TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Sunday, April 22, 2018

The Top Five New Tax Papers

SSRN LogoThere is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new paper debuting on the list at #5:

  1. [778 Downloads]   Evaluating the New US Pass-Through Rules, by Dan Shaviro (NYU)
  2. [331 Downloads]  Taxing Income Where Value Is Created, by Allison Christians (McGill) & Laurens van Apeldoorn (Leiden)
  3. [326 Downloads]  The Impact of the 2017 Act's Tax Rate Changes on Choice of Entity, by Jim Repetti (Boston College)
  4. [312 Downloads]  Explaining Choice-of-Entity Decisions by Silicon Valley Start-Ups, by Gregg Polsky (Georgia)
  5. [298 Downloads]  Taxation of Investments in Bitcoins and Other Virtual Currencies: International Trends and the Brazilian Approach, by Flavio Rubinstein (Fundação Getúlio Vargas) & Gustavo Gonçalves Vettori (University of São Paulo)

April 22, 2018 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, April 21, 2018

This Week's Ten Most Popular TaxProf Blog Posts

Barbara Bush: The Power And Grace Of A Mother’s Love

BushNew York Times op-ed:  For Mrs. Bush, by James McBride (NYU):

Mommy’s children were black. Mrs. Bush’s were not. Neither cared about that. They were, ultimately, mothers.

I’ve thought a lot about that since Mrs. Bush died. About that common ground. And about where we all live now.

I do not know enough about American politics to venture informed opinions about power, other than I wake up every day since the last presidential election feeling as if I’m living a nightmare. But Mrs. Bush was beyond politics. She represented a far greater power. She represented the power and grace of a mother’s love.

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April 21, 2018 in Legal Education, Tax | Permalink | Comments (0)

100% Of First-Time Takers From Shuttered Charlotte Law School Failed February NC Bar Exam

Charlotte Logo (2016)Charlotte Observer, Last Class of Charlotte School of Law Faces Bleak Reality After Bar Exam Results:

A chaotic year at Charlotte School of Law has given way to a disastrous performance by its graduates on the most recent bar examination, according to newly released state figures. Eleven recent alumni of the defunct school took the test for the first time in February. All failed.

Among the Charlotte Law graduates who had taken the test before, eight out of 73 passed the most recent exam. Combined, that gives Charlotte Law an overall passing rate of 9.5 percent — by far the lowest of the state's seven law schools.

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April 21, 2018 in Legal Education | Permalink | Comments (0)

Zelinsky: New Section 4968 And Taxing All Charitable Endowments

Edward A. Zelinsky (Cardozo), Section 4968 and Taxing All Charitable Endowments: A Critique and Proposal, 38 Va. Tax Rev. ___ (2018):

Section 4968, recently added to the Internal Revenue Code,imposes a tax on the investment incomes of some college and university endowments. Critics of Section 4968 disparage this new tax as selectively targeting what are widely perceived as wealthy, politically liberal institutions such as Harvard, Yale,Princeton, M.I.T. and Stanford.

There is a strong tax policy argument for taxing the net investment incomes of all charitable endowments including donor-advised funds, community foundations, all educational endowments,and foundations supporting hospitals, museums and other eleemosynary institutions.

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April 21, 2018 in Scholarship, Tax | Permalink | Comments (0)

Friday, April 20, 2018

ABA Releases Class Of 2017 Employment Data: FT-LT Bar Passage Required/JD Advantage Jobs Increased To 75.3% (From 72.6%), Due To 6% Decline In Class Size

Press Release, ABA Legal Education Section Releases Employment Data for Graduating Law Class of 2017:

Employment data for the graduating law class of 2017 as reported by American Bar Association-approved law schools to the ABA Section on Legal Education and Admissions to the Bar is now publicly available.  

The aggregate national data on law graduate employment outcome for the class of 2017 and individual schools' post-graduate employment figures can be found online. An online table also provides select national side-by-side comparisons between the classes of 2017 and 2016.

The aggregated school data shows that 75.3 percent of the 2017 graduates of the 204 law schools approved by the ABA to offer the J.D. degree were employed in full-time long-term Bar Passage Required or J.D. Advantage jobs roughly 10 months after graduation. That compares to 72.6 percent of the graduates reporting similar full-time long-term jobs last year.

ABA

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April 20, 2018 in Legal Education | Permalink | Comments (0)

Weekly SSRN Tax Article Review And Roundup: Stevenson Reviews Sugin's Competitive Philanthropy

This week, Ariel Jurow Stevenson (NYU; moving to San Diego) reviews a new work by Linda Sugin (Fordham), Competitive Philanthropy: Charitable Naming Rights, Inequality, and Social Norms, 79 Ohio St. L. J. __ (2018).

