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Wednesday, October 1, 2014

Zolt Presents Fiscal Contracting in Latin America Today at Harvard

Zolt (2014)Eric M. Zolt (UCLA) presents Fiscal Contracting in Latin America (with Richard M. Bird (Toronto)) at Harvard today as part of its Tax Law, Policy and Practice Workshop Series hosted by Daniel Halperin and Stephen Shay:

Latin America has long been characterized as a region of high income inequality. In recent years, however, many countries have seen a decrease in income inequality and poverty levels and an increase in economic mobility. Fiscal policies have played a role in achieving these results. One important explanation for changing fiscal policies is the increasing economic and political role played by the growing middle class in shaping the level and quality of collective goods and services and the types of taxes and relative tax burdens to fund these expenditures. Through a process we call “fiscal contracting,” less unequal societies may be willing to pay more in taxes for expanded, relatively universal public services.

October 1, 2014 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Schön Presents International Taxation of Risk Today at Toronto

SchoenWolfgang Schön (Max Planck Institute for Tax Law and Public Finance) presents International Taxation of Risk at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series:

The allocation of risk and of the income from risky investment and activities belongs to the central topics of international tax policy today. This fact is highlighted by the current BEPS initiative of G20 and OECD which casts doubt on the recognition of contractual risk allocation within multinational groups and its impact on profit allocation between separate entities within these groups. It is largely felt that “risk shifting” provides the basis for “profit shifting” by multinationals to the detriment of states and domestic competitors.

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October 1, 2014 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Lewis & Clark Law School Closes Legal Clinic, Cites Enrollment, Revenue Decline

The Oregonian:  Lewis & Clark Law School Closes Downtown Legal Clinic, Cites Enrollment, Revenue Decline:

Lewis & Clark LogoLewis & Clark Law School is closing its namesake legal clinic in downtown Portland that provides services to the poor, a high-profile victim of the school's budget constraints.

As Lewis & Clark and the state's two other law schools get their new years underway this month, they are dealing with 13 to 30 percent enrollment declines from the peak two to four years ago. Corresponding declines in revenue have forced the schools to cut costs, downsize staff and make other efficiency moves.

"What we have to do, like everybody else, is face budget realities," said Jennifer Johnson, the new dean at Lewis & Clark. The clinic "has largely been a tuition-driven enterprise that we can't afford. It's purely financial."

The clinic's pending closure -- the doors will close Dec. 31 -- has disturbed other public-interest lawyers in town who say the move will worsen an already significant shortage of legal services for the low-income. ...

Lewis & Clark's total enrollment, including part-time evening students, hit 609 this fall. That's down from a peak of 735 in 2010.

Enrollment of law students at the University of Oregon Law School fell to 376 this year, from a peak of 526 in 2010.

Willamette Law School enrollment hit 341 this year, down from a peak of 429.

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October 1, 2014 in Legal Education | Permalink | Comments (1)

University of Arizona Professor Plagiarized Student's Work

Arizona Daily Star, UA Professor Plagiarized Student's Work, School Finds:

Arizona (University)A University of Arizona professor recently lauded as a top new teaching talent in her field has been reprimanded for plagiarizing the work of a former student.

Susannah Dickinson, an assistant professor in the UA’s school of architecture since 2009, recently received a formal admonishment from the university’s provost after the student accused Dickinson of poaching material from his master’s thesis and presenting it as her own.

The finding is a rare one in academia, where professors often are accusers rather than accused in plagiarism cases involving students.

But one national expert believes such cases happen more often than reported because graduate students fear potential repercussions if they complain about professors.

Compare the student's thesis with the professor's paper.

Chronicle of Higher Education, U. of Arizona Reprimands Professor in Wake of Plagiarism Inquiry

October 1, 2014 in Legal Education | Permalink | Comments (1)

A Mother's Love

(Hat Tip: Naomi Goodno.)

October 1, 2014 in Legal Education, Tax | Permalink | Comments (0)

The Most Underrated and Overrated BigLaw Tax Practices

Above the Law, Over- And Underrated Biglaw Practice Groups:

OuATL’s Insider Survey (17,300 responses and counting — thanks everyone!), whereby practicing attorneys and current students evaluate their own schools or employers. Among other things, our survey asks attorneys to nominate firms with over- and underrated practices within the respondent’s own practice specialty. Litigators nominate litigation departments, etc. ...

Most Overrated Tax Practices
Skadden
Cravath
Davis Polk

Most Underrated Tax Practices
Cooley
White & Case
Cahill Gordon

October 1, 2014 in Tax | Permalink | Comments (0)

UC-Berkeley Law School to Raise Tuition 5.4%

The Daily Californian, Campus Law School Proposes Tuition Increase:

UC-Berkeley (2014)In addition to the proposed supplemental tuition increase, Berkeley Law anticipates systemwide as well as campus tuition increases. Berkeley Law projects that these increases will total a 5.4-percent increase for California residents, raising the total cost of attendance from $51,320 to $54,091. Nonresidents’ total fees would increase by 5.3 percent, from $55,271 to $58,225.

