiality
• Right to appeal and dispute resolution

2.2 Taxpayer Responsibilities

• Filing accurate and timely returns
• Maintaining proper records
• Responding promptly to IRS notices

2.3 Filing Requirements and Deadlines

• Types of tax returns
• Extensions and penalties for late filing

3. Tax Planning Strategies

3.1 Goals of Tax Planning

• Minimizing tax liability legally
• Enhancing after-tax income

3.2 Common Tax Deductions and Credits

• Itemized vs standard deductions
• Common tax credits (e.g., Earned Income Credit, Child Tax Credit)

3.3 Tax-Deferred Investments

• Retirement accounts (401(k), IRA)
• Education savings plans

3.4 Business Tax Planning

• Entity selection and tax implications
• Depreciation and expense timing

4. IRS Audits and Examinations

4.1 Understanding the Audit Process

• Types of audits (correspondence, office, field)
• Selection criteria and triggers

4.2 Examination Techniques

• Information requests
• Interview procedures

4.3 Responding to Audit Inquiries

• Documentation preparation
• Representation rights

4.4 Potential Outcomes of Audits

• No change, agreed adjustments, appeals
• Penalties and additional taxes

5. Tax Dispute Resolution

5.1 Administrative Appeals

• Appeals process within the IRS
• Preparing for hearings

5.2 Mediation and Alternative Dispute Resolution

• Procedures and benefits

5.3 Tax Litigation

• Tax court process
• Role of tax professionals in litigation

5.4 Strategies for Resolving Tax Controversies

• Negotiation and settlement
• Documentation and compliance

6. Penalties and Interest

6.1 Types of Penalties

• Failure to file
• Failure to pay
• Accuracy-related penalties

6.2 Interest Calculations

• How interest is assessed
• Impact on tax liabilities

6.3 Avoiding and Mitigating Penalties

• Reasonable cause and good faith
• Penalty abatement requests

7. Tax Compliance Programs

7.1 Voluntary Disclosure Programs

• Purpose and process
• Benefits for taxpayers

7.2 Tax Amnesty Initiatives

• Eligibility and terms
• Impact on resolving tax liabilities

7.3 Other Compliance Assistance Programs

• Payment plans
• Offer in compromise

8. Tax Ethics and Professional Responsibility

8.1 Ethical Considerations in Tax Practice

• Confidentiality and privacy
• Avoiding conflicts of interest

8.2 Professional Responsibilities

• Competence and diligence
• Compliance with Circular 230

8.3 Consequences of Ethical Violations

• Sanctions and penalties
• Loss of professional credentials

9. Tax Law Updates and Changes

9.1 Tracking Legislative Changes

• Recent tax reform acts
• Impact on taxpayers and practitioners

9.2 Regulatory Updates

• New IRS rules and procedures
• Court rulings affecting tax practice

9.3 Incorporating Updates into Practice

• Continuing education
• Advising clients on changes