StevensonDespite decades of research, experts have not reached a firm conclusion regarding whether and how much the charitable deduction increases giving. As Linda Sugin convincingly argues in her recent article, this uncertainty should not counsel towards abandoning the deduction, but rather embracing it for the key social functions it performs. Shifting the focus away from economic factors, Sugin explains that the charitable deduction is important for signaling the value of communal support and deconcentrating wealth at the top of the income distribution. Sugin’s article offers a timely and vital critique of the charitable deduction literature’s overly narrow focus on economic analysis, and suggests a novel policy solution directed at today’s pressing social problems.

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April 20, 2018 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Tax Policy In The Trump Administration

Desai: Tax Reform, Round One

Mihir A. Desai (Harvard), Tax Reform, Round One:

The Trump Administration's successful efforts at tax legislation stand out as the primary achievement of its first year. But the hurried, largely furtive drafting, and rush to passage at the end of 2017, have helped obscure the new tax regime’s real impact. Much of the reporting and debate has focused on the politicking that went into passing the bill, and the purported effect on the federal budget deficit. That has diverted attention from the true significance of the Tax Cuts and Jobs Act (TCJA). Instead of simply changing rates and addressing loopholes, the TCJA represents a structural change to the income tax and, consequently, will lead to major changes in behavior. Teasing out those details reveals that the new law is likely to generate different incentives for economic growth than commonly claimed, unwanted complexities that invite still further gaming of the tax code (which the reforms themselves were intended to minimize), and larger deficits than forecast. If the past is a guide, and we can hope it is, the TCJA will be a precursor to further reforms that correct these shortcomings and address important distributional and fiscal concerns.

In the context of other legislation during the past 40 years, the magnitude of this tax reform is unremarkable when framed relative to gross domestic product. Indeed, the 1981 tax bill reduced federal revenue by an amount equaling more than twice the share of the estimated reduction in the Trump edition. But no reform during the last four decades approximates the scope and depth of the TCJA’s changes to the overall structure of the tax system.

Harvard 1

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April 20, 2018 in Tax, Tax Policy in the Trump Administration | Permalink | Comments (0)

February Bar Exam Performance Hits Record Low

MBELaw.com, February Bar Exam Performance Hits Record Low:

A decline in the average MBE score from the February 2018 bar exam does not bode well for pass rates, which are beginning to trickle out.

Performance of law graduates taking the attorney licensing test in February has hit the lowest point in more than a decade, while scores for those taking the exam during the more popular July session have been on the upswing.

According to the National Conference of Bar Examiners, the average score on February’s Multistate Bar Exam—the 200 multiple-choice question portion of the test used by all jurisdictions—fell 1.3 points from the previous year, to 132.8. That’s the lowest average in more than 10 years, and marks the fourth straight year that the February average declined.

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April 20, 2018 in Legal Education | Permalink | Comments (0)

Tax Day In The Age Of Trump: Read Thoreau

HDTNew York Times op-ed:  It’s Tax Day. Don’t Forget to Read Thoreau., by Sarah Vowell:

Henry David Thoreau delivered a lecture on “resistance to civil government” that would acquire the post-mortem title “Civil Disobedience.” He wonders: “How does it become a man to behave toward this American government today? I answer, that he cannot without disgrace be associated with it.” ...

[F]or six years Thoreau did not pay his taxes. He asks, “When I meet a government which says to me, ‘Your money or your life,’ why should I be in haste to give it my money?” And so he went to jail — for a single night. “For some one” — probably his aunt — “interfered, and paid that tax.”

Rereading “Civil Disobedience” annually, around tax time, is on the same to-do list as sending forms to my accountant and gathering the wadded-up receipts that suggest that my job is not writing but drinking tea in airports. Because the point of Thoreau’s admitted “harsh and stubborn and unconciliatory” rant is worth remembering at least once a year: Our money makes us complicit. You and I paid for the rope at Abu Ghraib just as our forebears footed the bill for Gen. Winfield Scott and Capt. Robert E. Lee to dock at Veracruz in 1847 and follow the trail blazed by Hernán Cortés to storm Mexico City because the guy in the White House really needed Utah.

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April 20, 2018 in Tax | Permalink | Comments (0)

Second Law Prof Whistleblower Suit Against InfiLaw Unsealed

Arizona Summit Logo (2015)Law.com, Second Law Prof Whistleblower Suit Against InfiLaw Unsealed:

A newly unsealed whistleblower lawsuit filed by two former professors at Arizona Summit Law School alleges that the school and its owner, InfiLaw Corp., violated federal student loan rules in order to collect more than $533 million in government-backed financial aid from 2012 to 2015.

The qui tam suit, which the plaintiffs voluntarily dismissed in February and the court unsealed March 26, is the second whistleblower suit brought by faculty from an InfiLaw school to be made public. Another case focusing on InfiLaw’s now defunct Charlotte School of Law makes similar claims to the Arizona suit, and is still pending. Arizona Summit and InfiLaw’s Florida Coastal School of Law are for-profit institutions, as was Charlotte.