Above the Law, Hey, Let’s Make Law School More Expensive! Top School Dean Proposes Tuition Increase

October 1, 2014 in Legal Education | Permalink | Comments (6)

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October 1, 2014 in About This Blog, Legal Education, Tax | Permalink | Comments (0)

Orange is the New Black, Tax Edition

OrangeAvalara, Orange is the New Black, Tax Edition:

For most businesses in most states, when you sign up to be a business owner, you sign up to collect and remit sales and use tax. This may not be forefront in the minds of future business owners of America, but it should be. Failure to collect, report and remit sales tax in a timely manner can land you behind bars (the kind that obscure the view, not the kind that serve drinks).

October 1, 2014 in Tax | Permalink | Comments (0)

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October 1, 2014 in About This Blog, Legal Education, Tax | Permalink | Comments (1)

The IRS Scandal, Day 510

IRS Logo 2Daily Caller:  After Holder: Four Things The Next Attorney General Must Address, by Dan Epstein (Executive Director, Cause of Action):

Attorney General Eric Holder may be heading for the exit door at the Department of Justice (DOJ), but numerous gaps in the agency’s enforcement remain. Will the next attorney general address fraud, transparency, and oversight concerns? We recommend four issues the next attorney general can and should resolve. ...

IRS Political Targeting: Americans have known for over a year about the Internal Revenue Service’s political targeting of non-profit groups. Cause of Action first petitioned DOJ to look into this scandal in May 2013. While an investigation has begun, the DOJ assigned an attorney from the Civil Rights Division (CRD), which mostly prosecutes hate crimes cases and conspiracies to violate civil rights, to investigate the IRS. If criminal violations are uncovered in the investigation, the CRD may not have the authority to handle them, given its jurisdiction. That is why the next attorney general should appoint a special counsel to direct the investigation.

Lois Lerner’s Emails: Perhaps the most confounding part of the IRS scandal is the somehow “lost” emails of Lois Lerner, the IRS official at the heart of the scandal. Cause of Action’s investigation indicates that in losing this valuable information, multiple government officials violated the Federal Records Act, which instructs agencies to create their own regulations regarding document retention. IRS regulations, for instance, required Ms. Lerner to print and file her emails and her attachments. By failing to preserve Lerner’s records, the IRS may have violated its own regulations — and therefore the Federal Records Act.

To this day, the Department of Justice refuses to investigate this potential violation of law, so we urge the next attorney general to conduct an investigation to determine if there has been a violation of the Federal Records Act.

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October 1, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, September 30, 2014

Elizabeth Garrett (USC) Named President of Cornell University

Cornell Press Release, Elizabeth Garrett, USC Provost, Named Cornell's 13th President:

GarrettThe Cornell University Board of Trustees today approved the appointment of Elizabeth Garrett, provost and senior vice president for academic affairs at the University of Southern California, as Cornell’s next president. Garrett will assume the presidency July 1, 2015. ...

Garrett is married to Andrei Marmor, professor of philosophy and the Maurice Jones Jr. Professor of Law at USC, who will be joining the Cornell faculty as a full professor with joint appointments in the College of Arts and Sciences and the Law School. ...

Garrett’s primary scholarly interests include legislative process, the design of democratic institutions, the federal budget process and tax policy. She is the author of more than 50 articles, book chapters and essays, and is co-author of the nation’s most influential casebook on legislation and statutory interpretation, now in its fifth edition. At Cornell, Garrett will be a tenured faculty member in the Law School with a joint appointment in the Department of Government in the College of Arts and Sciences.

Garrett has an exemplary record of public service. In 2005, President George W. Bush appointed her to serve on the nine-member bipartisan Advisory Panel on Federal Tax Reform. ... Before entering academics, Garrett served as budget and tax counsel and legislative director for Sen. David L. Boren (D-Okla.) and clerked for Justice Thurgood Marshall on the U.S. Supreme Court.

September 30, 2014 in Legal Education, Tax | Permalink | Comments (1)

Singhal Presents Firm Misreporting Behavior and Tax Evasion Substitution Today at Columbia

8171Monica Singhal (Harvard) presents Dodging the Taxman: Evidence on Firm Misreporting Behavior and Evasion Substitution (with Paul Carrillo (George Washington) & Dina Pomeranz (Harvard)) at Columbia today as part of its Tax Policy Colloquium Series hosted by Alex Raskolnikov, David Schizer, and Wojciech Kopczuk:

Reducing tax evasion is a key priority for many governments, particularly in developing countries. A growing literature has argued that the use of third party information to verify taxpayer self-reports is critical for tax enforcement and the growth of state capacity. However, there may be limits to the effectiveness of third party information if taxpayers can substitute misreporting to less verifiable margins. We present a simple framework to demonstrate the conditions under which substitution will occur and provide strong empirical evidence for substitution behavior by exploiting a natural experiment in Ecuador. We find that when firms are notified by the tax authority about detected revenue discrepancies on previously filed corporate income tax returns, they increase reported revenues, matching the third party estimate when provided. Firms also increase reported costs by 96 cents for every dollar of revenue adjustment, resulting in minor increases in total tax collection.

