March 26th, 2022 
ACT 611 Federal Taxation
Tax Research Assignment #3
Using the information from Chapter 7 and the tax research resources from Chapter 5 write a tax research memo for the firm’s records (TAX FILE MEMORANDUM). No client memo is necessary. Refer to pages 5-15 through 5-16 for a sample memo format. Use Checkpoint to find your primary sources and only cite primary sources. Some Internal Revenue Code (IRC) sections to consider include, but not limited to, the following: 162(a); 263(a); 1016(a)(2); 1012; 168; 168(k); 230F(a); 179(d)(1); 179(b)(2); 179(b)(3), etc.
When writing this research memo, you may have a number of research issues. Use the numbered items to develop your tax issues. List them separately (bullet points or numbered). Some of the bullet items are not research issues but information that should be incorporate and answered in your analysis. The law and analysis section should address each research issues in a separate paragraphs. Please do not embed your research into this document!
Chocolat, is a newly formed chocolate manufacturing company in Massachusetts. During the current year, the company acquired and placed several assets in service. The new facility design includes areas for candy making classes. A list of the year’s acquisition is outlined below.
Other: The company has taxable income for the year of $500,000.
Current Year Expenditures | Date Placed in Service | Amount |
Building (building $950k; land $2500k) | April 1 | $1,200,000 |
Manufacturing equipment for melting, mixing, and tempering chocolate | June 5 | 1,900,000 |
Build-out of interior area for show room and candy making lessons | October 10 | 250,000 |
Displays, molds, and fixtures for candy-making lessons | November 2 | 455,000 |
Office furniture | December 1 | 60,000 |
Delivery van (6,000 lbs.) | December 15 | 45,000 |
Total Cost | 3,910,000 |
Required:
Research the following to assist the company in maximizing tax savings for the year using the various allowed cost recovery methods. You will be required to (1) submit a research memo document and (2) an Excel template (provided) to calculate depreciation and support your analysis. Your analysis and your computations must be consistent between the written document and the Excel spreadsheet calculations.
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