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April 20, 2018 in Legal Education | Permalink | Comments (0)

Tax Development Journal Publishes New Issue

TDJ4The Tax Development Journal of California State University, Northridge (a double-blind, peer-reviewed journal), has published Volume 8 (Spring 2018):

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April 20, 2018 in Scholarship, Tax | Permalink | Comments (0)

Weekly Legal Education Roundup

Thursday, April 19, 2018

Proposed Student Loan Cap Could Cause 20-30 Law Schools To Close Within Five Years

National Law Journal, Proposed Student Loan Cap Could Devastate Law Schools:

A bill wending its way through Congress would cap graduate federal student loans and drive many law students into the private loan market, potentially forcing between 20 and 30 law schools to close within five years.

That’s the dire prediction offered to a group of legal educators by Chris Chapman, president of AccessLex Institute, a former private student loan provider and nonprofit organization that now advocates for greater access to law school. Chapman’s warning cast a pall over the Summit on the Future of Legal Education and Entry to the Profession, where law deans, professors and other interested parties assembled last week at Florida International University College of Law for two days to contemplate how to address legal education’s myriad woes. ...

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April 19, 2018 in Legal Education | Permalink | Comments (4)

Columbia Journal Of Tax Law Publishes New Tax Matters: The U.S. And The WTO

Columbia Journal of Tax Law LogoThe Columbia Journal of Tax Law has published a new issue of its Tax Matters feature, with short pieces by tax practitioners responding to a specific cutting-edge tax law issue posed by a tax academic.
Reuven S. Avi-Yonah (Michigan), Does the United States Still Care About Complying With Its WTO Obligations?, 9 Colum. J. Tax L. Tax Matters 12 (2018):

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April 19, 2018 in Scholarship, Tax | Permalink | Comments (0)

Conservative Law Prof Heckled by CUNY Protestors

CUNYNational Law Journal, Conservative Law Prof Heckled by CUNY Protestors Warns of Troubling Trend:

[O]n March 29, students at the City University of New York School of Law held protest signs and heckled Josh Blackman, a professor at South Texas College of Law Houston, who had been invited by the campus chapter of the Federalist Society to talk about free speech.

Blackman, who is right of center and has defended the legality of some of President Donald Trump’s actions, went public last week with his experience at the school, posting a video that showed him navigating a protestor-packed corridor and struggling to deliver his remarks over the interjections of students standing inches away. The signs called Blackman a white supremacist, oppressor, and racist, among other things. (The student protesters appear to have taken particular issue with Blackman’s support of Trump’s decision to rescind the Deferred Action of Childhood Arrivals program on the grounds that its creation was unlawful. Blackman said during his remarks that he supports the DREAM Act.) The protesters left the room after 10 minutes, but Blackman scrapped his prepared remarks and instead took questions from students.

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April 19, 2018 in Legal Education | Permalink | Comments (2)

Camp: A New In Camera Review Requirement For Summons Proceedings?

Bryan Camp (Texas Tech), A New in Camera Review Requirement for Summons Proceedings?, 158 Tax Notes 1201 (Feb. 26, 2018):

This paper looks at what appears to be an emerging trend in tax summons enforcement: that district courts actually review documents for which the summoned party claims a privilege. In December 2017 the Ninth Circuit seemingly joined the Second Circuit and the D.C. Circuit in finding that a district court's failure to review documents in camera was an abuse of discretion.

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April 19, 2018 in Scholarship, Tax | Permalink | Comments (0)

Phil Hackney Leaves LSU For Pittsburgh

HackneyPhilip Hackney, James E. and Betty M. Phillips Professor of Law at LSU, will join the Pittsburgh tax faculty in Fall 2018:

Phil Hackney joins Pitt Law from the Louisiana State University’s Paul M. Hebert Law Center, where he has been a member of the faculty since 2011. Hackney’s scholarship focuses on the law that governs the nonprofit tax-exempt sector of the economy, such as charities, social welfare organizations, labor unions, and trade associations. In addition to his scholarly work, he has been published in the Washington PostThe New Republic, and Salon. He is frequently quoted in the press as a national expert on nonprofit organizations.

Hackney is deeply engaged in law reform efforts. He served as a member of the Advisory Committee to the Independent Sector to update its Ethics and Principles of Good Governance for Nonprofit Organizations in 2014. In Louisiana, he served as a member of the Louisiana Tax Institute, a state board created to aid the state in improving its tax system. He also served as a member of the Corporations Committee of the Louisiana Law Institute to revise the limited liability company statute of Louisiana. He is an author of a treatise on Limited Liability Companies in Louisiana.

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April 19, 2018 in Legal Education, Tax, Tax Prof Moves | Permalink | Comments (1)

When Can A University Read Faculty Email?

Gmail (2014)Inside Higher Ed, Who’s Reading Your Email?:

In 2016, two faculty members at the University of Rochester filed a sexual harassment complaint against their colleague T. Florian Jaeger.