September 30, 2014 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Bird & Zolt: Fiscal Contracting in Latin America

Richard M. Bird (Toronto) & Eric M. Zolt (UCLA), Fiscal Contracting in Latin America:

Latin America has long been characterized as a region of high income inequality. In recent years, however, many countries have seen a decrease in income inequality and poverty levels and an increase in economic mobility. Fiscal policies have played a role in achieving these results. One important explanation for changing fiscal policies is the increasing economic and political role played by the growing middle class in shaping the level and quality of collective goods and services and the types of taxes and relative tax burdens to fund these expenditures. Through a process we call “fiscal contracting,” less unequal societies may be willing to pay more in taxes for expanded, relatively universal public services.

September 30, 2014 in Scholarship, Tax | Permalink | Comments (0)

How to Get Into an Ivy League College—Guaranteed (For $600,000)

Bloomberg, How to Get Into an Ivy League College—Guaranteed (For $600,000):

IVYThe academic transcript looked like a rap sheet. The 16-year-old had dropped out of boarding schools in England and California because of behavioral problems and had only two semesters left at a small school in Utah. Somehow, he had to raise his grade-point average above a C before applying to college. His confidence was shot, and though his parents didn’t openly discuss it, he knew they were crushed at the thought that he might not get into a reputable college. What the boy didn’t know was that back home in Hong Kong, where his dad is chief executive officer of a big publicly traded investment company, the family was calling in a miracle worker.

Through a friend, his father reached out to Steven Ma, founder of ThinkTank Learning, a chain of San Francisco Bay Area tutoring centers that operate out of strip malls. Like many in the field, Ma helps kids apply to college. Unlike his competitors, Ma guarantees that his students will get into a top school or their parents get their money back—provided the applicant achieves a certain GPA and other metrics. He also offers a standard college consulting package that doesn’t come with a guarantee; for a lower price, Ma’s centers provide after-school tutoring, test prep, college counseling, and extra class work in English, math, science, and history.

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September 30, 2014 in Legal Education | Permalink | Comments (2)

Jellum: Codifying and 'Miscodifying' Judicial Anti-Abuse Tax Doctrines

Linda Jellum (Mercer), Codifying and 'Miscodifying' Judicial Anti-Abuse Tax Doctrines, 33 Va. Tax Rev. 579 (2014):

As former President George W. Bush said once, “the tax code is a complicated mess . . . [and] a million pages long.” The length and complexity of the Internal Revenue Code (Code) is largely the result of the U.S. government’s rule-based approach to curtail tax abuse. Taxpayers, aided by literalism, have long found and used language in the tax laws to avoid or minimize their tax obligations. Although complying with the language of the law, abusive tax transactions are nevertheless at odds with the law’s spirit. Historically, the government, specifically Congress and the Department of the Treasury (Treasury), has responded by crafting new rules to stem the abuse.

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September 30, 2014 in Scholarship, Tax | Permalink | Comments (0)

Rapp: The Professor as Node

Geoffrey Rapp (Toledo), The Professor as Node:

LTIt's hard not to notice a shift this fall(?) among the lawblog world to Twitter.  Though the cool kids are already up on something called "Ello," the rest of us, having only recently figured out how to create a "split post" on a blog are now trying to limit ourselves to 140 characters through imaginative vowel-deletion.

When I entered full-time teaching, the big, symposium-worthy question was whether blogging "counted" as scholarship [Bloggership: How Blogs Are Transforming Legal Scholarship, 84 Wash. U. L. Rev. 1025-1261 (2006)]. At that time and today, I thought that question somewhat off point -- it didn't and doesn't matter whether blogging is scholarship or counts as scholarship. The only real question was whether blogging was a worthwhile activity for a scholar and teacher.  That is to say, is blogging what our students are borrowing money to have us do?  Because Twitter posts are necessarily less detailed and thus, at least individually, seem to lack the usual scholarly weight, they perhaps more obviously raise the question of appropriateness as an activity for those whose lives are funded by the future repayment obligations of others.

I've come to the opinion that Tweeting, "LinkedIn-ing", and blogging -- along with other forms of online networking -- are exactly what our students are paying us to do.

(Hat Tip: Michael Helfand.)

September 30, 2014 in Legal Education | Permalink | Comments (0)

TIGTA: IRS Does Not Adequately Research 57% of Cases, Losing Billions in Taxes Wrongly Labeled Uncollectible

TIGTA The Treasury Inspector General for Tax Administration yesterday released Delinquent Taxes May Not Be Collected Because Required Research Was Not Always Completed Prior to Closing Some Cases As Currently Not Collectible (2014-30-052):

If an IRS employee is unable to contact or unable to locate (UTC/UTL) a delinquent taxpayer, the collection case may be closed as currently not collectible (CNC). If all of the required research steps are not taken prior to the case closure, there is a risk that the Government’s interest may not be protected and that taxpayers will not be treated equitably.

In Fiscal Year 2012, the IRS closed 482,611 tax modules involving approximately $6.7 billion as CNC–UTC/UTL.  This audit was initiated to determine whether these cases were adequately researched, documented, and approved to ensure that all actions were taken to collect outstanding taxpayer liabilities.

