Partnerships and Special Allocations with Professor Timothy Rupert

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In this webinar, we’ll hear from Professor Rupert as he explains the Online Master of Science in Taxation program at Northeastern University, the Partnerships and Special Allocations course, and how his courses operate.

Transcript

Angela LaGamba: Welcome to Northeastern University’s online Master of Science in Taxation webinar. My name is Angela and I’ll be your host and moderator for today. Before we begin I’d like to go through some logistics and commonly asked questions for our webinars. We do encourage you to send in your questions during today’s session. We will be addressing them throughout the webinar and also during our dedicated Q&A session. You can just place them into the Q&A box and hit enter. We also are recording today’s session so you can listen to it at a future time.

All right, let’s get started. Your presenters today are Professor Timothy Rupert and Michelle Yan. Timothy Rupert is a Professor of Accounting at Northeastern University’s D’Amore McKim School of Business. He completed his PhD in accounting and MS in taxation. Professor Rupert’s research includes cognitive and decision making processes of tax payers and tax practitioners. We also have Michelle Yan, she’s the team enrollment lead for Northeastern’s online Master of Science in Taxation, and her role is to help perspective students through the application and admissions process.

All right, let’s get started. We have our agenda for today. We’re going to be talking a little bit more about Northeastern and the online Master of Science and Taxation. We also have Professor Rupert who’s going to be covering Partnerships and Special Allocations. And then we’ll be providing more information on admission requirements, tuition and fees, and as I mentioned earlier, feel free to send in your questions as we do have a dedicated Q&A session at the end of this webinar.

All right, without further ado, I’d like to handle it over to Michelle to talk a little bit more about Northeastern University. Go ahead, Michelle.

Michelle Yan: Thanks very much, Angela. Could I get the next slide? Okay, perfect. So our online MS in Taxation program is part of the D’Amore McKim School of Business. It was established in 1922 and has a rich history and reputation for scholarly research and teaching excellence. Building on high academic achievement, wide range in work and consulting experiences, rich diversity, and our extensive corporate ties, the D’Amore McKim School of Business faculty members are leaders in their fields and regularly receive worldwide recognition and awards for their contribution to theory and the practice of management.

We do have over a – a global network of over 200,000 Northeastern alumni spanning more than 15 countries, including China, Canada, India, England, Germany, and Australia to name a few. Almost 90 percent of our students pursuing graduate business degrees have work experience, so our programs are very accommodating and flexible.

Now when it comes to accreditation and rankings, we are accredited by the AACSB International. This is one of the highest business accreditations worldwide. And most recently, Northeastern University online graduate business programs was also ranked number 18 in the US, 2016, by US News and World Report. This also does include the online Master of Science in Taxation as well.

Now a little bit regarding the program itself in terms of sort of some of the highlights and the structure of the program. The online MS in Taxation program was certainly designed with the working tax professional in mind. The course work is 100 percent online. There is no residency requirements, and the program can be completed in as little 16 to 18 months.

Typically there are ten courses and students are only required to take course one course at a time, and each of the courses are five weeks in length. So they are a little more accelerated program, so again, five weeks in length. But I find that most students who are coming into the program, that they really enjoy the schedule as many working tax professionals coming in, they have full-time positions, some of them even have their own practices, family, and they have kids, and taxes, as you know, can be very hectic. So the actual one course at a time actually works very well.

Now in this program we also do offer two specialty tracks if you do want to have a focus. There is a taxation of entities or a taxation of individuals. Students who would like to choose courses from both tracks, and if you’re a business, you work with both individuals as well as business clients. If you’re asking whether or not you can sort of mix and match between the two tracks, actually you can do that as well.

Now there are a variety of different tax professionals who are coming into this program. We do have students coming from a lot of public accounting firms, individuals coming from private industry, the IRS, the big four firms as well, of course. So it is certainly a fantastic opportunity to collaborate on cases, trade ideas perhaps, learn from each other and certainly develop strong networking opportunities as well.