The two faculty members, Richard Aslin and Jessica Cantlon, said they were whistle-blowers, acting to protect their students from a potentially predatory professor. They expected support from their institution, but, they said, they didn't get it.

After insisting that the university’s two internal investigations into Jaeger (which both found no evidence of wrongdoing) had been flawed, Aslin and Cantlon said the university administration turned on them. Both faculty members had their university email accounts searched by administrators in an apparent attempt to find information that might be used to discredit them, they said.

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April 19, 2018 in Legal Education | Permalink | Comments (2)

Today Is Tax Freedom Day — Earlier In LA, TN, AL & OK, Later In NY, NJ, CT & IL

Tax Foundation, Tax Freedom Day 2018 is April 19th:

  • Tax Freedom Day is a significant date for taxpayers and lawmakers because it represents how long Americans as a whole have to work in order to pay the nation’s tax burden.
  • This year, Tax Freedom Day falls on April 19, 109 days into 2018.
  • Tax Freedom Day will be three days earlier than it was in 2017, in large part due to the recent federal tax law, the Tax Cuts and Jobs Act, which significantly lowered federal individual and corporate income taxes.
  • In 2018, Americans will pay $3.4 trillion in federal taxes and $1.8 trillion in state and local taxes, for a total bill of $5.2 trillion, or 30 percent of the nation’s income.
  • Americans will collectively spend more on taxes in 2018 than they will on food, clothing, and housing combined.
  • If you include annual federal borrowing, which represents future taxes owed, Tax Freedom Day would occur 17 days later, on May 6th.

Tax Freedom Day

Center on Budget and Policy Priorities, Tax Foundation Figures Do Not Represent Typical Households’ Tax Burdens:

The Tax Foundation released its annual “Tax Freedom Day” report today that, once again, can leave a strikingly misleading impression of tax burdens — showing an average federal tax rate across the United States that’s likely higher than the tax rate that 80 percent of U.S. households actually pay.

To project the day when “the nation as a whole has earned enough money to pay its total tax bill for the year,” the Tax Foundation calculates the average tax rate by measuring tax revenues as a share of the economy (similar to estimates of total revenues as a share of gross domestic product, or GDP).

In a progressive tax system like that of the United States, only upper-income households on average pay federal tax at rates that are equal to or above federal revenues as a share of the economy.  Estimates from the nonpartisan Tax Policy Center (TPC) show that low- and middle-income households (about 80 percent of all households) will pay a smaller share of their income in federal taxes this year than the Tax Foundation’s average tax rate.

The Tax Foundation acknowledges this issue in a methodology paper addressing its calculation of Tax Freedom Day, noting that its estimates reflect the “average tax burden for the economy as a whole, rather than for specific subgroups of taxpayers.” Consequently, those who report on Tax Freedom Day as if it represents the day until which the typical American must work to pay his or her taxes are misinterpreting these figures and inadvertently fostering misimpressions about the taxes that most Americans pay.

Moreover, the Tax Foundation suggests that people spend part of the year working for the government and part of it working for themselves, becoming “free” only when they get to work for themselves.  In reality, taxes pay for services that benefit us every day and are central to our idea of freedom.  Few Americans would likely feel more “free” if Tax Freedom Day came earlier in the year because the federal government stopped providing for national security, maintaining infrastructure, conducting food safety inspections, or testing prescription drugs.

Finally, the report’s estimates of state and local tax burdens suffer from a number of serious methodological flaws (see box below).

April 19, 2018 in Tax | Permalink | Comments (0)

Uber Driver Tried To Abduct Law Prof Nancy Leong On Way To Airport

LeongABA Journal, Law Professor Says Uber Driver Tried to Abduct Her on Ride to the Airport:

A law professor said an Uber driver tried to take her to a hotel against her will on her way to the airport. 

Nancy Leong, a professor at the University of Denver Sturm College of Law, described Tuesday’s incident through a series of posts on her Twitter account and called on Uber to take action. USA Today, the Huffington Post and Denver7 also have stories.

Leong said the driver exited the highway saying he was going to take her to a hotel. According to her tweets, when the car stopped at a red light at the bottom of a highway ramp, she started screaming “let me out of the fucking car” and pounded on the windows. The driver did not unlock the doors until nearby construction workers noticed her. She got out 

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April 19, 2018 in Legal Education | Permalink | Comments (2)

Wednesday, April 18, 2018

Florida Tax Review Publishes New Issue

Florida Tax Review (2018)The Florida Tax Review has published Vol. 21, No. 1:

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April 18, 2018 in Scholarship, Tax | Permalink | Comments (0)

Columbia Journal Of Tax Law Publishes New Tax Matters: Charitable Contributions And State Tax Credits