Required case actions were not always completed before closing cases as CNC–UTC/UTL.  Of a stratified sample of 250 cases reviewed, there was no evidence that employees completed all of the required research steps for 57 percent of the cases prior to their closing.  Moreover, 7 percent of the cases did not have a Notice of Federal Tax Lien (NFTL) filed on all delinquent tax periods as required. Collection Field function (Field) employees did not complete all research in 165 of the 204 Field cases, while Automated Collection System function employees did not complete all research in eight of the 38 Automated Collection System cases

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September 30, 2014 in Gov't Reports, IRS News, Tax | Permalink | Comments (1)

Mounting Debt Makes Law School a Gamble, But Students Continue to Enroll

New York Observer:  Mounting Debt Makes Law School a Gamble But Students Continue to Enroll, by Gary M. Stern:

Law SchoolIt is a risky proposition getting a graduate degree in the humanities these days, what with the prospect of crippling debt and high unemployment rates. But enrolling in a law program is among the riskiest of all.

“Law school is a major gamble,” said Daniel A. Hochheiser, a criminal attorney and managing partner at New York-based Hochheiser & Hochheiser. “It works only for a minute number of students, leaving the majority of students holding the bag, entering a saturated market struggling with debt.”

In 2013, the average public law school graduate carried a debt of $84,600, while graduates of private colleges incurred $122,158 in debt. At the same time, legal firms are cutting back on hiring, causing a glut of attorneys and rising unemployment.

In 2012, only 56.2 percent of all law school graduates found full-time employment in their chosen field, and nearly 28 percent were unemployed or underemployed, according to Law School Transparency, a reform group.

When the end result, it seems, is likely to be high debt and little to no employment, one has to wonder why more wannabe lawyers aren’t screaming “Objection!” before they apply. ...

Oliver Bateman, an assistant professor of law at the University of Texas at Arlington, qualified Mr. Hochheiser’s sentiment, but in far blunter terms. “If you’re not going to be first at a mid-tier or lower-level school,” Mr. Bateman said, “you may as well be last.” ...

Not everyone in the field, however, is quite as negative.

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September 30, 2014 in Legal Education | Permalink | Comments (0)

Three Chicago Law Schools Prevail in Fraud Lawsuits Brought by Alumni Over Placement Data

Chicago Daily Law Bulletin, Law Schools Prevail in Suit Over Job Stats:

Disgruntled alumni from three local law schools cannot claim their schools deceived them in marketing materials containing high employment and salary statistics, the 1st District Appellate Court ruled today in a trio of orders.

For several years, The John Marshall Law School, DePaul University College of Law and IIT Chicago-Kent College of Law each published post-graduation employment rates for their classes above 90 percent.

But that rate included graduates holding a job, not necessarily one requiring the time and expense of earning a law degree.

In one published opinion and two unpublished orders — each written by Justice Mary K. Rochford, each addressing one school — the panel found the former students did not show how the data was deceptive or how the data was the cause of any injuries.

(Hat Tip: Brian Leiter.)

September 30, 2014 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 509

IRS Logo 2Christian Post:  Documentary Highlights First-Hand Accounts of IRS Targeting Conservative, Christian Groups:

A documentary set to be released in October aims to show the American public exactly how the IRS is unfairly treating certain groups by sharing first-hand experiences from those "oppressed" by the IRS.

Bothered by the reports that the IRS was targeting conservative activist groups, Craig Bergman, a former Gulf War veteran and syndicated conservative talk show host, traveled across America to get to the bottom of how the IRS was targeting these groups.

In his travels, Bergam interviewed various leaders of conservative activist groups, religious groups, veterans associations, international adoption parents and other groups. His interviewees detailed on camera how the IRS either forced them to fill out "intrusive" paperwork while filing for tax exempt status, or stalled the paperwork, making it difficult for the groups to grow in size.

The documentary, "UnFair: Exposing the IRS," was screened this past weekend at the Values Voters Summit in Washington D.C. and will premiere on Oct. 14 at over 700 theaters nationwide. The documentary uses the first-hand experiences to transition into a call to action to help abolish the IRS and the income tax and promote the Fair Tax, which would be similar to a national sales tax.

USA Today op-ed:  For Next Attorney General, Reach Across Aisle, by Glenn Reynolds (Tennessee):

Perhaps President Obama — and, for that matter, future presidents — should take a lesson from the way we handle the Department of Defense, and apply it to the Department of Justice: Consider naming someone outside his own party as attorney general.

This frequently happens with secretaries of Defense, and it has been of benefit to the administrations that have done it. FDR picked a Republican, Henry Stimson, to be secretary of War in 1940, and that meant that the war — and the war's casualties — became a bipartisan matter instead of fodder for partisan attacks. President Obama retained George W. Bush's Defense secretary, Robert Gates, for most of his first term. He replaced Gates with another Republican, Chuck Hagel, in that position.

Having a Defense secretary from the other party makes war bipartisan, and reassures members of the opposition that the powers of the sword aren't being abused. Likewise, naming an attorney general from the opposite party would tend to make the administration of justice bipartisan, and would provide considerable reassurance, as Holder's tenure in office emphatically did not, that the powers of law enforcement were not being abused in service of partisan ends. In an age of all-encompassing criminal laws, and pervasive government spying, that's a big deal.

