Tax ResearchTwo of the Primary Resources

Student Presentation by a library student

2 (of 3) Primary Resources

The Internal Revenue Code, Title 26 of the United States Code

And …

The Treasury Regulations, Title 26 of the Code of Federal Regulations

When starting a federal taxation research project a good place to start is with the Internal Revenue Code

Be sure to consult a current version of the code

Tax Research

Tax research, an example …

Have you ever needed to know …

What it means to allocate income and deductions among taxpayers?

Start by consulting the Code, section 482.

IRC § 482, Allocation of income and deductions among taxpayers.

In any case of two or more organizations, trades, or businesses (whether or not incorporated, whether or not organized in the United States, and whether or not affiliated) owned or controlled directly or indirectly by the same interests, the Secretary may distribute, apportion, or allocate gross income, deductions, credits, or allowances between or among such organizations, trades, or businesses, if he determines that such distribution, apportionment, or allocation is necessary in order to prevent evasion of taxes or clearly to reflect the income of any of such organizations, trades, or businesses. In the case of any transfer (or license) of intangible property (within the meaning of section 936(h)(3)(B)), the income with respect to such transfer or license shall be commensurate with the income attributable to the intangible.

Section 482 seems straight forward. Only two sentences.

Is tax law really this easy, just two simple sentences explaining how to allocate income and deductions?

H-E-Double Hockey Stick No!!!

If it were that easy politicians would stop complaining about it, and students would stop studying it!

To ensure you are getting the information your professor or client needs …

Always consult the Regulations!

All taxation students must get in the habit of consulting the Regulations while in school!

Failure to do so while practicing can be professional misconduct!

Internal Revenue Code Section 482 is explained in the Treasury Regulations sections 1.482-0 through 1.482-9T.

You may be asking yourself …

How much new information can the Regulations add regarding the 2-sentence long section 482?

Well, I’m glad you asked …

Regulation section 1.482-0 contains an 18 page table of contents for Section 482’s regulations.

Yes! You read that correctly, 18 pages that consist only of a table of contents!

Regulation section 1.482-0T contains a similar table of contents for the temporary regulations explaining section 482!

Yes! There are temporary regulations that alter the permanent regulations that expand upon section 482!

The regulations that explain Code section 482 are roughly 200 pages in length, all to explain the 2 sentence long Code section 482.

All 200 pages will contain itty bitty print and long sentences

Consulting the Code of Federal Regulations is important in other areas of the law as well.

As an example …

The importation of items into the United States is governed by Title 19 of the United States Code, Customs Duties

Title 19 of the United States Code, Customs Duties, is explained by its very own set of regulations …

Title 19 of the Code of Federal Regulations, the Customs Regulations

An example of Customs research …

If you ever need to know where to import antiques, where do you look?

Could all the information be found in section 10.53, which is captioned as “Antiques?”

Of course not! That would be too easy.

Our lawyers and Customs Brokers need jobs after all

So, where do we look then?

Look to section 12.26, captioned as …

Importations of wild animals, fish, amphibians, reptiles, mollusks, and crustaceans; prohibited and endangered and threatened species; designated ports of entry; permits required.

What does the import of antiquities have to do with the import of wildlife?

Certain antique items might be made from the pelts, bones or ivory of endangered species.

Subsection (g)(2) of section 12.26 answers our question

19 C.F.R. § 12.26(g)(2)Any antique article imported under Sec.

10.53(g) of this chapter shall be entered at one of the following ports:

Boston, Massachusetts; New York, New York; Baltimore, Maryland; Philadelphia, Pennsylvania; Miami, Florida; San Juan, Puerto Rico; New Orleans, Louisiana; Houston, Texas; Los Angeles, California; San Francisco, California; Anchorage, Alaska; Honolulu, Hawaii; O'Hare International Airport, Chicago, Illinois

One more thing to be aware of …

The name of a code or regulation section is called a caption

In a perfect world a caption would accurately reflect two things…

What type of law is contained in the section,

And,

Who the law affects, and in what circumstances

However,

Intel Corporation v. Advanced Micro Devices, Inc. 542 U.S. 241

“A statute's caption, however, cannot undo or limit its text's plain meaning.”

Therefore, when conducting federal taxation research, tax students must be aware of the information contained in the Code or Regulations, rather than what a section’s caption alludes to

Remember,

The Code often used by students is contained in a single book

The Regulations used by students, however

Are often contained in 8 books

All students of taxation or any other area of the law need to be aware of the different Titles in the Code of Federal Regulations,

And must get in the habit of regularly consulting them while they are in school.