Now most recently we conducted a survey in September 2016, so just about two months back, of Northeastern University online MS in Taxation graduates. These are some of the things that they had to say. And they mention that some of the top reasons that students attend Northeastern are certainly the online format and the accreditation. The online format we work with something called an asynchronous system and essentially there are no specific login times that students have to be online. So it’s simply a lot more convenient, a lot more flexible. Again, for students who do work full-time they have their practices and want to review certain things, course materials at their leisure.

Angela LaGamba: Great, thank you very much, Michelle, for walking us through Northeastern and also the online Master of Science in Taxation. What I’d like to do now is to hand it over to Professor Timothy Rupert who will talk a little bit more about partnerships and special allocations. Go ahead, Professor.

Timothy Rupert: Thanks, Angela, and welcome everyone to the webinar. As Angela mentioned, my name is Tim Rupert. I’m a professor in the program and I teach two of the courses that are part of the five required courses in our online program: the Partners and Partnerships course and the Corporations and Shareholders course. So I thought I’d give you a little bit of an idea of the types of things that we cover in one of those courses, the Partnerships course.

Just to give you a sense of where this falls in the curriculum, typically students will take these two courses, the Partnerships and the Corporations course, as part of their required courses. They usually take at least two courses before this, one on advanced individuals and one on research and practice and procedures, and then they move into these courses. So I wanted to give you a sense of what one of these courses is like and some of the information that we talk about. So today I thought I’d talk a little bit about partnerships and special allocations in thinking about a partnership as an entity choice.

In the two courses that I teach, the first lesson that we look at is comparison of the different entities. I know that a lot of you have a great deal of familiarity with the different possibilities and how they’re all treated, but it’s always good for us to start with that to get a baseline that we’re all working from, and also a little bit of a historical perspective on how we arrived at our current choice of entities .

So just to remind you of some of the key issues that are associated with partnerships, we know that there’s a single level of taxation versus, you know, when we’re dealing with corporations there’s double taxation in our system. So the earnings will be taxed to the corporation and then when it’s distributed to the shareholders, it’s going to be taxed again. So a huge benefit of a partnership or other types of flow through entities that are taxed as partnerships is the fact that we have that single level of taxation. We also know, you probably have this from previous experience to build a business can be a pretty difficult thing in terms of liquidity. So we know about those benefits.

Along with that then comes the fact that there’s a great flexibility in allocating items. If we think about forming a corporation and, let’s say, that you and I are going to become 50/50 shareholders. There is a lot of advantages to forming a corporation but one of the issues associated with it is that if we plan to do distributions, we have to do those on a pro rata basis. So if we’re going to distribute a dividend, I’m going to get 50 percent of it and you’re going to get 50 percent if we’re going to be 50/50 shareholders.

In a partnership we can be 50/50 partners but we have a great deal of flexibility in how we allocate specific items. So we might say that for allocating depreciation I’ll take 70 percent and you’ll take 30 percent of it. There are some rules that control that a little bit. Those allocations have to have substantial economic effect but in reality it gives us a great deal of flexibility.

One of the underlying themes that I have then in my partnerships course is that if we think about that great flexibility that it gives us and the fact that they’re single taxation, and when we’re thinking about formation that it’s nontaxable, it offers some opportunities and there would be opportunities for taxpayers to shift the amount or the character of income. So many of the rules that we look at in our course and the rules that we have that provide our framework on how partnerships will be taxed, are designed to stop us from shifting that amount or character of income. A good example of ____ shifting the amount of income and how that’s a possibility in the partnership setting and how we have some rules that are going to put some restrictions on that.

So this diagram that I have for you is a really simple formation problem. We have two partners. A is willing to transfer cash of $50,000 and they’re going to get a 50 percent interest in return. And B is going to transfer land and has a fair market value of 50, a basis of 30, and they’re going to get the other 50 percent interest. So a real simple partnership, but it will illustrate the examples that we want to show.

