Syllabus

Federal Income Tax

 


Outline of the Course


I hope to cover the following topics during the course of the semester:  (i) introduction (chapter 1), (ii) income (chapters 2-3), (iii) business deductions (chapters 4-5), (iv) timing (chapter 6), (v) capital gains (chapter 7), (vi) nonrecognition transactions (chapter 12), (vii) mixed personal and business/investment deductions (chapter 8), (viii) who is the taxpayer (chapter 9), and (ix) personal deductions and credits (chapter 10).  Material may be added or deleted as the semester progresses.


Syllabus Updates


I will add specific reading assignments to this syllabus approximately every two weeks.  Typically, I post all of the slides that I plan to use in class during the following two weeks at the same time that I post the reading assignment for that period. In this way, you can (if you choose) print out the slides and bring them to class with you (whether to write notes directly on the printouts or to save you from having to copy down the material from the slides into your notes during class). For pedagogical reasons, however, I sometimes hold certain slides back (e.g., the slides that include answers to assigned problems). I post these slides the next time I update the syllabus after we have covered them in class.


Podcasting


I podcast all of my classes (barring, of course, the unforeseen technical difficulties that do sometimes arise). You can access the class recordings on iTunesU. To access the recordings, you must first log onto the Law School’s extranet and then click on the iTunesU link that you find there. Once connected to iTunesU, you should see a link with my name. Click on that link, and then click on the link for “Federal Income Tax.” I normally upload each class within one to two days. All recordings are listed by the date of the class meeting.


Naturally, the podcasts are in no way meant to be a replacement for attending class (see “Attendance Policy” on the “Welcome” page), but are intended as a resource for those who wish to review a class discussion and for those who missed a class (again, see “Attendance Policy” on the “Welcome” page).


Class Cancellations (UPDATED!!!)


I will be teaching this course on an accelerated basis. Our last regular class meeting will be on Wednesday, November 11, 2009, a week earlier than originally anticipated. As a result, we will need to make up three additional class sessions. I have scheduled these make-up sessions for 3:30-4:45 p.m. in Room 107 on the following Thursdays: Oct. 22, Oct. 29, and Nov. 12 (the day after our last regular class session). 


No make-up time is ever convenient for everyone. If you have a conflict that prevents you from attending a make-up session, you can listen to the podcast of the session (see above) and then come to visit me in my office, talk to me after class, or send me an e-mail to discuss any questions that you have regarding the material covered during that session.


A Few Words of Advice


Federal income tax is a challenging subject for all of us---that is, it is a subject that is both challenging to learn and challenging to teach. Studying federal income tax requires significant effort on both of our parts to ensure that you come away from the course having mastered the material covered.


It is imperative that all students come to class thoroughly prepared to discuss the assigned material. This means not only reading the cases and other material assigned in the Casebook, but also reading the associated sections in the Internal Revenue Code and Treasury Regulations (which the author of your Casebook is kind enough to list at the beginning of each section of the reading). After a first year of law school filled largely with the study of judicial opinions, this will be a new experience for many of you. Yet, tax is fundamentally a statutory subject and there is no substitute for reading the Code and Regulations, however difficult or boring they might seem to you.


Indeed, I expect you to have your statutory supplement with you at every class meeting because I will often ask you what a particular Code provision or Regulation section states. When I ask such a question, I do not wish to see you turning to your Casebook for the answer, but to the Code and Regulations in your statutory supplement. If, for some reason, an assigned Code or Regulation section does not appear in your statutory supplement, that is not an excuse not to read it. Instead, it is a reason for you to retrieve it from Lexis, Westlaw, CCH Tax Research Network, or from a hard copy source in the library.


