Dominican University

School of Business

Accounting 320:  Federal Taxation of Individuals

 

 

Instructor:  Maggie Bartold

Phone:  312-252-7626

Fax:  312-263-6935

Email:  mbartold@bk-cpa.com

(Students should type “Dominican” in Subject Line)

Office Hours:  TBD; By Appointment

Prerequisites:  Acct 101

 

 

 

Course Description:

 

Accounting 320 represents an exciting and challenging introduction to the federal taxation of individuals.  The course emphasizes fundamental taxation theory and focuses on how tax information is prepared and used.  No previous coursework or work experience in taxation is assumed.  We begin with a review of the federal tax system and tax research materials and techniques.  We proceed by examining the content and significance of various tax provisions related to gross income, deductions and losses, and credits.  We conclude with a review of the following topics:  property transactions, alternative minimum tax, and accounting periods and methods.  Students will reinforce their understanding of course concepts through problem solving, class discussions, in-class exercises, technology projects, research projects and presentations.

 

Course Goals and Objectives

 

Upon completion of the course, the student will have:

  1. Developed an understanding of a broad range of tax concepts and types of taxpayers.
  2. Developed an appreciation for the role of taxation in the business decision-making process.
  3. Developed an ability to conduct basic tax research and tax planning.
  4. Developed an appreciation for the professional standards and ethical issues related to tax practice.
  5. Developed an understanding for the interrelationships and differences between financial accounting and tax accounting.

 

(adapted from the AICPA Model Tax Curriculum)

 

From a specific content perspective, students will understand:

  • Some of the criteria for selecting a tax structure and various economic, social, equity, and political considerations that justify aspects of the tax law.
  • How tax laws are administered, including the roles played by the IRS and the courts
  • How to locate and work with various tax law sources when performing research
  • How to identify planning opportunities associated with the individual tax formula
  • The concepts of gross income and various tax planning strategies for minimizing gross income
  • The circumstances under which various items are excludible from gross income
  • How to differentiate between deductions for and from adjusted gross income and the associated relevance
  • Internal Revenue Code deduction disallowance provisions, including those associated with public policy limitations, hobby losses, excess executive compensation, personal and capital expenditures, related party transactions, and expenses related to tax-exempt income
  • How to distinguish between various deductible and nondeductible losses of individuals, including bad debt and casualty and theft losses
  • The tax impact of net operating losses and carryback and carryover provisions
  • How to determine the amount of cost recovery under ACRS and MACRS
  • How and when to use a Section 179 expensing election and the alternative depreciation system
  • How to identify planning opportunities associated with cost recovery, amortization and depletion
  • The tax treatment of various employee and self-employment related expenses, including transportation, education and entertainment, moving and retirement account contributions
  • The business and personal expenses that are deductible as itemized deductions
  • The limitations on certain itemized deductions and the associated tax planning opportunities
  • How passive loss and at-risk rules limit deductions for losses
  • How to distinguish between refundable and nonrefundable credits
  • The various tax credits that are available primarily to individual taxpayers
  • How to compute realized gain or loss on property transactions
  • How to distinguish between realized and recognized gain or loss
  • How to determine basis for various methods of asset acquisition
  • The rationale for various disallowance and nonrecognition provisions, including those associated with like-kind exchanges, gains on the sale of a personal residence, and the involuntary conversion of property
  • How to distinguish capital assets from ordinary assets and the holding period for capital assets
  • The holding period for capital assets and the tax treatment of capital gain or loss for noncorporate taxpayers
  • How to calculate Section 1231 gain or loss and how the Section 1245 and Section 1250 recapture provisions impact gain or loss computations
  • The rationale for the alternative minimum tax, how to identify tax preference items, and how to compute AMT for individuals
  • The relevance of the accounting period concept, the different types of accounting periods, and the limitations on their use

(adapted from:  Willis, Hoffman, Maloney, and Raabe, West Federal Taxation:  Comprehensive Volume, 2005 Edition, Thomson South-Western 2005)

 

Consistent with departmental goals established by the School of Business, students will also enhance their:

  • Appreciation for ethical and socially responsible behavior within the workplace (GI).
  • Ability to communicate effectively in written and verbal formats (G2)
  • Ability to utilize technology and electronic learning to address business applications (G3)
  • Quantitative, analytical and critical thinking skills (G4)
  • Understanding of global issues faced by organizations (G5)

 

Note:  References to the School of Business Goals (G1-G5) are bolded in the course calendar section of the syllabus.