Columbia Journal of Tax Law LogoThe Columbia Journal of Tax Law has published a new issue of its Tax Matters feature, with short pieces by tax practitioners responding to a specific cutting-edge tax law issue posed by a tax academic.
Kirk J. Stark (UCLA), The Tax Treatment of Charitable Contributions & State Tax Credits, 9 Colum. J. Tax L. Tax Matters 1 (2018):

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April 18, 2018 in Scholarship, Tax | Permalink | Comments (0)

Los Angeles Law Firms After The Financial Crisis

L.A.James Park (Lowell Milken Institute for Business Law and Policy, UCLA), Law Firms in Los Angeles After the Financial Crisis (Mar. 2018):

  • While the L.A. legal market has recovered from the economic slide of 2008, large L.A.-based firms now have 20 percent fewer lawyers here than they did in 2008.
  • Since 2008, several firms based in other major cities have opened in Los Angeles or increased the number of lawyers here. Overall, these firms have about 1,000 more lawyers in Los Angeles than they did in 2008.
  • Los Angeles firms have increased leverage by significantly reducing their associate-to-partner ratios.
  • Firms with their largest offices in Los Angeles have seen substantial increases in profits per partner and revenue per lawyer in the last decade.

LA1

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April 18, 2018 in Legal Education, Think Tank Reports | Permalink | Comments (0)

IRS Website Crashes On Tax Day; Millions Of Last-Minute Filers Told 'Come Back On Dec. 31, 9999'

IRSNew York Times, I.R.S. Website Crashes on Tax Day as Millions Tried to File Returns:

Millions of taxpayers who waited until Tuesday to file their 2017 tax returns and make payments through the Internal Revenue Service’s website were thwarted by a systemwide computer failure that advised last-minute filers to “come back on Dec. 31, 9999.”

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April 18, 2018 in IRS News, Tax | Permalink | Comments (1)

Sugin: Competitive Philanthropy — Charitable Naming Rights, Inequality, And Social Norms

Linda Sugin (Fordham), Competitive Philanthropy: Charitable Naming Rights, Inequality, and Social Norms, 79 Ohio St. L. J. ___ (2018):

Income inequality today is at a high not seen since the 1920s, and one way the very richest display their wealth is through charitable giving. Gifts in excess of $100 million are no longer rare, and in return for their mega-gifts, the biggest donors get their names on buildings, an astonishingly valuable benefit that the tax law ignores. The law makes no distinction between a gift of $100 and a gift of $100 million.

This Article argues that the tax law of charity should focus on the very rich and harness the culture of philanthropy among the elite. The law should encourage and celebrate what this Article calls “competitive philanthropy,” which defines philanthropic success as inspiring others to exceed your generosity. To promote competitive philanthropy, this Article proposes a legal regime that includes both more and less generous elements for donors than current law. It introduces a hierarchy of gift restrictions that calibrates the charitable deduction to reflect the burdens that restrictions impose on charities, disfavoring perpetuity and mission-diverting restrictions. It recommends eschewing the standard donor-centered perspective of the tax law to consider the perspective of charities.

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April 18, 2018 in Scholarship, Tax | Permalink | Comments (0)

Columbia Journal Of Tax Law Publishes New Tax Matters: Tax Treatment Of A Marijuana Business

Columbia Journal of Tax Law LogoThe Columbia Journal of Tax Law has published a new issue of its Tax Matters feature, with short pieces by tax practitioners responding to a specific cutting-edge tax law issue posed by a tax academic.
Douglas A. Kahn (Michigan), The Tax Treatment of a Marijuana Business, 8 Colum. J. Tax L. Tax Matters 23 (2017):

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April 18, 2018 in Scholarship, Tax | Permalink | Comments (2)

Diamond: BLS Data Show Lawyer Employment, Incomes Continue To Rise

BLS (2015)Stephen F. Diamond (Santa Clara), Good News For Lawyers From the BLS: Incomes and Employment Up Yet Again:

Continuing a decades old trend, employment of lawyers increased yet again from May, 2016 to May, 2017, in the latest data released March 30, 2018, by the Bureau of Labor Statistics. (The data exludes partners, who are not defined as “employees,” and may also exclude some solo practitioners.) Nationally, there were 628,370 people employed by lawyers as of May, 2017 compared to 619,530 a year earlier, representing an increase (net of retirements, deaths, and changes of employment) of 8,840 lawyers. ...

Incomes were up, yet again, as in every year but one over the last two decades. The mean wage as of 2017 was $141,890 and the median was $119,250. This compares to $139,880 and $118,160 for the prior year. The increase of approximately 1.4% was in line with inflation. ...

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April 18, 2018 in Legal Education | Permalink | Comments (1)

Hemel & Herzig: Scott Pruitt’s Travel Could Leave Him With A Big Tax Bill

Washington Post op-ed:  Scott Pruitt’s Travel Could Leave Him With a Big Tax Bill, by Daniel Hemel (Chicago) & David Herzig (Valparaiso):

Scott Pruitt could be in tax trouble on top of his ethical and political problems.