So as we’ve already discussed when you from a partnership it’s going to be a nontaxable transaction. So the partners in that example are not going to have to recognize typically any income or gain or loss, and the partnership will not either. So if we look at the partnership and focus on it, they’ll end up taking a carryover basis in that land. So for partner B that land had a basis of $30,000 and that will become the partnership’s basis in that land, right? So it’s a fairly straightforward implication and you’ve probably seen that before. But now let’s think about what happens as we move this partnership forward and what implications this nontaxable formation may have.

So let’s assume that it’s a couple of years later and our partnership decides to sell the land for $50,000, the fair market value it had when in went in. Let’s say that that fair market value didn’t change. Well, any time we sell an asset we know that we have a basic formula in tax that we use to calculate the gain or loss realized. And that’s the amount realized minus the adjusted basis. And you’ve all probably know, given your backgrounds, that’s basically what you sold it for minus what you purchased it for. We know that it’s more complex than that, but conceptually that’s really what we’re doing when we’re calculating the gain or loss realized.

So in this one the partnership sold it for $50,000. On the nontaxable formation their basis in that land was $30,000, so they’re going to have a $20,000 gain. But, as I’m sure you also know, a partnership is not a separate taxable entity. That’s what leads to that single level of taxation. Instead, they flow through all of the income expenses to the individual partners. So in this case we have this $20,000 gain, and we have to figure out how we’re going to allocate that to the two partners that we have, A and B, in our scenario.

So if we didn’t have any special rules, let’s think about how we would allocate it. As you see on this slide, if there aren’t any special rules, A and B are 50/50 partners. So we would split any income gain, losses, expenses typically that same way. So here for that $20,000 of gain, A would get $10,000 and B would also get $10,000. So let’s think about the implications of that and what that means for our partners. Well, if we didn’t have B transferring this property into the partnership, if they had sold it instead, they would have had to recognize all $20,000 of gain on that land because they had a basis of 30, it had a fair market value of 50. So if they didn’t transfer it in, if they just sold it instead, they would have to recognize all $20,000 of that gain.

If we look at the implications without any special rules, and again, I’ll jump back to that so that you see it, what we see is that they’re splitting that gain $10,000 each. So effectively what B’s been able to do with this is if we don’t have special rules, they’ve been able to transfer $10,000 of that gain from them to A.

Now that obviously is great for B and it means that they’re only going to be recognizing half of the gain that they would have, but you can see why they might even have motivation to do that, especially if we start to think about this as maybe A and B are not entirely independent parties. Maybe they’re family members and B is a parent and A is a child that’s in a lower income bracket.

Well, now if we can do that, we’ve basically cut this asset in the family through the partnership, and we’ve transferred gain from what may be taxed at, let’s say, the highest individual rate of 39.6 percent down to a much lower marginal tax rate potentially for a child, maybe they have the 10 or 15 percent bracket. So if we didn’t have special rules there would be a big opportunity here for us to shift income and here we’re talking about the amount of income to someone else.

So what do we do in these cases to stop that from happening? An important set of rules that we have for partnerships are those rules that are contained in section 704C. So it looks like some of you have some familiarity with partnerships, that you work with it occasionally, some frequently. So you may have come across section 704C before. Section 704 is a really important code section when we look at the code structure or framework for partnerships. But this one particularly, section 704C, deals with any building gains or losses that are transferred when we form that partnership.

So in this case what it tells us is that if there’s any building gain or loss, so like in our example with this land being transferred in, there was this $20,000 building gain that we’re going to have to firs allocate that gain to the contributing partner. Then if there’s any other gain after that, other parts of section 704 in A and B will tell us how we’re going to allocate it.

So instead of getting to shift this income from B to A, our results are going to look like this. Under section 704C, the way that we’re actually going to allocate it is A’s not going to get any of that gain, that $20,000 gain when the partnership sells it. And B will end up recognizing all $20,000 of it. So the end effect of this is that B just wasn’t able to shift the gain from them to A. So that’s an important, again, underlying issue with all of our partnership settings. That if we didn’t have some of these special rules there would be opportunities to shift this gain.

