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Some Notes on Research Materials and Tips

May 6th 2010
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Back in the dim reaches of time, when I started my tax practice, a full law library was much too expensive for a young accountant on her own. Just so you understand the enormity of the costs, $3,000 in those days, could buy a decent compact car. A similar car today is being sold for around $20,000. Probably more.

My minimum research library back then consisted of these things, which averaged less than $200 per year (about one month's rent):

1) CCH paperback set of the Tax Code & Regs. (renewed every 2-3 years) (about $250 then -$111.50 now)

2) Annual CCH US Master Tax Guide (about $25 then, - $84 now)

3) Annual CCH California Master Tax Guide (about $25  - $84 now)

4) Boardroom's Tax Hotline (a $29 God-send. unfortunately, no longer in print)

I loved that Tax Hotline! It came monthly, about 16 pages, with a clean format and bright graphics, and CITATIONS about Tax Court cases, new regs, new laws and useful articles about tax procedures and planning tips. That single, little publication was my life-saver. It made me look smart to my peers - and to my clients. It was a very sad day when Boardroom stopped publication and merged it into BottomLine Wealth, then back into their main publication BottomLine Personal.  The best parts of the Tax Hotline were the IRS WINS and the IRS LOSES section.  Sigh.

Even with such good, handy tools, there were times I absolutely needed a research library. So I'd arm myself with a couple of rolls of dimes (for the photocopy machine) and head over to the Santa Ana Law Library over near the Courthouse. The little glassed-in room in the back corner must have been a well-kept secret. I didn't often see anyone else in there. But that Law Library had the only up-to-date Tax Library within a 25-50-mile radius. (Even UCI and CSUF, the two major colleges didn't have such current material.)  It was awful when I moved to Los Angeles and couldn't find anything nearly as complete or convenient (CSUN's Tax Library was generally about 2 years out of date - and UCLA was a pain to access). One of my favorite tools back then (OK, OK, this was about 30 years ago - you know, when we had to trudge barefoot through the snow for miles to get to the nearest sign of civilization. Ooops, sorry, wrong tall tale.).. Back to the story.  One of my favorite tools back then were the IRA folios. Each one contained an in-depth - complete discussion on a single topic, with all the citations you could ever want.

Doing research back then meant investing at least half a day in the trip. So I would try to save up my needs and schedule it in such a way that I could invest the day doing research for several clients on several issues at once.  When you consider the investment in billable hours - that was an expensive day. Thank goodness I could actually bill for all time!

Today, I can do that same research, right here at my desk, in minutes. Heck, on the spur of the moment, even. I no longer invest in a print copy of the Tax Code - it goes out of date by the time it's printed. I do get the Master Tax Guides, though.  In fact, even my favorite handy reference source is severely out of date by the time it arrives - The TaxBook, Deluxe version. I get this because it covers Individuals, as well as Corporations, Partnerships, etc., all in one handy place. At least they maintain a thorough set of updates online. In fact, you can print out updated pages for the book anytime you need them. (There's an access code in the back of each book.) [To get a discount, use Coupon Code 817 ]

Doing research now is so much easier than it ever was. Everything is online. Much of it is available for free. Or your tax software provider has bundled your research tools into a nice, cozy package - with lots of up-to-date online tools.

Just yesterday I needed to address an issue where IRS disallowed a client's tax credit. (This will be the topic of my May MarketWatch column, so read that later this month.) Rather than heading for the Tax Code or the Regs, I wanted to go directly to the Tax Legislation itself and see the raw wording. It literally took me minutes to find what I needed and make my notes. (As it happens, I keep a list of the new tax laws handy on my Quick Look-Ups page. It is linked to the legislation and to IRS notices and/or relevant explanations. So it takes seconds to find my starting point.  If you log into TaxMama's Family Quick Look-Ups, it's the PDF file of the 2009 Update. The links in that PDF file work.)

[Note: the free Quick Look-Ups page has links to the Tax Code, IRS and State forms, per diem rates, the EA Exam and more. The Family Quick Look-Ups also includes the Regs, Tax Court, Non-Profit resources, several more Tax Code resources, current legislative updates, and more. Also info about the EA Exam and the Tax Court Exam - which will be given in November of this year.]

My corporate client is supremely happy with the quick and positive results of my research. I didn't have to keep them hanging for days or weeks until I could make the trek to the Law Library. The morning after the question arose, he got detailed information the law (with links to the citations) and instructions on what information to collect from his customers to refute IRS's disallowance (disallowal?) of the tax credit. I'm a hero. They're happy to give me a lot of money for this - not just my billable 15 minutes x my hourly rate.

And to top it all off, since all my staff happened to be in-house at the same time, I was able to invest another 15 minutes showing my staff the precise process to do this kind of research, how to document and link the citations so anyone reading their notes can look up the raw source of the information.

The fact is, this note took longer to write (and link all the details), than it took to do my research and write up the instructions to my clients.


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