The embattled administrator of the Environmental Protection Agency has reportedly spent nearly $3 million on security and travel since taking office in February 2017. That sum apparently includes the cost of a security detail that accompanied Pruitt and his family on a vacation to Disneyland and the Rose Bowl this winter.

Pruitt might owe federal and D.C. taxes on a large chunk of that money.

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April 18, 2018 in Tax | Permalink | Comments (0)

Tuesday, April 17, 2018

Satterthwaite Presents Electing Into A Value-Added Tax Today At NYU

SatterthwaiteEmily Satterthwaite (Toronto) presents Electing into a Value-Added Tax: Evidence from Ontario Micro-Entrepreneurs at NYU today as part of its Tax Policy Colloquium Series hosted by Lily Batchelder and Daniel Shaviro:

Across countries, value-added tax (VAT) statutes typically recognize the disproportionate burden of VAT compliance for smaller firms by exempting “small suppliers” (defined as businesses with annual revenues less than a specified registration threshold) from the obligation to register for, collect, and remit VAT on their sales.  But most input-credit-style VATs also offer small suppliers a curious choice: they can elect into the VAT by voluntarily registering.  Because VAT paid on inputs is refundable for registered firms, small suppliers have stronger incentives to voluntarily register as they (1) purchase more of their inputs from registered firms (the “input channel”) or (2) sell more of their output to registered firms (the “customer channel”).  In theory, these “formality chain effects” can improve the efficiency of a VAT.  In practice, however, many VATs feature registration thresholds that are far lower in dollar terms than recommended by economists.  Where a registration threshold is very low, might microenterprises’ high VAT compliance costs weaken their incentives to voluntarily register, thereby undermining the policy rationale for offering the election?  This paper uses qualitative and quantitative research methods to explore the relevance of the formality chain effect theory in the context of a low registration threshold.

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April 17, 2018 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Mehrotra Presents T.S. Adams And The Beginning Of The Value-Added Tax Today At Georgetown

Mehrotra (2017)Ajay Mehrotra (American Bar Foundation & Northwestern) presents Economic Expertise, Democratic Constraints, and the Historical Irony of U.S. Tax Policy: Thomas S. Adams and the Beginnings of the Value-Added Tax at Georgetown today as part of its Tax Law and Public Finance Workshop Series hosted by Lilian Faulhaber and Itai Grinberg:

I have recently embarked upon a new long-term research project (The VAT Laggard: A Comparative History of U.S. Resistance to the Value-added Tax), which explores why the United States remains the only advanced, industrialized nation that continues to resist the global spread of the value-added tax (VAT). The first part of this comparative-history project examines the 1920s intellectual beginnings of the VAT in the United States.

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April 17, 2018 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

ABA Committee Proposes Eliminating The LSAT Requirement For Law School Admissions

GRELSAT2Law.com, LSAT's Grip on Law Schools Loosens With ABA's Latest Move:

The American Bar Association’s longstanding requirement that law schools use the LSAT in admissions looks to be on the way out.

An ABA committee on April 13 recommended axing the accreditation standard mandating that schools use a standardized test in admissions. That move would eliminate the LSAT’s status as the only test specifically allowed by the ABA.

That change, should it be approved by the ABA’s Council of the Section of Legal Education and Admissions to the Bar and the ABA’s House of Delegates later this year, would pave the way for schools nationwide to use the Graduate Record Exam (GRE) and other alternative tests. Thus far, 17 law schools are accepting or have said they soon will accept the GRE alongside the LSAT. But other campuses have been awaiting a decision from the ABA to clarify whether the GRE is allowed under its accreditation standards.

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April 17, 2018 in Legal Education | Permalink | Comments (0)

John Oliver: Corporate Taxes

The Five Types of Professors: Which One Are You?

Chronicle of Higher Education, The 5 Types of Professors: Which One Are You?:

Efforts to dictate or even describe the work habits of professors are often controversial. They also have a blind spot: Such exercises often fail to account for the different roles that faculty members fill.

That observation led a team of researchers from the Center for Postsecondary Research, at Indiana University at Bloomington, to examine the time that professors devote to the key components of professorial work: teaching, research, and service.

The report, Faculty Types and Effective Teaching: A Cautionary Exploration of How Faculty Spend their Time, maps out five core types of faculty members based on the relative amounts of time they spend on those three core areas of work. It captures a more nuanced view of faculty roles than job titles provide.