 

Course Materials

 

Required:  Smith, Harmelink, and Hasselback, CCH Federal Taxation, 2007 Edition, CCH Incorporated 2006

 

Optional:  Wall Street Journal Subscription

 

Course Requirements

 

Examination One:                              25%

Examination Two:                              25%

Weekly Quizzes:                                10%

Tax Return Problems:                        10%

Research Project and Presentation:  10%

Participation:                                      20%

 

 

 

 

 

Grading:

 

A         94-100%

A-        90-93.9%

B+       87-89.9%

B         83-86.9%

B-        80-82.9%

C+       77-79.9%

C         73-76.9%

C-        70-72.9%

D         60-69.9%

F          Below 60%

 

Weekly Quizzes

 

Weekly quizzes will be administered.  Scores for your quizzes will be factored into your grade by including your ten highest scores.  No makeup quizzes will be given.  Quizzes will be structured in CPA Exam format to give students an introduction to what they can expect when sitting for the Exam. 

 

Examinations

 

Examinations will be in-class.  Students should bring a non-programmable calculator to each exam.  Exams can only be re-scheduled with my prearranged consent. (This will generally mean an exam being taken EARLIER than the designated date on the syllabus.)

 

Tax Return Problems

 

Real life tax return problems will be worked on in groups or individually.  These problems will provide the student with an idea of what they will encounter during a tax internship or entry-level tax staff position after graduation.

 

Tax Research Problem and Presentation

 

Students will select a research problem from several options.  A two—three page paper will need to be handed in by each student.  The paper will be formatted to reflect the type of research presentation that could be expected of an entry-level staff professional.  A 5-10 minute presentation on the topic will also be required.  Students may work in groups but must turn in an individual tax research memo and participate equally during oral presentations.  Groups and topics will be determined during the first several weeks of class.

 

 

 

 

Participation

 

Your class participation grade will reflect the quality and consistency of your contribution to discussions related to issue identification and decision-making problems at the end of each assigned chapter in the textbook.  Mere attendance does not represent participation.  Frequent absences will negatively impact your participation grade.

 

Websites and Web-Based Resources

 

Students should familiarize themselves with the IRS and Illinois Department of Revenue websites.  We will discuss navigation of these sites in class.  Students will conduct research for their project and find answers for the Real Life Tax problem assignments through the materials on these websites.

 

Other Requests

While I do not specifically grade on attendance, please make every effort to attend all sessions and to actively participate.  Your involvement will assist me in determining your understanding of the course material.

  • Please demonstrate your professionalism by arriving to class on time, by respecting the comments and questions of your classmates, and by silencing all cellular phones and pagers.
  • Please bring your textbook, handouts and a calculator to each class.
  • Please feel free to contact me with any questions.  I will return voicemails and emails as soon as possible.  Individual meetings can be scheduled upon request.
  • All written assignments will be evaluated on content and writing quality.  Please take advantage of the Dominican University Writing Center in the Library if you need assistance with your writing.
  • Please allow me to make minor adjustments to the syllabus as circumstances require.

 

For your convenience, I have included the University’s Academic Integrity Policy below:

 

Academic Integrity Policy

 

Students of the university must conduct themselves in accordance with the highest standards of academic honesty and integrity.  Failure to maintain academic integrity will not be tolerated.  The following definitions are provided for understanding and clarity.

 

Definitions of Plagiarism, Cheating and Academic Dishonesty

Student plagiarism is the deliberate presentation of the writing or thinking of another as  the student’s own.  In written or oral work, a student may make fair use of quotations, ideas, images, etc., that appear in others’ work only if the student gives appropriate credit to the original authors, thinkers, owners or creators of that work.  This includes material found on the Internet and in electronic databases.  Cheating entails the use of unauthorized or prohibited aids in accomplishing assigned academic tasks.  Obtaining unauthorized help on examinations, using prohibited notes on closed-note examinations, and depending on others for the writing of essays or the creation of other assigned work are all forms of cheating.  Academic dishonesty may also include other acts intended to misrepresent authorship of academic work or to undermine the integrity of the classroom or of grades assigned for academic work.  Deliberate acts threatening the integrity of library materials or the smooth operation of laboratories are among possible acts of academic dishonesty.

 

Sanctions for Violations of Academic Integrity

 

If an instructor determines that a student has violated the academic integrity policy, the instructor may choose to impose a sanction, ranging from refusal to accept a work product to a grade of “F” for the assignment to a grade of “F” for the course.  When a sanction has been imposed, the instructor will inform the student in writing.  The instructor must also inform the student that she/he has the right to appeal this sanction, and refer the student to the Academic Appeals Process described in the Bulletin of the Rosary College Arts and Sciences.  The instructor will send a copy of this letter to the Dean of the Rosary College of Arts and Sciences.  The Dean will note whether a student has committed multiple violations of the academic integrity policy over time, and in such cases the Dean may institute a process leading to possible further sanctions, including suspension or expulsion from the university.  This process is as follows:  The Dean will convene the Arts and Sciences student members and the Arts and Sciences faculty members of the University’s Student-Faculty/Staff Judicial Board, and present to the group a recommendation for warning/reprimand, suspension or expulsion.  This group will review the Dean’s recommendation at a hearing to which the student is invited.  The group will follow the process outlined in the “Student-Faculty/Staff Judicial Board” section of the current Student Handbook, with the following exceptions: (1)  The Dean of the Rosary College of Arts and Sciences will convene the group, not the Dean of Students.  (2)  The group will consist of the Arts and Sciences student and faculty members, not the full Student-Faculty/Staff Judicial Board.  (3)  The possible sanctions include only Warning/Reprimand, Suspension and Expulsion.

