Step 2

Getting Correct Information from the IRS (And Others)

A good audit-proofer knows the tax laws are complicated; there are too many rules; and that the average person cannot possibly spend the time to become an expert. But you want to do the best you can to figure your taxes at a minimum level and your refund at a maximum amount without taking unnecessary risks. This means taking every deduction that can be taken according to tax law.

AUDIT-PROOFER'S STRATEGY RULE

Use the IRS's vast array of information services to keep informed and on top of the tax laws. In other words, use the IRS to beat the IRS.

"Tax law" is really a generic term that has many references that all originate with the Internal Revenue Code. The "Code," as it is called by tax practitioners and IRS employees, is literally thousands of pages long and contains some of the world's most confusing and ambiguous language. It is also the bedrock or the central document upon which "tax law" evolves. In the tax field the Code is the "tax law." But in a generic sense, the term encompasses the whole body of legislative, judicial, and executory rulemaking.

Tax law also includes such IRS-issued peripheral items as information letters, regulations, revenue rulings, revenue procedures, private letter rulings, delegation orders, written determinations, closing agreements, and technical advice memorandums. But it doesn't stop there. We also have tax conventions, executive orders, treasury decisions, treasury department orders, statements of procedural rules, and GCMs, or General Counsel Memorandums. Then there are "memorandum decisions" and "regular decisions" of the Tax Court.

To make it even worse we also have opinions by district courts, Claims Courts, Courts of Appeals, and the Supreme Court, with an occasional opinion from the Comptroller General. To confuse things even more, the IRS announces whether or not it will follow the court cases by acquiescence or nonacquiescence.

Even tax lingo becomes part of the tax law. For example, sometimes the IRS will change revenue rulings by clarifying them, but if that doesn't do the trick, then they are amplified. If things get too confusing, the rulings are distinguished, but the IRS always reserves the right to modify them. If a revenue ruling gets really "hairy," it can be revoked, superseded, or obsoleted, not to mention supplemented, or suspended. All in a day's work at the IRS in Washington, D.C.

Now you know, kind of, what tax law is.

1. Where To Go For Answers
2. Exhibit 2-1: IRS Information And Assistance (HTML)
3. Exhibit 2-2: Taxpayer Information Publications
4. Exhibit 2-3: Explore IRS e-file (HTML)
5. Exhibit 2-4: Business Tax Services and Information (HTML)
6. Exhibit 2-5: Taxpayer Assistance Programs (HTML)
7. Exhibit 2-6: Taxpayer Education Programs (HTML)

Or, move on to Step 3: Knowing What The IRS Will Be Looking For

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© 1986, 1998 to 2002, Jack Warren Wade, Jr.