CHE 2

Here’s what the researchers found about the five types:

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April 17, 2018 in Legal Education | Permalink | Comments (0)

Columbia Journal Of Tax Law Publishes New Issue

Columbia Journal of Tax Law LogoThe Columbia Journal of Tax Law has published Vol. 9, No. 2:

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April 17, 2018 in Scholarship, Tax | Permalink | Comments (0)

More Evidence That Student Evaluations Are Biased Against Women

Following up on last week's post, Students Rate Male Professors More Highly Than Female Professors:  Daily Tar Heel, NC State Research Shows Male Professors Receive Higher Ratings Than Female:

UNC

For professors, student evaluations are used to assist decisions on promotions, raises and tenure. But research from North Carolina State University shows that the evaluations a professor receives are linked to their gender, with male professors receiving higher and more favorable ratings than female professors [What’s in a Name: Exposing Gender Bias in Student Ratings of Teaching].

In 2014, researchers at N.C. State used online courses, where an instructor’s gender could be hidden, to test this gender bias. Four sections of an online class were taught by two instructors: a female instructor and a male instructor. Each taught two sections, using their true identity for one and adopting a name of the opposite gender for the other.

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April 17, 2018 in Legal Education, Teaching | Permalink | Comments (4)

Christian Who Cites Opposition To Abortion For Not Paying Taxes Wins Round 1 In Federal District Court

The Oregonian, Man Who Cites Opposition to Abortion For Not Paying Taxes Wins Round 1 in Court:

A federal judge has dismissed a felony tax evasion charge against a man who describes himself as a Christian who refuses to give money to the government to support abortion.

U.S. District Judge Michael W. Mosman ruled that the government's indictment failed to provide any evidence that Michael Bowman tried to conceal or mislead government officials by simply cashing his checks and keeping a low bank balance so tax collectors couldn't garnish his account to pay taxes.

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April 17, 2018 in New Cases, Tax | Permalink | Comments (3)

Monday, April 16, 2018

Ariel Stevenson, NYU VAP, To Join San Diego Tax Faculty

StevensonAriel Jurow Stevenson (Acting Assistant Professor of Tax Law, NYU) has accepted a tenure-track position at San Diego, beginning in August 2018.

  • JD 2014, Yale
  • MSc (Economic Development) 2008, London School of Economics and Political Science
  • BA (Economics & International Development Studies) 2007, UCLA

Before joining NYU, Ariel received a Skadden Fellowship to work at Bet Tzedek Legal Services in Los Angeles, where she founded and directed a program that provides tax legal services to low-income and immigrant workers. She represented low-income clients in state and federal tax controversies, and regularly served as an advisor on tax issues for public interest attorneys throughout California.

Ariel's publications include:

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April 16, 2018 in Legal Education, Tax, Tax Prof Moves | Permalink | Comments (0)

WSJ: Hedge-Fund Star John Paulson Owes $1 Billion In Taxes Tomorrow

Wall Street Journal, Worried About Your Tax Bill? Hedge-Fund Star John Paulson Owes $1 Billion:

John Paulson won fame after he made one of the greatest financial bets of all time. What comes next? One of the largest-ever personal tax bills.

By April 17, the hedge-fund manager must make federal and state tax payments of about $1 billion, on top of roughly $500 million in taxes he paid late last year, said people close to the firm. That sum is so big it dwarfs the maximum amount the Internal Revenue Service will allow any single taxpayer to pay with a single check. (That’s $99,999,999, in case you’re wondering.)

Mr. Paulson bet big against subprime mortgages ahead of last decade’s financial crisis, earning about $15 billion of profits for his funds and approximately $4 billion for himself. He deferred the bulk of the taxes on these profits, using a tax provision available at the time to hedge-fund managers, said the people close to the firm. Now the bill is due. ...

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April 16, 2018 in IRS News, Tax | Permalink | Comments (0)

Can Tenured Faculty Contracts Be Terminated In A College's Bankruptcy?

Matthew A. Bruckner (Howard), Terminating Tenure: Rejecting Tenure Contracts in Bankruptcy, 92 Am. Bankr. Inst. L. Rev. 255 (2018):

Many institutions of higher education are in dire financial straits and will close, merge, or file for bankruptcy in the near future. This Article considers the effect of bankruptcy laws on the ability of higher education institutions to restructure their workforces and, in particular, the impact that a bankruptcy filing may have on tenured professors.

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April 16, 2018 in Legal Education, Scholarship | Permalink | Comments (7)

Kleinbard: Tax Policy Is a Bore, Until They Take Away Your Social Security And Medicare

Los Angeles Times op-ed:  Tax Policy Is a Bore, Until They Take Your Social Security and Medicare Away, by Edward D. Kleinbard (USC):

Procrastinators race to the post office on Tax Day to postmark their tax returns or file for extensions. Sensible people use Tax Day as a time to consider their financial picture for the year ahead. But this April, in light of how Congress radically rewrote our tax obligations for 2018 onward, Tax Day might also profitably serve as an occasion for citizens to contemplate the tax health of the nation.

This checkup requires examining both taxes and government spending. We quickly see that budget deficits — how much spending exceeds revenues — are extremely large and growing at a disturbing rate. The nonpartisan Congressional Budget Office estimates that the 2019 deficit will be just shy of $1 trillion. That is a roughly 50% jump in the deficit from its 2017 level — extraordinary, considering we're in good economic times.

