Research Memo Reminders

1. Research Memo Reminders Bus 223A

2. Format • Facts – relevant ones • Issue – in form of a question • Law – code, regs, cases • Analysis – apply the law to your facts to come up with answer and why that is the correct answer • No need to repeat citations • Be sure to refer to the law you included in memo • Conclusion – answer the question; very short • Next steps – what are you going to do next

3. Law • In your own words – paraphrase • Be sure key points are there • Example: For §163, key words “paid or incurred” • Need to have enough of the facts so we can compare it to our facts and understand why the court reached the conclusion it did. • Need to state court’s holding and WHY it held that way.

4. Example • Burgess v. Comm’r., 8 TC 47 (1947) – taxpayer borrowed funds from Archer. He later borrowed additional funds from Archer to pay interest owed to Archer. The court allowed Burgess to deduct the interest paid. Critique?

5. Example • Burgess v. Comm’r., 8 TC 47 (1947) – B borrowed funds from Archer. B later borrowed $4,000 from Archer to pay $4,136.44 of interest owed to Archer. The $4,000 was deposited into B’s account at a Summit Trust which already had about $3,180 in it. B then wrote several checks from the Summit account including one for the interest owed to Archer.

6. Example - continued • The IRS disallowed $4,000 of B’s payment of interest because it was borrowed from the same lender and so was, in substance, not really a payment (B still owed interest to Archer). • The court disagreed with the IRS. The court stressed that because B commingled the $4,000 with other funds, they lost their identity as funds from Archer. Also, the court noted that B did not solely borrow the money to pay Archer because he paid other bills from his Summit account as well. Thus, the court held that B had made a cash payment and was entitled to the interest deduction in the year paid.

7. How many cases do you need? • It depends! • Are there subtleties in fact patterns that should be addressed? • Are there still questions you have after finding your first “on point” case? (if yes – get more cases to answer your questions) • Will client not like your result and likely need more convincing? If yes, get a few more cases.

8. Add’l Reminders • Include regs in law section – if there is nothing on point to help you, still note that you looked, but there was nothing to address your issue. • When you find old cases or few cases, be sure to use Citator to look for other and more recent cases. • If you use a case where IRS lost (such as Burgess), check Citator to see if there is an A or NA. • If yes, then get the AOD for details.

9. More Reminders • Use primary authority • Use an IRS pub only when you can’t find anything on point. • Don’t use CCH or RIA editorial materials in your law section – go to the primary authority that they are leading you to. • Look for other issues – for example, will Carol be able to deduct interest on her second loan?

10. And … • Proofread! • Use spell check (butt it is knot perfect) • Use complete sentences. • Explain rulings in the past tense. • Use proper citations. • Reread it pretending you are the IRS – are there any holes or flaws?

11. Too Bee Oar Know Two Be I have a spelling checker, It came wit my PC, It plainly marks four my revue Mistakes witch I can knot sea! I’ve run this poem threw hit, I’m sure you wood bee pleased to no, Its letter perfect in it’s weigh, My checker tolled me sew!