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September 30, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Monday, September 29, 2014

Barry Presents The Foreign Tax Credit and the Limits of Substance Today at Loyola-L.A.

BarryJordan Barry (San Diego) presents The Foreign Tax Credit and the Limits of Substance at Loyola-L.A. today as part of its Tax Policy Colloquium Series:

The foreign income tax credit is a major component of U.S. economic policy and a key provision of the U.S. tax code. Accordingly, when the Supreme Court took up PPL v. Commissioner, which turned on whether a particular tax qualified for the foreign income tax credit, economists and tax experts nationwide paid close attention. Because the Supreme Court decides foreign income tax credit cases so rarely, the Court’s reasoning in PPL will likely influence courts’ thinking—and taxpayers’ pocketbooks—for many years to come. Unfortunately, the Court’s decision in PPL does little to clarify the law and guide taxpayers. Instead, it reveals the fundamentally arbitrary nature of the foreign income tax credit.

The Court justifies its ruling as a triumph of substance over form. But the Court’s opinion itself demonstrates how two taxes can be the same in substance, yet be treated quite differently for purposes of the foreign income tax credit. The Court describes a specific hypothetical tax that would not be creditable—yet there are multiple taxes that are substantively identical to the Court’s hypothetical tax, but qualify for significant foreign income tax credits.

This Article explores these conceptual problems with the foreign income tax credit, as demonstrated by PPL, and suggests several steps that Congress and the IRS might wish to take to ameliorate these problems.

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September 29, 2014 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

How to Build a Better Law Professor

National Law Journal Special Report, How to Build a Better Law Professor:

Book 2A good legal education offers more than an understanding of case law — it provides students with the real-world skills they need to succeed, an appreciation for the role of attorneys in society and the confidence to pursue their career goals. In this special report, we look at a new book [What the Best Law Professors Do (Harvard University Press, 2013)] that identifies the top law teachers in the country and spotlight how some of those honorees approach teaching.

Patti Alleva (North Dakota)
Rory Bahadur (Washburn)
Cary Bricker (McGeorge)
Roberto Corrada (Denver)
Bridget Crawford (Pace)

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September 29, 2014 in Book Club, Legal Education | Permalink | Comments (0)

WSJ: Fed Questions Banks' Use of 'Dividend Arbitrage' to Cut Hedge Funds' Tax Bills

Wall Street Journal:  Fed Questions Bank Maneuver to Reduce Hedge Funds' Dividend Taxes; 'Dividend Arbitrage' Helps Big Banks Generate More Than $1 Billion in Revenue, Draws Criticism, by Jenny Strasburg:

Large banks generate more than $1 billion a year in revenue by helping hedge funds and other clients reduce taxes through a complicated trading strategy that has drawn criticism from U.S. authorities.

Known as "dividend arbitrage," the strategy is run largely from London, where the banks temporarily transfer ownership of a client's shares to a lower-tax jurisdiction around the time when the client expects to collect a dividend on those shares, according to people familiar with the matter.

The maneuver typically enables bank clients to reduce taxes from as much as 30% of the dividend payment to 10% or so—and sometimes to zero. The savings are divided between the client, bank and entities that take ownership of the shares. The business largely involves tsocks listed in Europe and Asia.

WSJ

Banks and hedge funds say dividend arbitrage is an attractive, legal way to shrink tax bills through the differences in withholding rates around the world. ... But Bank of America recently was questioned by U.S. regulators about potential legal and reputational risks from the maneuver, according to a spokesman for the Federal Reserve Bank of Richmond. ...

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September 29, 2014 in Tax | Permalink | Comments (0)

Deep Rift Exposed as SUNY-Buffalo Dean Resigns; Faculty Foes Allege Perjury, Mismanagement of Law School

MutuaFollowing up on my previous posts:

Buffalo News, Deep Rift Exposed as UB Law’s Dean Resigns; Faculty Foes Allege Perjury, Mismanagement of School:

Behind the scenes at one of Buffalo’s oldest and most important legal institutions, there is a growing rift, an internal family feud fueled by allegations of perjury against its leader, a near vote of no confidence and an internal review that paints a portrait of a deeply divided institution.

At the center of the storm is Makau Mutua, a Harvard Law graduate, an internationally known human rights activist, and the dean of the University at Buffalo Law School. Mutua suddenly gave up that position Monday in the wake of criticism over his leadership, and he will step down in December to return as a faculty member.

Mutua’s seven years as dean appear to have divided the law school, pitting a man known across the world for human rights activism against many of the school’s most distinguished faculty members.

“It’s very toxic. It’s very sad,” one faculty member said of the environment at the law school. “We have a community that feels alienated by the administration and distanced from the school.”

The dean’s critics, and they are numerous, include some of the school’s most highly regarded faculty members.

They claim Mutua’s management style divided the school at a time of great economic turmoil. Applications and enrollment at UB Law, like at most law schools across the country, are down dramatically, and the school is going through a downsizing of both faculty and students.

Critics say Mutua, who came from within the ranks of the faculty, arrived in the dean’s office with a “divide and rule” philosophy that placed a priority on loyalty and penalized critics while rewarding allies.

