Background: In this assignment, you will read and evaluate two court decisions that conflict on
the issue of whether, for federal income tax purposes, two married people, each of whom would
individually qualify for a first time homebuyer federal income tax credit, should be eligible for
the credit if they file a joint tax return and do not qualify as a couple.
For purposes of this assignment you work under the assumption that no single “right” answer to
this issue exists. However, after reading and thinking about the two court decisions in this
exercise, you are going to take one position or the other (the couple should be eligible for the
credit on their joint tax return or the couple should not be eligible for the credit on their joint tax
return) and express that position, cogently, in a memorandum report.
By completing this assignment, you should gain experience some of the critical thinking subject
areas we have studied in class, including:

  1. Analysis (the ability to break a larger concept into its component parts and understand the
    whole by examining the kind of component parts it contains and the relation among those
  2. Evaluation (the ability to assess the relative worth of assertions and arguments);
  3. Inference (the ability to draw reasonable conclusions from antecedent information);
  4. Interpretation (the ability to understand and explain the meaning and/or significance of
    varied data, events, rules, etc.).
    Additionally, you will continue to practice some of the communication skills we have already
    addressed, including:
  5. Composing, reviewing, revising, and editing a written document; and
  6. Conveying financial information.
    Giving and Receiving Help: For this assignment, you should neither give to nor receive help
    from others (save from your instructor). The assignment is designed to give each class member
    individual practice with critical thinking and writing. Please note, additionally, that, as
    explained in the “Assignment: section, this is a “closed library” assignment which means
    that you are to read only the two cases provided
    Grading: This assignment is worth twelve points. A listing and an explanation of the grading
    criteria for this assignment appear on page 5.
    Business A303: COMMUNICATION FOR ACCOUNTANTS—Spring Term 2019
    Critical Thinking Writing Assignment—12 points
    Factual Background
    To help taxpayers afford to get into the housing market, the federal tax law provides a
    “first-time homebuyer tax credit” to any individual (for a person filing taxes individually) or
    married couple (for people filing taxes jointly) if the “individual (and if married, such
    individual’s spouse) had no present ownership interest in a principal residence during the 3-year
    period ending on the date of the purchase of the principal residence.”
    Congress enacted this tax credit through The Worker, Homeownership, and Business
    Assistance Act of 2009.
    The tax law also provides an exception allowing people who have owned and lived in a
    residence for a long time the same first-time homebuyer tax credit when “an individual (and, if
    married, such individual’s spouse) . . . has owned and used the same residence as such
    individual’s principal residence for any 5-consecutive-year period during the 8-year period
    ending on the date of the purchase of a subsequent principal residence.
    Although how people qualify for the first-time homebuyer tax credit may seem clear, an
    issue arises in the case of a married couple where one person qualifies for the credit under the
    “first-time buyer” general rule and one person qualifies for the credit under “long-term resident
    exception” because both of these exceptions seem to say that if a person is married, his/her
    spouse has to qualify for the credit in the same way he/she does.
    Within approximately the last few years, a pair of federal courts have reached opposite
    conclusions about whether the credit can be claimed by a married couple where one party
    qualifies under the general rule and one qualifies under the exception.
    Your general mission is to review and analyze the written decisions of those two courts,
    which court’s position is the better position, and write a memorandum report explaining and
    defending your conclusion.
    The court decisions are in separate, pdf format, files in the materials for this assignment.
    One decision was issued by the U.S. Tax Court; the other by the U.S. Court of Appeals for the
    Eleventh Circuit. From a purely legal standpoint, the second decision reversed the first, but, for
    purposes of this assignment (which I will discuss more fully in class) you are to disregard the
    fact that the Eleventh Circuit appeals court is a superior court to the federal tax court. Your
    mission is to compare the two decisions (their logic and reasoning in particular) and determine
    which made the better decision.
    While you will want to read both in their entirety, the part of each you will focus on is the
    analytical part at the end (the “Discussion” sections (starting on page 3 of the tax court decision
    and on page 5 of the appeals court decision). The parts of these documents appearing before
    Business A303: COMMUNICATION FOR ACCOUNTANTS—Spring Term 2019
    Critical Thinking Writing Assignment—12 points
    these analytical sections is primarily background historical and factual information that will help
    you understand what kind of facts and evidence the courts had before them. You will need to
    know about these facts in order to understand each court’s decision and rationale, but it is the
    rationale/decision of each court you are concentrating on, not the history or facts.
    The Assignment:
    ? Read and interpret the pair of court decisions, paying particular attention to the analytical
    section in the latter stages of each (the “Discussion” sections).
    ? Evaluate the relative merit(s) of the position taken in each decision. You may select your
    own criteria for evaluation. (For example: How fair or equitable the position is; how
    realistic the position is, given how businesses need to plan and operate; or how true the
    position is with respect to the language of the tax code and Code of Federal Regulations
    (as cited in the decisions).
    ? Although you are not required to use this framework, you may, if you like, look at the
    matter you analyze as:
    o A proposition of fact (e.g., “Court A interpreted the plain language of US tax
    regulations better than did Court B.” or “Court A did a better job of determining
    when a married couple is a first-time homebuyer under the tax law.”)
    o A proposition of value (e.g. “A tax system is clear and easy to apply is better than
    a tax system with a tax system with many hard to apply conditions and
    o A proposition of policy (e.g. “US citizens should pay their fair share of US
    income taxes.”)
    ? This assignment is a “closed library” assignment, which means that, in terms of source
    material for the assignment, you are to limit yourself to the two court decisions provided.
    You are not to conduct any additional library, internet, or other research—both because
    this is an assignment for a one credit hour course where you should not be called upon to
    spend long periods of time researching and because the primary teaching purpose of the
    assignment is to have your critically evaluate the pair of cases provided.
    After the end of the memo report described below, you should include the following
    signed statement:
    “I have neither given nor received unauthorized aid on this assignment.”
    Business A303: COMMUNICATION FOR ACCOUNTANTS—Spring Term 2019
    Critical Thinking Writing Assignment—12 points
    followed either by your signature or the typed electronic signature “/s/ [Your Name]” if
    you submit the report by e-mail.
    ? Write a memo report to me (your A303 instructor) explaining which of the two positions
    regarding the Packard family’s first-time homebuyer tax credit is superior.
    ? Even though you are writing to an academic instructor, follow the principles of effective
    business writing we have studied. You will benefit more, from a long run career
    standpoint, from writing to me like a practitioner than you will from writing to me like a
    student or academician.
    ? Your final report should be two to three pages long. (Aim for two pages, but if you need
    to run to three, you may: “I have made this letter longer than usual, because I lack the
    time to make it short.” Blaise Pascal (1660) Provincial Letters (No. 16)).
    ? So that I will be reviewing a reasonably similar amount of writing from each class writer:
    a report “page” is an 8½ by 11 surface, substantially filled with text. A piece of paper
    containing minimal text does not quite qualify.

Sample Solution