Tax Research

Tax Research

Tax research is a fascinating process of investigation that stimulates tax professionals’ creative thinking. “Tax research is the method used to determine the best available solution to a situation that possesses tax consequences” (Hoffman et al., 2014). Tax professionals help their clients maximize their tax deferrals and tax savings utilizing a proactive approach. Tax researchers use a variety of resources to find the most relevant and reliable solutions for a particular client’s case.

The federal tax authority is composed by primary and secondary sources of the rules of tax law. The primary sources of tax authority contained statements from the three branches of the government: legislative, administrative and judicial (Hoffman et al., 2014). The primary sources include: statutes, treaties, regulations, rulings and judicial decisions. The secondary sources were established to support the primary sources by locating, explaining, analyzing and interpreting them. Moreover, secondary sources are comprised of unofficial publications, such as tax treatises, tax journals, and tax periodical literature (Hoffman et al., 2014).

The consultative approach is the best approach a tax professional can use in his/her practice. The consultative approach will allow the tax professional to gather as much facts from the client as possible to be able to identify potential issues arising from the tax question and consequently, choose the appropriate research tools.

According to Hoffman et al., (2014), tax professionals must follow the six step process for effective tax research.

1. Gather pertinent facts & identify research issues

2. Locate tax authority

3. Interpret and apply authority

4. Develop conclusions and recommendations

5. Communicate results effectively

6. Follow-up

The most efficient and effective way to conduct tax research is by utilizing electronic databases. Online searches can be reliable, accurate and time effective when retrieving...