But many alumni and donors view his stewardship as a much-needed step forward.

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September 29, 2014 in Legal Education | Permalink | Comments (0)

Graetz: The Bipartisan 'Inversion' Evasion: Meaningful Tax Reform Requires a Different President and a Different Congress

Wall Street Journal op-ed:  The Bipartisan 'Inversion' Evasion: Neither the White House Nor Congress Seems Interested in Tax Reform That Would Make Companies Want to Stay Here, by Michael J. Graetz (Columbia):

Tennessee Williams was famous for concocting American dramas where something is terribly wrong but no one is willing to talk about the underlying problem. That is exactly where we are now with the Obama administration's attack on "corporate inversions"—transactions where a U.S. company merges with a foreign company and locates the parent company abroad to reduce taxes.

This week Treasury Secretary Jack Lew announced new regulations that "will significantly diminish the ability of inverted companies to escape U.S. taxation." For some U.S. companies considering inversion, he said, the new measures will mean inverting will "no longer make economic sense." He admitted, however, that Treasury's moves are just a stopgap measure until Congress enacts corporate tax reform.

President Obama, Mr. Lew and just about everyone in Congress agree that the laws governing corporate taxation need rewriting. Members of both parties say they support reforms that will lower the corporate tax rate—now the highest statutory rate among developed nations—and make our corporate tax system more "competitive." The president points to his Framework for Business Tax Reform, announced in February 2012. Republicans take their cues from a comprehensive tax-reform plan issued in February by outgoing House Ways and Means Committee Chairman Dave Camp. Mr. Obama's plan would lower the corporate tax rate to 28% from 35%. Mr. Camp's plan would lower it to 25%. Both would impose a "minimum" tax rate of around 15% on the foreign earnings of a U.S. multinational corporation.

The Treasury's new regulations are aimed at hindering inverted companies' ability to bring cash back to the U.S. free of corporate taxes. And they would require the new foreign parent to be engaged in real business activities. But the new regulations do not address one of the advantages of inversion—the inverted companies' ability to use debt from their foreign parent to increase interest deductions as a way to strip earnings out of the U.S. ...

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September 29, 2014 in Congressional News, Tax | Permalink | Comments (0)

Symposium on Tax System Complexity Today in Italy

MonashMonash University hosts a two-day symposium beginning today on Tax System Complexity in Prato, near Florence, Italy convened by Chris Evans (University of New South Wales, Australia) and Rick Krever (Monash University. The symposium proceedings will be published by Kluwer in early 2015 in a book edited by Professors Evans and Krever. Speakers include Joel Slemrod (Michigan), Judith Freedman (Oxford), Alex Raskolnikov (Columbia), Philip Baker (London), Francois Vaillancourt (Montreal), Sharon Smulders (Pretoria), Kristin Hickman (Minnesota), John Hasseldine (New Hampshire), Michael Walpole (UNSW Australia), Lynne Oats (Exeter), Pasquale Pistone (Vienna), Cliff Fleming (Brigham Young) and David Ulph (Edinburgh).

 There are three broad themes within which papers will be situated:

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September 29, 2014 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Penalty for Opting Out of the Affordable Care Act Is Large ($12,240) and Growing

Wall Street Journal Tax Report:  Penalty for Not Having Health Coverage Can Be Thousands of Dollars; The ACA Penalty Can Top $12,000 for a High-Income Family of Five, by Laura Saunders:

ObamaCareIf you're opting out of the health-care coverage required by the Affordable Care Act, make sure you understand how much you'll owe Uncle Sam as a result.

For a family of five, the penalty could be as high as $12,240 for the 2014 tax year, experts say. And for many people, the penalty will rise sharply in 2015 and 2016.

The massive health-care changes passed in 2010 are phasing in, and this is the first year most Americans must have approved health insurance. Those who don't will owe a penalty under the Individual Shared Responsibility Provision. It's due with your income taxes, payable by April 15, 2015.

While most people will probably obtain qualified health coverage through an employer or an exchange, there will be others who owe the penalty. Eddie Adkins, a health-care and benefits specialist at Grant Thornton in Washington, says this group will likely include affluent and wealthy people who want to self-insure or use a so-called nonconforming policy that doesn't meet Affordable Care Act standards.

Then there are the "young invincibles": healthy young adults, typically in their late 20s or early 30s, who will get little or no tax credit to reduce their premiums. Many would rather spend the cost of health coverage, which can run from several hundred to several thousand dollars a year, on something else, such as paying off college loans.

For those who are thinking of opting out, here's what you need to know.

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September 29, 2014 in IRS News, Tax | Permalink | Comments (3)

Should Law Schools Adopt the Montessori Method?

Emily Grant (Washburn), The Pink Tower Meets the Ivory Tower: Adapting Montessori Teaching Methods for Law School, 66 Ark. L. Rev. ___ (2014):

MontessoriSome principles of teaching are timeless. Maria Montessori developed a methodology for teaching children over 100 years ago, nearly the same time Christopher Columbus Langdell was adapting the Socratic Method for teaching law students. Law school professors can incorporate Montessori’s ideas to foster a more robust educational environment for law students as they join a profession of life-long self-directed learners.