So what we’ve done today with this example is just sort of set up that basic issue so that you understand it. If we were actually going through our partnerships course, we would follow that up with more advanced issues about how there might be opportunities to shift that income and what our rules tell us that might stop it, and how we might plan for those cases.

So we looked at a simple example that dealt with gain. And it sounds like just from your backgrounds I kept this example really simple, the amount of gain equals exactly the amount that was built in, but you probably know, given that some of you have some familiarity with partnerships, that if the gain wasn’t exactly equal to the building gain that was transferred in, that we’d have some different issues that are involved.

Those are some of the things that we would be looking at in our Partners and Partnerships course. Obviously we won’t talk about those today, but it includes things like the allocation of depreciation because it’s not just then when we eventually sell the asset, but it will also impact how we treat that asset as we’re holding it. So I used land in our example so we didn’t have to worry about depreciation, but if we’re dealing with a depreciable asset, you can see that, yes, there would be opportunity to shift if we wait until the eventual sale, but we’d also have opportunities to shift just as we hold that asset and continue to depreciate it.

There’s another issue here call ceiling effects, and I’m guessing maybe unless you really work in this area, you may not have seen this as often. But ceiling effects deal with this issue where let’s say we don’t have enough gain or depreciation to allocate to the partners as they deserve. So what we do in those cases is we use these advanced methods, either allocating under the traditional method, the traditional method with ____ of allocations or the remedial method.

So, again, if we were working through this in our course, we’d be talking about how do those methods work, and why might we use one of those instead of others? Who gains, who loses out of it, what are the advantages and disadvantages of it and how do we plan around it? So that gives you an example of the shifting of income.

I want to look at another example to talk about the other possibility that we have when we’re using this non-taxable formation and it’s a single level of taxation. So the issue that we have there is dealing with shifting the character of income as being a possibility. Again, if we didn’t have special allocation rules, there would be opportunities for partners potentially to shift the character and so let’s take a look at a simple example of that.

So, again, I’m using land here because it avoids a lot of issues for us, right, and I saw somebody popped up the question that you can’t depreciate land. That’s why we used it in our first example. So that way we didn’t have to worry about special rules related to depreciation as they held the property because land they wouldn’t be depreciating, so they could sell it for several years later and we wouldn’t have to worry about their basis changing. So that’s why we used that simplified example. But in our course we would actually be looking at other types of assets to see how depreciation would work when it is an asset that would be depreciated.

Again, let’s use a simplified example here. We’ll use land again because we don’t have to worry about depreciation as we hold that asset, but in this case instead of saying that maybe for B it was land that was held for investment or maybe it was land that was used in business. So those types of lands would have different types of character if you know the rules related to character of income.

Let’s look at a similar example. This time we’ll call them C and D. C is transferring in cash with $50,000 to get a 50 percent interest in return. D is going to transfer in land, and let’s say that D is a dealer in real estate. So now this land might be inventory for them. And, again, this would apply with any inventory but I’m using land because it simplifies some things. Let’s again say fair market value is 50, the basis is 30, and they’re getting a 50 percent interest in return.

All right, so same basic example but we just changed the type of property that our second partner is transferring in. So let’s say that following this transfer into the partnership and the formation that that partnership uses the land but now they use it as the location for its operations. And we’ll follow with what we talked about with the first example. Let’s say a couple of years later the partnership decides to sell that land. And they sell it for $50,000. Again, we’ll keep it at fair market value, the same as the fair market value when it was transferred in because that’s going to make it a little bit easier for us to work with at that point.

All right, so let’s see and think about what would happen in this case. So we’d still have that gain of $20,000, right? So we have the $50,000 that the partnership is selling it for. We’re going to subtract the $30,000 that they have as their adjusted basis, and it ends up with a $20,000 gain. We know that because of section 704C, all $20,000 of that is going to be allocated to D. But you can see that this would create another issue and here it’s what type of gain would this be? So let’s think about that a little bit.

