Preface xi
Professional and Legal Responsibilities 1
Treasury Department Circular 230 1
Liability as a Tax Preparer 3
Regulation of Accountants 4
Accountants’ Liability 6
Liability under Common Law 6
Tax Preparer Penalties 9
Liability under Federal Securities Regulations 11
Contracts 12
Formation of Contracts 12
Writing and Records 16
Discharge of Performance 21
Passage of Title and Risk Loss 24
Types of Remedies and Formulas for Damage 27
Sales 30
Agency 33
Authority of Agents and Principals 33
Terminating Agent’s Authority 34
Liability 35
Debtor-Credit Relationships 37
Suretyship: Introduction, Creation, and Types 37
Rights of Sureties 38
Defenses of Sureties 39
Cosureties 40
Secured Transactions 41
Collateral 41
Security Agreement 42
Attachment and Perfection 43
Priorities among Claims 45
Default by Debtor 47
Bankruptcy 48
Voluntary Filing—Chapter 7 48
Involuntary Filing—Chapter 7 49
Business Reorganizations—Chapter 11 50
Repayment Plans—Chapter 13 52
Alternatives to Bankruptcy 53
Powers of Bankruptcy Trustee 54
Distribution of Assets 56
Denial of Discharge 60
Federal Securities Regulation 61
Securities Act of 1933 (’33 Act) 61
Exempt Transactions and Securities 63
Emerging Growth Companies 66
Securities Exchange Act of 1934 (’34 Act) 67
FICA and FUTA 74
Federal Insurance Contributions Act (FICA) 74
Selection and Formation of a Business Entity 77
Partnership Characteristics 77
Limited Liability Arrangements 84
Corporations 87
Promoters 90
Directors and Officers 91
Property Transactions 95
Realized Gain or Loss 95
Taxation of Gains and Losses 97
Related-Taxpayer Transactions 98
Special Transactions 99
Sec. 1245 Depreciation Recapture 101
Individual Taxation 102
Individual Income Tax 102
Gross Income 104
Interest 106
Taxation of Income from Business Entities 109
Personal and Dependency Exemptions 129
Filing Status 131
Alternative Minimum Tax (AMT) 133
Personal Tax Credits 137
Accounting Method 141
Depreciation 142
Estate and Gift Tax 146
Tax Due 152
Property Received by Inheritance or Gift 154
Taxation of Estates and Trusts 156
Trusts 157
Computing Taxable Income of Trusts and Estates 160
Corporate Taxation 163
Corporate Income Tax 163
Section 351 Transfer to Controlled Corporation 163
Computing Corporate Income Tax 165
Supplemental Tax Schedules 171
Accumulated Earnings Tax 173
Affiliated Corporation Transactions 174
Nonliquidating Distributions to Shareholders 175
Corporate Complete Liquidation 177
Corporate Reorganizations 178
Section 1244 Stock 179
S Corporations 180
Foreign Tax Credit 188
Family and Medical Leave Credit 188
Partnership Taxation 189
Formation of Partnerships 189
Taxation of Partnerships 193
Distributions 195
Sale of Partnership Interest 197
Termination 198
Index 199