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September 29, 2014 in Legal Education, Scholarship, Teaching | Permalink | Comments (2)

The IRS Scandal, Day 508

IRS Logo 2New York Observer:  Eric Holder Runs from a Ticking Time Bomb: IRS Deadline Approaches Fast, Federal Judges are Furious—and Where’s Andrew Selka?, by Sidney Powell:

The surprise resignation of Eric Holder, the first Attorney General ever to be held in contempt of Congress, exploded in the news today. Holder has been under unrelenting assault for the most egregious politicization and abuse of power in the Department of Justice in history—exceeding that of John Mitchell and Alberto Gonzalez. He has made the Department of Obstructing Justice notorious. Federal judges are stepping in to end his stone walling of Congressional and other investigations on several fronts, and now he’s on the run.

Why now? What is about to blow up? ...

Mr. Holder is about to run out of stalling time on the cover-up in the IRS scandal. He has come under increasingly serious fire for refusing to appoint a real special prosecutor to investigate what the Inspector General of the Treasury has already determined to be improper targeting of conservative groups by IRS officials including Lois Lerner. That bomb could detonate any day now.

The IRS has stonewalled production of the relevant documents, suffered astonishing computer crashes, deliberately destroyed Lois Lerner’s Blackberry with no effort to retrieve the “missing” emails from it, and been deceitful and obstructionist in the lawsuit brought by Judicial Watch to obtain documents that would reveal the target selection process and how high up in the White House the knowledge or direction of it can be traced.

Judicial Watch recently requested additional discovery. Judge Emmet Sullivan, the federal judge in the District of Columbia, has just given the IRS until October 17 to file its response to that motion. Judge Sullivan has the power to appoint—and has previously—appointed a special prosecutor to investigate the Department of Justice. ...

Mr. Holder tasked Barbara Bosserman, a Civil Rights Division attorney, with the Department’s own purported investigation of the IRS abuses. Congress later learned that she had made substantial contributions to the President’s campaign and renewed its demand for Mr. Holder to name a special prosecutor.

As more of the IRS emails have come to light, they have revealed that Mr. Holder allowed a Justice Department lawyer, Andrew Strelka, to represent the IRS in opposing the lawsuit by Z Street—a group allegedly targeted for abusive treatment by the IRS because of its support for Israel. Mr. Strelka used to work with Lois Lerner, engaged in the political targeting himself, and maintained his close relationship with Ms. Lerner after he joined the Justice Department. Congressmen Issa’s and Jordan’s letter of August 25 to the Attorney General revealed that Mr. Strelka was privy to internal communications of the Exempt Office of the IRS long after he left that office. He was even advised immediately of the crash of Ms. Lerner’s hard drive—unlike Congress or any federal judge.

The letter notes: “Curiously, before his withdrawal from the case [forced by a story reporting this conflict], Strelka also completed a detail to the White House Counsel’s Office from December 2013 to June 2014—during which time the White House learned of Lois Lerner’s destroyed emails.”

The Congressional Committee on Government Oversight and Reform has intensified its inquiry into the Department’s conduct. The Congressmen told the Attorney General that their Committee staff should be contacted to arrange transcribed interviews of Mr. Strelka and Ms. Siegel by September 8. Mr. Strelka quickly and quietly left the Department. By September 5, the Department was stonewalling and refusing to assist the Committee in locating Mr. Strelka—who seems to be as missing as the IRS emails. As the Hill has reported, Rep. Jordan complains that the Justice Department “has declined to give Strelka’s contact information to the Oversight Committee and has reprimanded the panel for trying to get in touch with him directly.” Is this an out-take from House of Cards?

Congress also wants to talk to Nicole Siegel, a Department lawyer in the Office of Legislative Affairs. Turns out she also worked for Lois Lerner, shared Ms. Lerner’s views, and kept in touch. Hardly the disinterested person one should have in the Department office that responds to congressional inquiries on the IRS’s target selection.

Then there was the extraordinary accidental or mistaken call to Congressman Issa’s office by the Justice Department’s Office of Public Affairs. The call was intended for Rep. Elijah Cummings, the ranking minority member of the Oversight Committee, and sought to coordinate a leak of selected Committee documents to selected reporters so the Department could comment on them. The subject of the conversation and documents? None other than Andrew Strelka—regarding his representation of IRS Commissioner Koskinen in the Z-Street case. Meanwhile, other emails reveal extensive communications between Rep. Cummings’ staff and the IRS — referred to as an “executive branch agency” — in 2012 and 2013 regarding conservative group True the Vote.

As of September 12, the Department was still obstructing efforts to locate Mr. Strelka. Meanwhile, the Department’s own Inspector General Michael Horowitz testified before the House Judiciary Committee that the FBI and other components of the Department of Justice “have refused our requests for various types of documents. As a result, a number of our reviews have been significantly impeded.” Mr. Horwitz had already joined an unprecedented letter signed by 47 Inspector Generals for various agencies expressing serious concern that their jobs were being undermined and obstructed by multiple agencies of this presidency, including the Department of Justice.

