Experiences with the model tax curriculum.

• Author: Dennis-Escoffier, Shirley

Traditionally, a college student's first tax course has stressed tax topics for individuals. The basic concepts of income, business deductions and property transactions are taught within the context of their effect on individuals. If students do not take a second tax course, they may be unable to relate these broad concepts to other entities. Even when a student takes a second tax course, the coverage of business taxation and tax planning may be insufficient to meet the needs of today's employers. To address this problem, the AICPA developed the ModelTax Curriculum (MTC), which places greater emphasis on business taxes and tax planning.

The breadth of topics encompassed in the MTC necessitates that teachers limit the depth of coverage. Instructors who traditionally covered all the rules and exceptions must decide what to eliminate to make room for the expansion of topics. Although the MTC suggests a specific number of classroom hours for each topic, these are just guidelines. If an instructor needs additional time (due to local requirements or students' needs), he can deviate from the time specified in the MTC. The MTC can be found on the AICPA Website at http://www.aicpa.org/members/ div/career/edu/introduc.htm.

Although many schools have already made the change to the MTC, faculty who have not yet made the transition have asked for guidance on what has worked for those who have. In response to this request, the experiences off our faculty who are now using the MTC approach are examined: two for the first tax course and two for the second tax course. Suggestions are then offered to those faculty who wish to start making a gradual transition toward the MTC.

First Tax Course at the University of Texas

At the University of Texas at Austin (UT-A), students planning to become accounting professionals usually enroll in one of two programs leading to a master in professional accounting (MPA) degree. In the Professional Program in Accounting (PPA), students receive their bachelors and masters degrees concurrently. They apply for this integrated program at the end of their sophomore year and admission to the program is selective. The other program (a stand-alone MPA) is designed for students who already have a bachelor's degree, but it need not be in accounting. Within either program, students have the opportunity to concentrate in one of several areas, including taxation.

The PPA requires that all students take an introductory tax course in their junior year. Over half of the students take the course the first semester of their junior year when they are enrolled in one other accounting course (either financial or managerial). All these students have completed sophomore-level introductory financial accounting and managerial accounting courses. The introductory tax course for PPAs has been a four-semester-credit-hour offering; beginning in fall 2001, it will become a three-hour course.

Students who are pursuing only a masters degree waive the introductory tax course (a three-hour course especially for MPA students) if they have completed an undergraduate tax course in the U.S. with a grade of B or higher. Thus, most students who enroll in this course are either international students or nonaccounting majors.

The approach for the introductory course was changed in fall 1999, placing more emphasis on business entities. The change was made because of a firm belief that, if students take only one tax course (as is the case with many students who do not pursue the tax concentration), they should have some basic understanding of the taxation of various business entities to enhance their abilities to serve their clients or their corporate employers. Even with a four-hour course (as has been the case for PPAs), all of the material from the MTC could not be included; a judgment call about the most important topics for the students had to be made. Exhibit 1 shows a comparison of the content of the UT-A introductory tax course with that of the MTC proposals for a one-semester introductory course.

Exhibit 1: Comparison of course content at UT-A with MTC Number of Proposed sessions hours at UT-A Introduction 2 1 Tax research 1 0 Accounting periods, methods 2 0 Income 4 2 Deductions and losses, including passive activity losses 5 4 Property transactions 6 5 C corporations 4 2 Partnerships 3 2 S corporations 3 1 Individuals 5 4 Fringe benefits, retirement plans 2 (*) Computation of tax 3 1(**) Professional responsibilities in tax practice 2 0 (*) Fringe benefits are covered in the sessions on individuals. (**) Includes business credits, AMT. Note: In the past, classes have met 1.75 hrs. (for undergraduates) or 1.25 hrs. (for graduates) per session. Additional class sessions have been devoted to the following issues: the first class day--an overview of the course and the subject matter, two exam days (plus a comprehensive final during the final exam period), two review days and one day for a speaker who discusses tax practice issues. A conscious decision was made not to cover tax research in the introductory course, leaving that material for a graduate-level tax research course (required for students in the tax concentration); a number of nontax students take this course as an elective. A portion of a session, however, is spent discussing the various authorities to which one turns for answers to tax questions and their relative hierarchy. As a result, the students can better understand footnotes in the text that cite various authorities. Discussion of professional responsibilities is integrated in various places in the course, including responses to students' questions. Although full class periods are not devoted to accounting periods and methods, certain period and method issues are discussed in...