The rules here come based on how the partnership used the property. So if we didn’t have any special rules, then that $20,000 gain would depend on how the partnership used it. So, again, given that you all have, it looks like, some really good experience in partnerships and just in tax in general I’m assuming, then you should realize that if the Partnership used it in ___ or business. So we said that it was location for their operations, and they held it for several years, then that’s going to make it a section 1231 asset. That means that this would be a section 1231 gain. What you probably know then, is that when you have section 1231 gains, those at least have the potential to get preferential treatment. So if our partners are individual taxpayers, and we’re going to transfer out this gain to them, and it would be treated as 1231 gain, then instead of being taxed at the 9.6 percent, as gains on inventory might be, it could be taxed at a preferential rate.

So let’s again think about what the implication would be. So if they transferred this out without any special rules, this was allocated out to the partners, D is going to get all $20,000 based on section 704C that we saw before, but if they had sold it themselves it would have been ordinary income because it would have been a sale of inventory, and they probably would have paid their marginal tax rate on that, and let’s say that was 39.6 percent, but now they’ve converted that to $20,000 of section 1231 gain if we didn’t have any special rules. And so that would have the potential for that preferential treatment. It doesn’t guarantee that it’s going to get preferential treatment. You probably know the rules for section 1231 and how we determine whether it’s going to be taxed at a special rate or not, but it at least has the potential for it.

So, again, if we didn’t have special rules there would be really great planning opportunities here for passing property into a partnership and using it as a tool to convert the character of income. But we have a code section that’s going to put some breaks on that or not allow us to do that. So the section that we have is section 724B. That code section – so I’m not sure if you’re familiar with this code section, but section 724B actually deals with just inventory, but other parts of it, so section 724A deals with unrealized receivables, and section 724C deals with capital loss property. So it deals with all these different types of property that have special rules associated with them that if we didn’t have these rules, there’d be some advantage to re-characterizing income gain, loss, or expense that the partner transferred in.

In this case, the specific rule that we have – because if you are familiar with this code section, you know that each one of those items has different rules. For inventory, the rule is that if the property was contributed to the partnership within the last five years, and the partnership then sells it, the gain’s going to be ordinary regardless of how the property was used by the partnership.

So in this case, let’s think about what the actual implications will be then. B’s not going to get – or D’s not going to get this $20,000 of ordinary – or excuse me, of 1231 gain. Instead, it’s going to be recognized as $20,000 of ordinary income. So, this is an example of how it’s going to stop us not just from shifting the amount or character of income, but shifting the character as well.

So in part with our classes we talk a lot about tax planning and you probably know some of the key variables that we look at, and you should realize that shifting income to someone else is a key aspect of tax planning; if we can do it and it makes sense to shift it at a lower income level.

Also shifting character is a huge advantage, and we’re seeing that a little bit with the second example. We follow up in our course looking at how shifting of character may come into other scenarios. So when we’re dealing with a contribution of property we talk about the other sections – subsections of section 724, looking at issues related to receivables and capital loss property. But, again, if you have some familiarity with partnerships, you’ve probably realized that this comes up in other contexts as well. So it’s an underlying theme that we’ll see across a number of the modules that we do in this online course.

If the partnership’s distributing property – and this isn’t property that was contributed to it, but just property that it buys and then later distributes to the partners, that’s going to create some similar shifting of character issues. When a partner sells a partnership interest it has sort of that same type of issue where if we didn’t have some special rules, we would have opportunities for partners to shift character from something that’s paid maybe less advantageous to something that’s more advantageous.

So, again, what we’re going to do in our course is we take a look at what are those rules, how do they impact it, and how do they stop that shifting, and then what are ways we might plan for it? Are there ways that we can provide tax implications that are best possible for taxpayers that work within the rules but also then consider what are ways that it could be structured differently?

So, those couple of examples give you just an idea of one of the topics that we cover in the partnership course and how we address it. At this point I’ll turn it back over to Michelle, and she’ll talk a little bit more about the program.

