There is often a significant amount of gray area when interpreting tax regulatio

Question

There is often a significant amount of gray area when interpreting tax regulations. There are several resources that are available to assist tax preparers in addressing these issues, such as the AICPA's "Statements on Standards for Tax Services." If you were asked by a client to include an unsubstantiated amount as a deduction, how would you address the situation? The deduction will make a significant impact on the client's tax liability. Would you address the situation differently if your manager insisted that you include the amount?

Explanation / Answer

First of all as a professional person we will analyze the situation and we will actually see whether as per law this deduction is allowable or not. If this deductions is allowable as per law then definitely we will take this into consideration which will enable our client to save the tax liability. But however if deduction is not allowable as per law then we need to see different pros and cons of the same and need to discuss the same with client as well as with my manager. However if my client is insisting me for the same then as a professional competence I will not allow this even my own manager insist for the same. In this situation I will go and present this case to my higher management as this is against professional code of conduct.

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