Tax cuts do not pay for themselves — not the Trump tax cuts, nor in any other case in modern U.S. practice. So we face only two possible courses of action: Either we tax ourselves more, or we dismantle the social safety net (in particular, Social Security, Medicare and Medicaid) that protects Americans from destitution or disability. Which is the right direction for our country to pursue? ...

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April 16, 2018 in Tax, Tax Policy in the Trump Administration | Permalink | Comments (4)

Muller: Visualizing Law School Employment Outcomes In Florida, Pennsylvania, And Texas

Derek Muller (Pepperdine) has published several posts (with great charts and tables) in his annual series visualizing employment outcomes of law school graduates in various states:  Florida, (the Top 5 continue to be Florida, Miami, Florida International, Florida State, and Stetson), Pennsylvania (Penn continues to dominate), and Texas (the Top 3 continue to be Texas, Baylor, and SMU).

To me, the most interesting story is how Florida International continues its remarkable performance in bar passage and jobs.  I previously blogged July 2017 Florida Bar Exam Results: Florida International Is #1 For 4th Year In A Row.  Derek's data show Florida International #3 in the state in full credit jobs — the second year in a row it has topped the much higher ranked Florida State:

Top 5

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April 16, 2018 in Law School Rankings, Legal Education | Permalink | Comments (0)

Lesson From The Tax Court: Better Lucky Than Good

Tax Court (2017)Most of us who are either preparing our returns last week (or today), or reviewing the returns prepared for us, honestly want to get it right. We try to be good. But just as life is complex, so is the tax shadow created by life activities and decisions. Last week’s decision in Stacey S. Marks v. Commissioner, T.C. Memo. 2018-49, is not so much a lesson about being good as it is a lesson that sometimes—just sometimes—you can get lucky.

Details below the fold.

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April 16, 2018 in Bryan Camp, New Cases, Tax | Permalink | Comments (6)

The Wax Wars Rage On At Penn Law

Penn (2017)Following up on my previous posts (links below):  Forward, Is This Penn Law Professor A Truth-Teller Or A Bigot?:

The latest battle in the “free speech wars” on college campuses took place at the University of Pennsylvania this month, where a professor known for her controversial views on affirmative action was removed from her position teaching mandatory first-year classes.

Amy Wax, a tenured professor at the University of Pennsylvania Law School, had made disparaging remarks about the school’s black students and suggested that some of them should not be at the school. After the video of her remarks came to light earlier this month, the school announced that she was barred from teaching first-year students and would only teach her specific areas of expertise — but would also maintain her tenure, salary and seniority.

Her case raises questions over whether colleges will allow professors, students and speakers to express controversial or even offensive views.

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April 16, 2018 in Legal Education | Permalink | Comments (11)

TaxProf Blog Weekend Roundup

Sunday, April 15, 2018

Fourteen-Year Anniversary of TaxProf Blog

Happy AnniversaryToday (April 15, of course) marks the 14-year anniversary of TaxProf Blog (and the 23-year anniversary of the TaxProf Email Discussion Group).  I hope the blog has at least partially succeeded in its mission (announced in my very first post) to provide daily news and information of interest to law school tax professors and students; tax lawyers in private practice, government, nonprofits, for-profit corporations, and think tanks; accountants; and others in the tax community.  Here are some numbers:

  • Page Views:  93,989,209
  • Visitors:  21,800,717
  • Average Session Duration:  15 minutes, 57 seconds
  • Comments:  60,534
  • Posts:  38,954

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April 15, 2018 in About This Blog, Legal Education, Tax | Permalink | Comments (9)

Weekly Legal Education Roundup

The Top Five New Tax Papers

SSRN LogoThere is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new paper debuting on the list at #3:

  1. [680 Downloads]   Evaluating the New US Pass-Through Rules, by Dan Shaviro (NYU)
  2. [370 Downloads]  The Elephant Always Forgets: U.S. Tax Reform and the WTO, by Reuven Avi-Yonah (Michigan) & Martin Vallespinos (S.J.D. 2018, Michigan)
  3. [308 Downloads]  Taxing Income Where Value Is Created, by Allison Christians (McGill) & Laurens van Apeldoorn (Leiden)
  4. [301 Downloads]  Explaining Choice-of-Entity Decisions by Silicon Valley Start-Ups, by Gregg Polsky (Georgia)
  5. [297 Downloads]  The Impact of the 2017 Act's Tax Rate Changes on Choice of Entity, by Jim Repetti (Boston College)

April 15, 2018 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

NBC Dateline: Remembering Dan Markel

NBC News, Remembering Dan Markel:  Loved ones describe Dan as the fun-loving, welcoming friend and father they remember him to be.

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April 15, 2018 | Permalink | Comments (0)