Competencies
In this project, you will demonstrate your mastery of the following competencies:
- Analyze the fiscal impact of tax laws and incentives on an organization
- Recommend optimal tax planning strategies that improve future tax consequences
Scenario
You are a tax associate with a large tax accounting firm and are compiling a comprehensive report about a new outreach initiative for SageGreen Computer Corporation. SageGreen has hired your accounting firm to assist in deciding and implementing a new energy- and environment-friendly initiative to add to the company next fiscal year. Your manager has tasked you with choosing SageGreen’s new project, compiling a research report, and providing future tax suggestions.
This project will help you understand tax laws and how to communicate with potential clients. You will need to conduct outside research using scholarly sources about this potential business venture and communicate your findings and recommendations.
Directions
Complete an inter-office memo showing current data and research relating to the most recent Form 1120 filed for SageGreen, which was accomplished in Project One. Also, complete a client-facing letter recommending future tax strategies to help SageGreen with the new energy-friendly project that you have chosen.
Part One: Memo
Write an analysis of the impact of tax laws and incentives as demonstrated in this current year’s tax return.
Specifically, you must address the following:
- Explain the relevant tax laws and regulations for the client company.
- Determine the tax and financial impact on the organization of relevant tax laws.
- Explain the advantages and rationale of the client company conducting a thorough cost-benefit analysis. Consider the following in your response:
- Difference between revenue earned and costs saved
- Impact of estimated costs and benefits
- Goal of the tax liability reduction
- Describe the ethical considerations of a tax preparer. Reference Circular 230 to support your argument.
Part Two: Client Letter
Write a reflection to the client that discusses the tax recommendations and consequences of your newly chosen energy-friendly initiative.
Specifically, you must address the following:
- Identify the tax effects of various options that the client may choose in the next fiscal year. Consider the following in your response:
- Tax laws, regulations, and codes
- Varying business strategies
- Options for tax-planning software
- Evaluate different tax planning strategies to help the company’s future financial goals.
- Discuss why calculations of financial projections impact the client’s future goals.
- Determine appropriate incentives to reduce the organization’s future tax liability. Include the following in your response:
- Future of the company’s new initiative
- Potential tax credits
- Recommend an optimal improvement to the company’s future financial goals.
What to Submit
To complete this project, you must submit the following:
Memo Your submission should be a 3- to 5-page Word document with 12-point Times New Roman font, double spacing, and one-inch margins. Sources should be cited according to APA style.
Client Letter Your submission should be a 3- to 5-page Word document with 12-point Times New Roman font, double spacing, and one-inch margins. Sources should be cited according to APA style.
Supporting Materials
The following resource supports your work on the project:
Resource: SageGreen Financial Information This Excel spreadsheet includes the financial information of SageGreen Computer Corporation, which you have already used to prepare and fill out tax Form 1120.
Project Two Rubric
| Criteria | Exemplary (100%) | Proficient (90%) | Needs Improvement (70%) | Not Evident (0%) | Value |
|---|---|---|---|---|---|
| Part One: Relevant Tax Laws and Regulations | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Explains the tax laws and regulations relevant to the company | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to the tax laws and regulations relevant to the company | Does not attempt criterion | 10 |
| Part One: Impact on the Organization | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Determines the tax and financial impact on the organization of relevant tax laws | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to the financial impact on the organization of relevant tax laws | Does not attempt criterion | 10 |
| Part One: Cost-Benefit Analysis | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Explains the advantages and rationale of the company conducting a thorough cost-benefit analysis | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to the goal of completing a cost–benefit analysis for the company | Does not attempt criterion | 10 |
| Part One: Ethical Considerations | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Describes the ethical considerations of a tax preparer | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to more references and explanations about the ethical considerations of a tax preparer | Does not attempt criterion | 10 |
| Part Two: Tax Effects | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Identifies the tax effects of various options that the client may choose in the next fiscal year | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to the tax effects of various options that the client may choose in the next fiscal year | Does not attempt criterion | 10 |
| Part Two: Tax Planning Strategies | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Evaluates different tax planning strategies to help the company’s future financial goals | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to a clear rationale in evaluating different, future tax planning strategies | Does not attempt criterion | 10 |
| Part Two: Calculations of Financial Projections | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Discusses why calculations of financial projections impact the client’s future goals | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to more relevant discussion of why calculations of financial projections impact the client’s future goals | Does not attempt criterion | 10 |
| Part Two: Incentives | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Determines appropriate incentives to reduce the organization’s future tax liability | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to more direct connection to the appropriate incentives to reduce the organization’s future tax liability | Does not attempt criterion | 10 |
| Part Two: Recommend Improvements | Exceeds proficiency in an exceptionally clear, insightful, or sophisticated manner | Recommends an optimal improvement to the company’s future financial goals | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include adding details related to the recommended optimal improvement to the company’s future financial goals | Does not attempt criterion | 10 |
| Clear Communication | Exceeds proficiency with an intentional use of language that promotes a thorough understanding | Consistently and effectively communicates in an organized way to a specific audience | Shows progress toward proficiency, but communication is inconsistent or ineffective in a way that negatively impacts understanding | Shows no evidence of consistent, effective, or organized communication | 5 |
| Citations and Attributions | Uses citations for ideas requiring attribution, with few or no minor errors | Uses citations for ideas requiring attribution, with consistent minor errors | Uses citations for ideas requiring attribution, with major errors | Does not use citations for ideas requiring attribution | 5 |
| Total: | 100% |