I would also strongly advise you to review your notes and work on your outlines each week as the semester progresses (starting with the first week!). In that way, you can quickly identify any questions that you have or areas of difficulty that you are experiencing. I would then encourage you to promptly come to visit me in my office, talk to me after class, or send me an e-mail so that I can work with you to clear up these questions and difficulties. It is much easier to deal with the inevitable questions and difficulties that all students experience in studying tax as they surface during the semester rather than waiting until shortly before the final exam when a large number of small issues can grow to seem absolutely overwhelming.


AGAIN:

ALWAYS BE SURE TO READ THE CODE AND REGULATIONS SECTIONS ASSIGNED IN THE CASEBOOK AND BE SURE TO BRING YOUR STATUTORY SUPPLEMENT TO EVERY CLASS MEETING!!!!!!!


Introduction  (Slides)


Aug. 24, 2009


  1. Casebook, pp. 1-26


  3. Federal Income Tax Computation


  5. Effective Tax Rate v. Marginal Tax Rate Problems (please print out and bring these problems to class; they will be worked on in class)


  1. Optional tax policy reading: Read ch. 3 and pp. 162-69 of Critical Tax Theory: An Introduction (on reserve in the library)



Income (Slides)


Aug. 25, 2009

  1. Casebook, pp. 27-36

  2. Exercise in Statutory Reading (to be prepared in advance of class)


Aug. 26 & 31, 2009

  1. Casebook, pp. 36-44

  2. Prepare answers to the problems on p. 38

  3. Exercise in Statutory Reading (to be prepared in advance of class)


Sept. 1-2, 2009 (regular class sessions)

  1. Casebook, pp. 45-55

  2. Please read all of § 108 (this is a supplement to the sections assigned on p. 42 of the Casebook)

  3. Zarin v. Commissioner (Tax Court opinion)


Sept. 2, 2009 (make-up class)

  1. Casebook, pp. 55-64


Sept. 7 (no class, Labor Day)


Sept. 8-9, 2009

  1. Casebook, pp. 64-79

  2. Prepare answers to problems on pp. 78-79


Income: Exclusions (Slides)


Sept. 14-15, 2009

  1. Casebook, pp. 80-98

  2. Optional tax policy reading: Read pp. 116-24 and 185-99 of Critical Tax Theory: An Introduction (on reserve in the library)


Sept. 15, 2009

  1. Casebook, pp. 98-99

  2. Exercise in Statutory Reading (to be prepared in advance of class)

  3. Prepare answers to the problems on pp. 98-99


Sept. 16, 2009 (regular and make-up class sessions)

  1. Casebook, pp. 99-108

  2. Prepare answers to the problems on pp. 102 and 107


Sept. 21-22, 2009

  1. Casebook, pp. 108-28

  2. Prepare answers to problems 1-5 and 14 on pp. 121-22. After answering problem 4, consider this variation on the facts: What if Mike’s spouse were Mark and the two were residents of Iowa who were married there after the effective date of the Iowa Supreme Court’s decision extending the right to marry to same-sex couples? See 1 U.S.C. § 7.

  3. Prepare answers to the § 119 problems


Sept. 22-23, 2009

  1. Casebook, pp. 129-44

  2. Proposed amendments to Treas. Reg. § 1.104-1

  3. Prepare answers to problems 1-3 on pp. 142-43

  4. (continue reading below; the assignment for this class also contains material from the next chapter)

  5. Optional tax policy reading: Read pp. 155-61 of Critical Tax Theory: An Introduction (on reserve in the library)



Business Deductions: Basic Principles (Slides)


Sept. 23 & 28, 2009

  1. Casebook, pp. 145-59


Sept. 28-29, 2009

  1. Casebook, pp. 159-87


Sept. 29-30 (regular session), 2009

  1. Casebook, pp. 187-95

  2. Patton v. Comm’r

  3. Menard, Inc. v. Comm’r



Business Deductions: Capital Recovery and Depreciation (Slides)


Sept. 30, 2009 (make-up session)