 

Academic Appeals Process

 

Any disagreement with regard to academic procedure, including individual cases of alleged violation of academic integrity and final grades, should first be taken up with the instructor.  If this does not settle the matter satisfactorily, the matter should be taken up with the departmental chair.  If the issue cannot be resolved at the departmental level, it should then be presented to the Dean of the Rosary College of Arts and Sciences. If the issue is still not resolved, the student has the right to present the issue to the Educational Policies Committee of the Arts and Sciences Council.  To do this, the student must provide a written statement of the issue involved to the Dean, who will then place it on the agenda for the Educational Policies Committee.  The committee will request a written response from the instructor and may, at its discretion, seek further oral or written clarifications from the student and/or the instructor.  The committee will evaluate the student’s appeal and vote to approve or deny it.  If the committee denies the student’s appeal, the original grade will stand.  If the committee approves the student’s appeal, the committee will determine the appropriate grade and submit a change of grade form to the Dean.  In the event of a successful appeal of an alleged violation of academic integrity, the original letter of notification from the instructor will be expunged from the Dean’s file.

 

 

Date   Topic                                                                         Assignment

8/29    Course Introduction and Syllabus Review 

 

8/31    Intro to Federal Taxation                                          Read Chapter 1

 

9/05    An Introduction to Tax Research                             Read Chapter 2

 

9/07    Individual Taxation – An Overview              Read Chapter 3

 

                                                                                                Handout 1; Chapter 3

                                                                                                Problems: 33,35,41,43,44

                                                                                                45,47,50,54

 

                                                                                               

 

9/12    Gross Income                                                            Read Chapter 4;

                                                                                                Problems: 21, 24,25,27,28

9/14                                                                                        29,31,32,33,38,40,41,

                                                                                                43,46,47,48,50

                                                                                                Handout 2

 

9/19    Gross Income – Exclusions                         Read Chapter 5;

                                                                                                Problems: 20, 22, 23,

9/21                                                                                        35-40, 48

                                                                                                Handout 3

 

                                   

9/26    Deductions:  General Concepts                              Read Chapter 6;

                                                                                                Problems 29, 34,35,41,42,

                                                                                                46,50,53

                                                                                                Handout 4

9/28                                                                                                                                       

 

                                                                                                                                                                                                                                                                                   

10/03  Deductions:  Business/Investment/PALs               Read Chapter 7

                                                                                                Problems: 32,33,34,39,40,

                                                                                                41,45,46,48,49,51,52,53

10/05                                                                                      Handout 5

 

 

 

10/10  Deductions:  Itemized Deductions                          Read Chapter 8

Problems:  24,25,26,28,29

                                                                                                30,33,34,35,37,40,45,46,

                                                                                                51, Handout 6

 

10/12

 

 

10/17  Examination One

 

10/19  Tax Credits, Prepayments and AMT                      Read Chapter 9

                                                                                                Problems:  42,43,45,47,48

                                                                                                54,58, Handout 7

10/24

 

 

10/26  Property Transactions                                              Read Chapter 10

                                                                                                Problems: 21,23,26,27,

                                                                                                28,29,30,31,39,40,42

                                                                                                Handout 8

10/31

 

 

11/02  Property Transactions: Nonrecognition                  Read Chapter 11

                                                                                                Problems:  21,22,28,32,39

                                                                                                41, Handout 8

 

11/07

 

 

11/09  Property Transactions: Capital and 1231              Read Chapter 12

                                                                                                Problems: 30,33,34,38,39,

                                                                                                40,42,44,49,50,54,55

                                                                                                Handout 9

 

11/14

 

11/16  Tax Accounting                                                          Read Chapter 13

                                                                                                Problems: 30,31,33,37,38,

                                                                                                43,46,49,50,51,56

                                                                                                Handout 10   

11/21

 

 

 

11/28  Deferred Comp and Education Savings Plans     Read Chapter 14

                                                                                                Problems:  32,35,43,44,51

                                                                                                52,62, Handout 11

11/30

 

 

12/05 Examination Two                                                                                                                 

12/07  Tax Return Project/Interviewing Skills/On the Job Discussion