TAX 700 Final Project I Milestone Two Guidelines and Rubric Appealing the Adjustment Overview: For the first milestone of your Final Project I NOPA Response Plan, you provided your client with a brief explanation of their current situation, using details from the scenario and the final project NOPA document. For Milestone Two, due in Module Four, you will complete the research necessary to make an informed recommendation on whether to appeal the IRS adjustment, and you will complete this critical component of your NOPA Response Plan. Several factors will influence your recommendation, including whether the relevant laws and regulations support the decision to appeal, and the materiality of the case to the client. Be sure to thoroughly address all relevant information when formulating your recommendation, including tax regulations and information from the NOPA and scenario, as you will need to provide a detailed explanation of how the relevant factors lead to your recommendation. Scenario: Imagine that you are a CPA working for an accounting firm. Your client is a Fortune 500 public company that has revenues exceeding $10 billion. It is a fast-growing company that has engaged your firm to handle all tax compliance and consulting. The client has recently received notification from the IRS, and they have determined that they will be under audit for the prior tax year. The client contacts you to help them through this process. While meeting with the IRS to understand what they need for their audit, you provided the IRS with your client’s trial balances, recent tax return work papers, and the tax returns themselves. After further review of those documents, the IRS provided your client with a Notice of Proposed Adjustment (NOPA) related to per diem expenses that the client has been providing to their employees when they travel for business. The per diems were for the combined lodging and meal expenses. The IRS is recommending that these per diems are nondeductible at a rate of 50 percent. The adjustment they have proposed is $5 million. While discussing the issue with your client, you learn that they have accounted for per diem expenses the same way for the past several years in their tax returns. You estimate that the fees associated with your services will be $250,000. This fee includes defending your client before the IRS, drafting a response plan, preparing a NOPA response, and defending your client through an appeal. Prompt: In this section, you will explain to your client why appealing the IRS’s proposed adjustment is an appropriate course of action by discussing all the relevant factors that your client should consider. Tax Rules and Regulations: Determine the taxation laws, revenue rulings, and/or revenue procedures that apply in this scenario, and explain how they impact your client’s current situation. Appeal Support: Explain which of the tax rules and/or regulations discussed above may work in yo ...