Michelle Yan: Great, thanks very much, Professor Rupert. So when we’re looking at admission requirements, some of the things that we consider is that students need to have an undergraduate degree from an accredited institution of higher learning. We’re looking for about a 3.25 GPA on a 4.0 scale. Applicants also need to have either an undergraduate or graduate course in taxation with a 3.0 grade or above, and also a minimum of two years of professional tax experience, including one busy season or you need to hold the following credentials like JD CPA, CSP or enrolled agents.

When it comes to the application requirements in terms of what students need to put together in order to apply to the online Master of Science in Taxation program, first of all, we are looking for a current resume or CV. We are looking for two professional recommendations, and so these can come from your current employers, previous employers, colleagues, clients, and of course for individuals who have their own practices, they can surely get them from their clients. So essentially any individual that you feel can more so comment on your tax work experience or your tax work with them.

The third document we’re looking for is an application essay. There is $100 application fee involved as well. Also, we do require all official transcripts. So whether it be an undergraduate degree or graduate work ____ degree conferred by the accrediting institution. We often had questions regarding students who had completed their degrees outside of the US, their bachelor’s degree. So we certainly welcome serious students who have their actual transcripts, but they would need to be evaluated.

Finally, for candidates whose undergraduate instruction was not conducted in English, may need to submit a TOEFL. So if any individuals have any questions regarding that, they can certainly contact me as well.
When it comes to tuition, just a little bit of a breakdown. There is, as I mentioned before in terms of the application, there’s $100 application fee. The cost of the tuition is $1,513 per credit hour. There’s ten courses and then there are a total of 30 credit hours. The total tuition works out to be $45,390. Typically, I would allocate – anything on top of that total tuition sometimes students will ask what about books and course material. They’ll probably allocate another maybe on average $200 per course for the cost in books, again, times ten courses.

Northeastern University does offer a couple of scholarships and the first thing is with Yellow Ribbon program. Now, Northeastern has committed to supporting our veterans and the online program has recently become part of the Yellow Ribbon program. If you fall under this program, it then means that most or all of your tuition will be covered by the government and Northeastern University. For more information regarding this please do visit the website that is listed on that slide.

As part of our commitment to our alums, beginning Fall, this was in 2015 that the D’Amore McKim School of Business will also offer something called the Double Husky Scholarship for all Northeastern alums who have completed a previous degree at one of our colleges. What this does offer is a 25 percent discount on tuition for online and MS tax program. In addition, the $100 application fee will also be waived. And again, for more information regarding this particular scholarship, you can visit our website listed on the slide as well.

And finally, Northeastern does offer something called the Lifetime Learning Membership. It is available to families of currently enrolled full-time students. So if you have a child, a sister or brother, an immediate family member who’s currently enrolled in undergraduate full-time status at Northeastern undergraduate programs, family members are able to take advantage of a 25 percent discount on tuition. And, again, for more information regarding this you can visit the website that is listed below as well.

Angela LaGamba: All right, thank you very much, Michelle, for walking us through the admissions requirements and tuition and scholarship options that are available to students. What I’d like to do now is open the floor up for questions to our audience if you have any questions for either Michelle or the Professor, please feel free to send it in through the Q&A box. We will be addressing those now. So let’s get started with our first question. This question is for you, Professor, and it’s how can students prepare to be successful in the online program?

Timothy Rupert: Okay, great, thanks. I think that’s a great question. And actually knowing this webinar was coming up I had an online chat with my class on Tuesday night and asked them to provide a little bit of advice.

I guess some of the things to think about – one of the things is that our classes are accelerated and concentrated in the sense that they happen over a five week period. And there’s some great things about that. I think one of those is that rather than in our ground program – and I, again, teach the same partnerships and corporation’s courses there. That’s over a 14 or 15 week time period and you’re coming once a week and we go through it that way. This is concentrated so you’re getting through it in a quicker pace of time. Five weeks and you’re done with that topic. But we don’t change the amount of work that we do within those five works versus the 15 weeks.