  1. Casebook, pp. 196-219


Oct. 5-6, 2009

  1. Casebook, pp. 220-34


Oct. 7 & 12, 2009

  1. Casebook, pp. 234-35 (do not prepare an answer to the problem on p. 235; we will be doing problems in class)



Optional Tax Policy Reading: Read ch. 4 of Critical Tax Theory: An Introduction (on reserve in the library)



Timing  (Slides)


Oct. 13, 2009

  1. Casebook, pp. 255-64

  2. Prepare answers to the problems on pp. 256-57 and the problem in part (a) on p. 264


Oct. 14 (regular and make-up sessions) & 19, 2009

  1. Casebook, pp. 265-77

  2. Bring the tax benefit rule problem to class


Oct. 19, 2009

  1. Casebook, pp. 281-92

  2. Read Rev. Proc. 2004-34 on pp. 991-97 of the Internal Revenue Bulletin

  3. Treas. Reg. § 1.451-5(a) and (b)(1)-(2)


Oct. 20, 2009

  1. Casebook, pp. 293-300

  2. (continue reading below because the assignment for this date continues into the next chapter)



Capital Gains (Slides)


Oct. 20, 2009

  1. Casebook, pp. 301-07


Oct. 21, 2009

  1. Casebook, pp. 307-18

  2. Prepare answer to the gain problem on pp. 307-08


Oct. 22 (make-up session), 2009

  1. Casebook, pp. 318-35


Oct. 26, 2009

  1. Casebook, pp. 335-43

  2. Prepare answer to the problem on p. 339


Optional Tax Policy Reading: Read pp. 28-37 of Critical Tax Theory: An Introduction (on reserve in the library)


Nonrecognition Transactions (Slides)


Oct. 27-28, 2009

  1. Casebook, pp. 608-16, 629-33 (do not do any of the problems in the book)

  2. Cottage Savings Assoc. v. Comm’r

  3. Rev. Rul. 57-469

  4. Rev. Rul. 79-143

  5. Rev. Rul. 82-166

  6. Prepare answers to the § 1031 problems



Mixed Personal and Business/Investment Deductions (Slides)


Oct. 29, 2009

  1. Casebook, pp. 344-68

  2. Prepare answers to problems 1-6 on pp. 367-68


Nov. 2, 2009

  1. Casebook, pp. 383-89, 401-08

  2. Prepare answers to problems 1, 3, 3(a), 4, and 5 on pp. 388-89


Nov. 3, 2009

  1. Casebook, pp. 408, 414-32


Nov. 4 & 9, 2009

  1. Casebook, pp. 399-400 (the section on interest on educational loans), 432-36 & 440-45

  2. Yaeger v. Comm’r

  3. Read §§ 129 and 163(d) in Statutory Supplement

  4. Please note that the regulations under § 21 have been renumbered. They are no longer numbered Treas. Reg. § 1.44A-1, -2, etc., but rather are number Treas. Reg. § 1.21-1, -2, etc. Please skim Treas. Reg. § 1.21-1 and read Treas. Reg. § 1.21-2.



Who Is the Taxpayer? (Slides)


Nov. 10, 2009

  1. Casebook, pp. 469-86


Nov. 11, 2009

  1. Casebook, pp. 506-16

  2. Prepare answers to problems 1 and 2 on pp. 515-16

  3. Prepare answers to the alimony frontloading problems


Optional Tax Policy Reading: Read pp. 215-20 and ch. 8 of Critical Tax Theory: An Introduction (on reserve in the library)



Personal Deductions and Credits (Slides)


Nov. 12, 2009 (make-up class)

  1. Casebook, pp. 526-34

  2. Read §§ 67 and 68 in your Statutory Supplement


Optional Tax Policy Reading: Read pp. 276-89, 300-15, and 334-40 of Critical Tax Theory: An Introduction (on reserve in the library)



Review Session

  1. Dec. 5, 2009

  2. From 2-4 p.m. in Room 107


Sample Exam