Guide use corresponding numbers from Issue(s) section

Guide
to Prepare File Memos and Client Letters

Research
Memo

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Purpose:
To summarize the facts, issues and conclusions of the research topic to enable
a review of the research activities by the researcher’s superiors and to be
reference material for subsequent examinations of the research topic for future
similar situations.

Attachments
to memos should only be the most important and pertinent primary source
supporting documents.

Utilize
template that includes the firm name, location, date field, headings, and researcher
and reviewer name fields for the memo. The standard headings include:

–         
Facts

–         
Issue(s)

–         
Conclusion

–         
Authorities

–         
Analysis
and Summary

–         
Actions
to Be Taken, and

–         
Recommendations

Facts
section includes:

–         
Brief
summarization of relevant facts directly related to the issue(s)

–         
Include
how facts were obtained

o  
Annual
client tax package

o  
Face-to-face
meeting on specific date

o  
Phone
call on specific date

o  
Email
on specific date

Issue(s)
section includes:

–         
Directly
identify the issue(s) using technical tax terms

o  
If
multiple issues, number each one

–         
Question
or statement format is acceptable

Conclusion
section includes:

–         
Directly
and briefly state the conclusion for each issue identified

o  
If
multiple issues, use corresponding numbers from Issue(s) section

–         
Do
not include the reason for the conclusion

–         
Do
not include citations for the conclusion

Authorities
section includes:

–         
Complete
citations for each issue identified

o  
If
multiple issues, use corresponding numbers from Issue(s) section

–         
Cite
primary sources (statutory, administrative and judicial)

–         
Do
not cite secondary sources to support conclusion

–         
Do
not cite IRS Publications to support conclusion

Note: If there are 2 or less primary sources,
authorities section does not have to be included. The full citations must be
included in the Analysis and Summary section.

Analysis
and Summary section includes:

–         
Thorough
review and evaluation of pertinent laws

–         
Detailed
and complete conclusion of each issue identified

o  
If
multiple issues, use corresponding numbers from Issue(s) section

–         
Include
explanations and justifications for the conclusion reached

–         
Include
citations within detailed conclusion

o  
Full
citations, if required

–         
Discuss
strengths and weaknesses of tax argument

Actions to
Be Taken section includes:

–         
Prepare
results with client via client letter

–         
Schedule
a meeting with client to review results, if necessary

–         
File
appropriate documentation in client file

–         
Prepare
tax return, if return is pending results of issue

Recommendations
section includes:

–         
Advise
client of any immediate changes required

–         
Advise
client of possible tax strategies

Client
Letter

Purpose: To
provide a general, plain language conclusion to the client of the issue
identified in a sophisticated and professional manner.

The letter
should be prepared in a paragraph format and should not exceed 2 pages, unless
the issue identified is unusually complex and requires a lengthy explanation.

Utilize
template that includes the firm name, location, date field, client name and
address field, and client salutation.

1st
Paragraph – Objective and Scope of Research:

–         
Thank
the client for requesting advice on the specific issue

–         
Provide
a quick answer to the issue

o  
No
more than one sentence per issue

o  
If
conclusion is unfavorable, provide a buffer

§ 
I
am sorry to report

§ 
Unfortunately

2nd
Paragraph – General Summary of Results

–         
Generalize
the sources

o  
Court
cases

o  
IRS
position

o  
Tax
Court position

–         
Brief
explanation of how the information in these sources directly relates to the
research issue

–         
Very
briefly mention next possible courses of action

o  
If
unfavorable, file for litigation

o  
If
favorable, tax implications or requirements

3rd
Paragraph – Facts Presented by Client

–         
Specify
the source facts were obtained from

o  
Annual
client tax package

o  
Face-to-face
meeting on specific date

o  
Phone
call on specific date

o  
Email
on specific date

–         
Summarize
the facts as originally explained by the client

4th
Paragraph – Critical Source of Law Summary

–         
Provide
specific explanation of the justifications behind the conclusion

–         
Ensure
all issues have been addressed

–         
Ensure
conclusions are explicitly stated

5th
Paragraph – Implications of Results

–         
Specify
concrete next steps

–         
Advise
as to appropriate changes that could result in a more favorable outcome

6th
Paragraph – Assumptions and Limitations REQUIRED

–         
Explicitly
state that conclusions are based on the facts as presented by the client and
the applicable income tax law as of the date of the letter

7th
Paragraph – Closing and Attachments

–         
If
needed, include a reference to any follow-up meetings where letter can be
discussed

–         
If
requested, mention and include any attachments to the letter

 

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