Research Case #1. Jim Clark is a dedicated bird watcher living near Central City. Central City has recently received a large parcel of land from a long-time resident in her Last Will and Testament. The city council has created a public park improvement special assessment district to oversee the care and renovations necessary for the public park buildings and natural habitat area received adjacent to the existing city recreation areas. The special assessment district plans to sell bonds to the public in order to fund a portion of the planned development and future improvements. Mr. Clark is considering an investment in these bonds, but is unsure whether the interest income he would receive from the bonds qualifies for federal tax exemption as a government bond under the U.S. Internal Revenue Code. Prepare a written memo stating the tax research issue(s), your conclusions concerning the issue(s), and any specific statutory, regulatory, or judicial authority supporting your conclusions. Please use the example shown on page 5-15 through page 5-17 for your guide. Please show four sections of your memo (1.) Summary of the Facts, (2.) Research Issue(s), (3.) Statement of Law of Discovered Analysis, and (4.) Conclusion(s).

Subject: Tax-Acct 6170