So it is concentrated, it’s accelerated, and I think if you’re thinking about applying to the program you have to be aware of that. That you have the time available to commit to it. The students that I ask about – they said to be successful in the program it’s really important that you keep track on the material, keep up to date on it, meet the deadlines because with that concentrated time period you’re going to be done in five weeks, but there’s not time to fall behind.

With that said, I would think the students that – I’ll give you examples from the chat that I was on. We understand that everybody’s busy. You’ve got your practice, your professional life, you’ve got family, you’ve got a lot of things pulling on your time. One of the students on the chat Tuesday night just went back to work. She had been on maternity leave. She had two children because she had twin boys that are about five months old now. Had just started back to work as we were starting this class. She’s got a lot going on. But she said she’s been able to balance that all realizing though that it means sometimes that she’s going to be working a lot on the weekends to catch up with things and get the things in on time.

So just make sure that you have the time to commit to it. And to keep progressing with it because that five weeks goes by pretty quickly. So all of the students were saying you have to really have time that you’re going to be able to commit if you are working full-time and you have a family, you’re able to balance it. There’s some flexibility with things.

What we’ve done in terms of the way that I’ll tell you from my courses, we have deliverables every week. Those deliverable come at the end of the week, so it gives you time to fit it in to your schedule during the week. So most of them come due at the end of the night on Sunday. So you can catch up on the weekend if you don’t have time to get through everything throughout the week because it’s a busy time for you. So that’s probably the most important thing, to keep up with things, to commit to the time, and figure out where you’re going to fit it in order to work well with it.

Angela LaGamba: Great, thank you very much, Professor. The next question that we have from one of our audience members is around the degree for admission. So, Michelle, the question is does the three year degree of 90 credits from university qualify for admissions for the online Master of Science and Taxation? Go ahead, Michelle.

Michelle Yan: So if there are individuals that have completed a degree outside of the US, we would normally ask for a credential evaluation. So take that transcript from the university that you did go to, go through an evaluation process to ensure that that degree is equivalent to a four year bachelors in the US. Depending on that degree you can certainly reach out to myself because we do work with a couple of third party evaluation agencies that we usually recommend students can go to get that evaluation completed. So if you’re not sure whether or not the degree itself from the different country is sufficient for admission requirements, I highly recommend you reach out to myself and we can certainly speak with this individually and I can better be able to advise to which agency that we do recommend that you go to. And so we can find out, let’s say, if you were looking to apply to the Northeastern online MS in Tax program to ensure that you do meet the requirements first.

Angela LaGamba: Great, thank you very much, Michelle. The next question we had from our audience was will the slides be available as a PDF file? So to answer that we are recording this session, so you just reach out to Michelle and we can provide a recording to you as well including the slides.

Let’s see, the next question that we have is around tax season. So tax season is a busy time of year. So, Michelle, one of our audience members wanted to know is can working professionals take tax breaks during tax season in the US?

Michelle Yan: Yes. That’s actually a very good question that we do get. Obviously, students coming to the program – what happens during tax season when I’m working 70,80, 90 hours a week during that time? So typically the courses do run – like I mentioned, one course at a time, and Professor Rupert had mentioned that they are five weeks each as well.

Now, we’re fairly flexible. I mean, even though we say that this program – you can complete the program in a minimum span of 16 to 18 months, you have up to a maximum of five years to complete the program. Now what that really means is that during tax season if it is in the case between March and April deadlines or perhaps extension deadlines for September and October, things are very hectic and there’s just no way that tax practitioners are able to take course during that time, you can elect to take breaks during that time. And so throughout the year because the courses are only five weeks, if you’re taking a break between February to April or perhaps January to April, we certainly do accommodate, and then when we have cases where students take courses between May and then all the way to December. Has that been your experience as well, Professor Rupert?

Timothy Rupert: Yeah, I was just going to say that we do have classes that start early in January and it’s a five week period. So a lot of people will be able to sneak one in there before busy season gets really bad for them, if they’re on the traditional busy season. So they’ll take one then, but then a lot of students, again, if they’re on a traditional busy season won’t be taking anything during that mid-February or beginning of February through April time period.

