Judicial Sources for Tax Research

1. Judicial Sources for Tax Research Professor Annette Nellen Bus 223A

2. Primary Authority • From Government: • Legislative sources • Administrative sources • Judicial sources • Different than secondary authority: • Can rely upon it • Need to interpret it

3. Primary Authority from Legislative Branch • Internal Revenue Code • Public laws • Legislative histories Similar for state legislatures: • Example – California • Revenue & Taxation Code • Laws • Background reports/analysis

4. Primary Authority from the Administrative Branch • Regulations • Revenue Rulings • Revenue Procedures • Notices • Announcements • Letter rulings • Chief Counsel rulings • Actions on decision (AOD)

5. Judicial Sources

6. Tax Court • Regular vs. Memorandum • Golsen rule • Look to precedent in jdx where an appeal would lie • May result in conflicting Tax Court decisions • Don’t have to pay first to go to Tax Court

7. Other trial courts • District court and Ct of Federal Claims • Must first pay deficiency and then sue for refund • Judges are not tax experts • Jury available in District Court if issue of fact

8. Appellate Courts • 12 regional courts of appeals • CA is in 9th Circuit • Judges are not tax experts • U.S. Supreme Court • About 5 – 12 tax cases per year • Losing party at court of appeal level files writ of certiorari to have Ct hear the case

9. Citation examples • Gold Coast Hotel & Casino, et al. v. U.S., 98-2 USTC ¶50,800, 82 AFTR2d 98-6714, 158 F.3d 484 (9th Cir.) • Hallmark Cards v. Comm’r., 90 TC 26 (1998).

10. Key to proper citations • Readers should be able to tell from citation: • Name of case • Year decided • Court that heard it • Where to find it (a citation) • Format guidelines • Harvard Bluebook • ABA guide • Textbook appendix • For memos to file – just be sure looks like prior slide and for other items, articles, legislative histories, etc. – reader should know what you’re citing, year, source and where they can find it.

11. Actions on Decision (AOD) • Issued when IRS loses case (but they don’t have to issue one) • Except a US Supreme Court case • Lets public know if they will follow (acq) or not follow (nonacq) the case + brief explanation of why • Acq (A) or Nonacq (NA) also in Citators and IRB and CB • Always look for one when you rely on a case that IRS lost!!!!!!

12. Meaning of IRS NA to a case • Just means that IRS won’t follow it unless t/p is in same jurisdiction as the t/p. • But is NA to Tax Court decision – won’t follow it for anyone • Reason – IRS thinks its interpretation is correct and it is hoping to get to another court with another taxpayer to prove their point again or they hope to get Congress to clarify law going forward.

13. Relevance to your research • If find a case on point, but IRS has NA: • Can still use it • Helpful to look for add’l cases • Check the Citator for recent applications of the case • Look in secondary authorities for other cases • If use it, let client know. • Note the NA in your research. • Btw – also note any Acq in your memo

14. Citation if case has A or NA • Osteopathic Medical Oncology and Hematology v. Comm’r., 113 TC 376 (1999), acq in result only, 2001 CB xv • The AOD should also be included in your law section. • If you want to see an AOD, search for the Osteopathic one in RIA or CCH.

15. Citing Primary Authority in Research Memo • Be sure it is on point • Explain clearly and concisely • Provide citation so that reader of memo knows: • Age • Where it came from • How to find it • Examples: • Las Vegas Land & Water Co. v. Comm'r., 26 T.C. 881 (1956) • Office Max, Inc. v. U.S., 93 AFTR 2d 2004-1190, 2004-1 USTC ¶70,216, 309 F.Supp2d 984 (2004 ND Ohio)

16. Legal terminology • Look at context of how used • Look it up in a law dictionary • Black’s Law Dictionary – available in most libraries • On line legal dictionaries (will do this for your Supreme Court case project)

17. Sample terminology • Per curiam – by the court, an opinion of the who court rather than just one judge • Petitioner – person who files the petition for the court to hear their case • Pro se – for himself, used when a person represents themselves in court (without legal counsel)

18. Citators • Tools of commercial publishers to let you know how a case was used subsequently by courts and in IRS rulings • You have access to: • RIA Citator • CCH Citator

19. Citator terminology • Cited case – case you are looking up to see how it was used subsequently • Citing case – the later case that mentions your case

20. Benefits of a Citator • Check if the case is still cited today. • Look at citing cases to get better understanding of the legal analysis and if any changes have occurred. • Check if there is a case on the topic in your jurisdiction. • If IRS lost, is there an Acq or Nonacq? • Was the case appealed? • Quick view of the history of the case (trial court to appelate court – dates, etc.) • Has a Revenue Ruling or Revenue Procedure been modified or superceded by the IRS?

21. RIA Citator Features • Lists all citing cases • Tells how cited • Ties to headnotes RIA has at start of each case • Headnotes are numbered and the numbers tie to the Citator • Headnotes are written by RIA, not court • When click on citing case, takes you to spot in citing case where cited case is mentioned (rather than to first page of case)

22. CCH Citator Features • Does not list all citing cases. • Does not tell you how used. • When click on case link, takes you to first page of the citing case. Use search or “find” to find cited case. • Easy to find history – look for bullets in the list of citing cases. • Links to annotations on cited case.

23. The list of citing cases • Typically in order of highest authority – so any citing Supreme Ct cases first and PLRs at end of list. • RIA – sort by headnote numbers • What if no headnote number listed? • CCH – sorts by history of the cited case (see later slide)

24. CCH Citator Understanding the list of citing cases: • CA-6-- (aff'g BTA) 40-1 USTC ¶9176 , 108 F2d 753 Wieboldt CA-7, 40-2 USTC ¶9525 , 113 F2d 384 • BTA-- Dec. 9923-A December 30, 1937 The Weiboldt case cites to the 6th circuit decision of Helvering v Hammel, not to the S. Ct decision of Hammel.

25. Add’l points – using Citators • RIA and CCH citators – federal tax cases only • Usually gov’t name omitted form the citations • EX – Hallmark • Rather than Hallmark v. Comm’r • If case name starts with gov’t official name, t/p name used instead. EX • Hammell: Helvering v.

26. Summary • 3 trial courts • 2 levels of appellate courts • Use proper citation format • Always use citator for cases you are using in your memo • If IRS lost – ck for A or NA and get the AOD • Take time with Citator to see how citing cases listed and what else the publisher is telling you