Purpose À This chapter applies an "integrative" model to examine the impact and interaction of economic and moral/social factors in the corporate tax compliance context. More specifically, it examines whether social norms moderate the effect of economic factors in this context.Design/methodology À Fifty-five MBA students assumed corporate CFO roles and analyzed a proposed aggressive corporate tax shelter transaction ("tax shelter"). Participants indicated whether they would recommend the tax shelter and answered questions regarding the transaction and their corporate tax compliance views.Findings À Hierarchical Regression results indicate that, in the corporate tax compliance context, decision makers' norms (moral/social factors) moderate the effect of perceived expected value of aggressive tax transactions (economic factors). More specifically, results indicate that (1) perceived legality of aggressive corporate tax transactions significantly impacts willingness of corporate decision makers to recommend them, even when controlling for perceived economic effect of the transaction, and (2) due to moral/social factors, corporate decision makers often may not support aggressive tax treatments with material positive expected values.Practical implications À Accordingly, (1) custom and social factors should be integrated into the corporate tax compliance decision-making framework, and (2) campaigns to strengthen corporate tax compliance should focus on the law's text and intent as well as upon sanctions for noncompliance.

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The growing popularity of Master of Accounting programs can be attributed to multiple factors, but the states' adoption of the 150-credit hour educational prerequisite for Certified Public Accountant licensure was clearly influential in stimulating enrollment growth. Despite the growth and importance of Master of Accounting programs, comparative data of program prerequisites and curriculum is scarce. Equally limited are empirical analyses of the effects of graduate curriculum upon CPA Exam passage rates. To address the paucity of information, we examined the program prerequisites and curriculum of 283 Master of Accounting programs, all of which are based in the United States and accredited by the Association to Advance Collegiate Schools of Business. This exploratory study examines (a) commonalities and differences among Master of Accounting program curriculum, (b) relationships between university resource levels and CPA Exam passage rates, and (c) whether programs with a flexible curriculum, providing greater student customization of elective coursework, report higher CPA Exam passage rates.

In the late 1990s, controversy over alleged Internal Revenue Service abuses and concern about the extent of the agency's power over taxpayers led to the passage of new rules governing relations between the IRS and taxpayers. An important element of this new set of rules was I.R.C. § 7491, which purported to shift the burden of proof in civil tax cases from the taxpayer to the IRS. Commentators generally agreed that the shift would have little effect on the outcome of cases, but the popular press touted the new provision as an important step to level the playing field between the parties. We conduct an experiment in which we manipulate the applicability of I.R.C. § 7491 and measure role in the tax system (taxpayer versus tax professional). As predicted, we find that taxpayers assess a higher likelihood of success in litigation when the anticipated burden of proof rests with the IRS than when the anticipated burden of proof rests with the taxpayer. Taxpayers who believe that the IRS bears the burden of proof also assess a higher likelihood of success than do tax professionals, regardless of the applicability of I.R.C. § 7491. This increased perceived likelihood of success in litigation translates to an increased willingness on the part of taxpayers to engage in an unsound tax-motivated transaction.