It’s a similar type thing with the extension season when you get to September and October. For some people that’s perfect timing but for other people it’s just as crazy then, and so people will take a little break for a five week period, get through that, and then start back up again. So I think the way it works especially with our required courses, they’re offered multiple times during the year. So usually, again, most of us – most people in practice have a pretty similar type of busy season, but definitely I’ve had students who have had busy seasons that were off cycle from what the majority of tax profession has just because of the types of things that they’re working on. I think which ever you have, you’re able to work around it.

Also, it’s not even just busy seasons. Sometimes people have major events coming up in their life. I’ve had people that were having children and that would impact when they decided to take or I’ve had people that have had children getting married, for example. It was a big event and they know they’re going to need a lot of time and spend a lot of energy on that, and so I think this format that we have gives them flexibility to take some breaks, move out of it, and then jump back in and continue on.

Michelle Yan: Absolutely, and this also goes for – I’m glad you mentioned that, Professor. It also goes for individuals who want to take vacation. And that type of break. After tax season many tax professionals want to take two weeks off and just go away somewhere, which I can completely understand as well. So we do accommodate for those breaks and that’s why this program fits very well and keeps it very flexible as well.

Angela LaGamba: The next question that we have is for you, Michelle. They’re wondering what are the admissions requirements for the programs? I know, Michelle, you’ve gone through that but maybe can you outline what some of the more common elements or common questions that you get during the admissions process?

Michelle Yan: Yeah, sure, absolutely. So the admission requirements, I have them listed on the slides, once again. But essentially, as I mentioned, you typically do need an undergraduate degree. We’re looking for about a 3.25 GPA from an undergraduate level and a minimum of two years of professional tax experience.

Now if your case is something not necessarily exactly those requirements, if you don’t think you’ve met those requirements, definitely come speak with me because sometimes – I mean, we do judge based on what your experiences are coming in with. So if students have perhaps a slightly lower GPA, perhaps they have a graduate degree that they’ve done really well in but so much in terms of the undergraduate level, or they have a stronger tax background or work background coming in, these are certain things we can certainly discuss to see whether or not you would meet those requirements.

But if you are out of – like I said, sort of the standards, the admission requirements that are listed on the slide and you’re wondering whether or not based on your own background and credentials would you qualify? I’d definitely reach out to myself and we can certainly have more of a discussion at more length.

Angela LaGamba: All right. Let’s see. The next question that we have is around 2017 and how the start dates work for that year. Go ahead, Michelle.

Michelle Yan: So typically with this MS in Tax program there are six start dates throughout the year. This is when it is flexible because of busy season and so forth. So the way we split our year up is a trimester. So January through April is what we consider our Spring semester and we have actually two start dates beginning in Spring of 2017. The first start date begins on January 9th, and then the second start date begins

February 13th. So those are our two Spring starts.
Now for individuals who are saying during busy season it’s highly unlikely that I will take courses during this timeframe, we certainly do have starts after April 15th, and I believe the first Summer start that begins in May will begin May 1st. So that’s something that individuals are considering. That well maybe I can consider something like this after tax season. The May time frame may work. Like I said, we do have another two start dates in the summer in May and the June timeframe of 2017.

Angela LaGamba: Okay, thank you very much, Michelle. So for our audience that is all the questions that we have on screen for now, but I just wanted to turn it over to our Professor and to Michelle to see if they had any final thoughts that they wanted to share with our perspective students. Go ahead, Professor.

Timothy Rupert: Again, just I hope that we gave you a good sense of what our courses are like. If you have any questions you can feel free to reach out to me, you can get in touch with me through Northeastern’s website you’ll find my contact information on there or you can contact Michelle and she can get those questions over to me. But I look forward to working with some of you down the road.

Angela LaGamba: Great, thank you very much, Professor and to Michelle for talking to us a little bit about the program and giving us some insight into the courses that are coming up for 2017. This concludes our session and have a great day everyone.