Disturbing Information!

[Super Mom]

As a Certified Bookkeeper, I have a CPE requirement and was working on that tonight. I learned that per court cases, the IRS is not legally bound by anything in their publications, guidance, or FAQS on their website!! They are only bound by the "Internal Revenue Bulletin". I wrote a letter to Donald Trump informing him of this fact if he does not know. I have been using the taxbook for many years now, it usually refers to the publications, right? I know that often code and court cases are referred to, but it seems to be mostly designed from publications. Maybe those hard to read research materials that refers to laws and court cases would be better?????

I mean, really, in all the years I have been preparing tax returns, I most often use the publications to back up what I do. Now, I'm understanding they are not legally binding in an audit situation? REALLY????

[taxea]

As a Certified Bookkeeper, I have a CPE requirement and was working on that tonight. I learned that per court cases, the IRS is not legally bound by anything in their publications, guidance, or FAQS on their website!! They are only bound by the "Internal Revenue Bulletin". I wrote a letter to Donald Trump informing him of this fact if he does not know. I have been using the taxbook for many years now, it usually refers to the publications, right? I know that often code and court cases are referred to, but it seems to be mostly designed from publications. Maybe those hard to read research materials that refers to laws and court cases would be better?????

I mean, really, in all the years I have been preparing tax returns, I most often use the publications to back up what I do. Now, I'm understanding they are not legally binding in an audit situation? REALLY????

They are bound by the Internal Revenue Code not "bulletin". That is why you use the taxbook to cite the Code # in your responses or use to justify your position.

[Uncle Sam]

Disturbing Information

IRS Publications are NOT SUBSTANTIAL AUTHORITY, and never have been.
It's the Internal Revenue Code, Regulations, Revenue Procedures, Revenue Rulings, and U.S. Tax Court Decisions that are considered to be substantial authority for determining proper treatment of tax issues.

[kathyc2]

I wrote a letter to Donald Trump informing him of this fact if he does not know.

Trump has declared that he knows more about taxes than anyone in the history of the world. I knew this, so by default he would need to know it or he is telling an "untruth".

[ATSMAN]

Only in America!

Now you know why many people distrust the Govt!

[New York Enrolled Agent]

Actually, the full list of the sources of authority are contained in the income tax regulations at 1.6662-4(d).

Many of those authorities are published in the internal Revenue Bulletin - hence the reference to the IRB. The cited regulation details the nature of analysis to determine if substantial authority exists for a tax position.

The Tax Court often intones "taxpayers who rely on IRS publications do so at their own peril". 

[Rapid Robert]

I mean, really, in all the years I have been preparing tax returns, I most often use the publications to back up what I do. Now, I'm understanding they are not legally binding in an audit situation? REALLY????

Are you an Enrolled Agent, state CPA or attorney? Or, perhaps, AFSP participant? Being covered by Circ. 230, I would expect those categories of tax professional to have a clear understanding of "substantial authority" beginning early in their careers.

[Jiggers]

While IRS Pubs are not substantial authority, most IRS examiners will accept the information from them in support of your position during an audit.

[New York Enrolled Agent]

While IRS Pubs are not substantial authority, most IRS examiners will accept the information from them in support of your position during an audit.

That should read: While IRS Pubs are not authority, most IRS examiners will accept the information from them in support of your position during an audit.

This is not nit-picking.

Substantial Authority is a tax preparation standard. The above cited regulation contains: The substantial authority standard is an objective standard involving an analysis of the law and application of the law to relevant facts

Substantial authority requires an evaluation of the weight of authorities "for" and "against". READING the regulation is essential to understand the concept.

[admin]

Update

TheTaxBook is written and organized similar to IRS Publications because IRS Publications were written by IRS employees who used the Internal Revenue Code, Regulations, Revenue Rulings, Court Cases, and other substantial authority to interpret the tax code. IRS employees on the writing committees of these publications work closely with those who write Treasury Regulations and other substantial authority published in the Internal Revenue Bulletin. No group of writers is closer to the official IRS interpretation of the law than those who write and update the IRS Publications. These publications are scrutinized by those in the know and any errors and interpretations of tax law are usually discovered very quickly and corrected.

As to all updates in TheTaxBook, those are written directly from Public Laws, Revenue Procedures, Court Rulings, and other substantial authority as new information is released. IRS Publications that cover new tax law are generally released long after publication deadlines for TheTaxBook. As a result, TheTaxBook authors are trained and experienced in researching directly from the Internal Revenue Code, Treasury Regulations, and other substantial authority. TheTaxBook authors then re-write that information in understandable English. Later, TheTaxBook updates are then cross-referenced with the revised IRS Publications when the IRS eventually updates their information to ensure TheTaxBook interprets tax law changes similar to how IRS Publication writers interpret them. When information in IRS Publications appear to contradict substantial authority, such as a Tax Court decision that contradicts something published in the IRS Publications, TheTaxBook publishes both positions so that the reader can better understand the issue.

[Super Mom]

TheTaxBook is written and organized similar to IRS Publications because IRS Publications were written by IRS employees who used the Internal Revenue Code, Regulations, Revenue Rulings, Court Cases, and other substantial authority to interpret the tax code. IRS employees on the writing committees of these publications work closely with those who write Treasury Regulations and other substantial authority published in the Internal Revenue Bulletin. No group of writers is closer to the official IRS interpretation of the law than those who write and update the IRS Publications. These publications are scrutinized by those in the know and any errors and interpretations of tax law are usually discovered very quickly and corrected.

As to all updates in TheTaxBook, those are written directly from Public Laws, Revenue Procedures, Court Rulings, and other substantial authority as new information is released. IRS Publications that cover new tax law are generally released long after publication deadlines for TheTaxBook. As a result, TheTaxBook authors are trained and experienced in researching directly from the Internal Revenue Code, Treasury Regulations, and other substantial authority. TheTaxBook authors then re-write that information in understandable English. Later, TheTaxBook updates are then cross-referenced with the revised IRS Publications when the IRS eventually updates their information to ensure TheTaxBook interprets tax law changes similar to how IRS Publication writers interpret them. When information in IRS Publications appear to contradict substantial authority, such as a Tax Court decision that contradicts something published in the IRS Publications, TheTaxBook publishes both positions so that the reader can better understand the issue.

Thank you so much! That puts my mind at ease! I love the taxbook much better than any other research material I have used! I am not afraid to admit that at times some of those other materials can be pretty hard to understand!