Mr. Strelka can’t hide forever. Judge Bates is fed up with Department’s delays and ordered the list of documents Mr. Holder and Mr. Obama have been hiding for years now on their Fast and Furious scheme. Soon, Judge Sullivan could appoint a special prosecutor or demand production of the back-up server’s emails, or give Judicial Watch additional discovery after October 17.

One thing is for certain. Mr. Holder didn’t just wake up today and decide he wanted to go fishing. There are truths underlying this resignation that will be shocking when they surface. Mr. Holder will no longer have the shield of the Attorney General and the Department of Justice to protect him from congressional, grand jury, or other subpoenas. The next question is: Which criminal lawyer will he hire to defend him and how soon?

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September 29, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

TaxProf Blog Weekend Roundup

Sunday, September 28, 2014

Income Gains in the Obama Economic Recovery: +116% to Top 10%, -16% to Bottom 90%

New York Times:  The Benefits of Economic Expansions Are Increasingly Going to the Richest Americans, by Neil Irwin:

Economic expansions are supposed to be the good times, the periods in which incomes and living standards improve. And that’s still true, at least for some of us.

But who benefits from rising incomes in an expansion has changed drastically over the last 60 years. Pavlina R. Tcherneva, an economist at Bard College, created a chart that vividly shows how.

Income Growth

The Rich Are Getting Richer, Part the Millionth, by Kevin Drum:

It's a pretty stunning chart. The precise numbers (from Piketty and Saez) can always be argued with, but the basic trend is hard to deny. After the end of each recession, the well-off have pocketed an ever greater share of the income growth from the subsequent expansion. Unsurprisingly, there's an especially big bump after 1975, but this is basically a secular trend that's been showing a steady rise toward nosebleed territory for more than half a century. Welcome to the 21st century.

September 28, 2014 in Tax | Permalink | Comments (3)

Cass Sunstein's Ode to the Independent Bookstore: 'Church, House of Worship, Sacred Place'

Seminary

Chicago Tribune:  A Treasure-Trove Beyond Words, by Cass Sunstein (Harvard):

I joined the faculty of the University of Chicago Law School in 1981. On the day after I moved to Hyde Park, a young English professor told me, in hushed tones, "The best thing about the University of Chicago is the Sem Co-op." He added, as if he were discussing a legendary priest, or a world leader, or perhaps a spy, "It's run by Jack Cella."

Of course I had no idea what a "Sem Co-op" might be, and I had never heard of Jack Cella — and I was properly intimidated by both. A week later, I discovered the Seminary Co-op Bookstore, and I was able to see, at his small desk on the right as you enter the store, the famous Jack Cella.

Hyde Park's Seminary Co-op Bookstore is not merely a bookstore. It is a community. It is a small town. It is a church, a sacred place. The air is cleaner there, and the people are more gracious, and they move more slowly. It is defined by quiet, and by gentleness, and by respect. No one disturbs anyone there. When they talk, they tend to whisper.

A confession: During my first years at the University of Chicago, I was a bit frightened whenever I entered the Seminary Co-op. I met Jack, or sort of met Jack, but I didn't know if he knew my name. When I saw him, I felt painfully shy. You could find the university's legendary professors there — the people who wrote the books that made it onto the celebrated Front Table (more on that in a minute). Wayne Booth might be there, or Marshall Sahlins, or Wendy Doniger, or David Tracy, or William Julius Wilson, or Gary Becker. (Would one say, "hello, Professor Becker"? "Hi there, Gary?" Nothing at all?)

The Seminary Co-op was a magnet. It was analogous to a great city as memorably described by Jane Jacobs: It was full of life-altering surprises, and unknown treasures, and whenever you turned a corner, you never knew what you would see. ...

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September 28, 2014 in Legal Education, Tax | Permalink | Comments (0)

Top 5 Tax Paper Downloads

SSRN LogoThere is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads on SSRN, with a new paper debuting on the list at #5.  The #1 paper is now #19 in all-time downloads among 10,329 tax papers:

  1. [3172 Downloads]  'Competitiveness' Has Nothing to Do with it, by Edward D. Kleinbard (USC)
  2. [333 Downloads]  2013 Developments in Connecticut Estate and Probate Law, by Jeffrey A. Cooper (Quinnipiac) & John R. Ivimey (Reid and Riege, Hartford)
  3. [252 Downloads]  Public Pressure and Corporate Tax Behavior, by Scott Dyreng (Duke), Jeffrey Hoopes (Ohio State) & Jaron Wilde (Iowa)
  4. [185 Downloads]  The OECD'S Flawed and Dated Approach to Computer Servers Creating Permanent Establishments, by Monica Gianni (Florida)
  5. [121 Downloads]  Rights Without Remedies, by Matthew L. M. Fletcher (Michigan State)

September 28, 2014 in Tax, Top 5 Downloads | Permalink | Comments (0)

The IRS Scandal, Day 507

IRS Logo 2The Daily Signal:  Eric Holder’s 7 Worst Actions as Attorney General:

3. Failure to conduct a real, criminal investigation of the IRS targeting of conservative organizations and to enforce the contempt citation issued by the House of Representative against Lois Lerner.

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September 28, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Saturday, September 27, 2014

6th Annual Aspiring Law Profs Conference Today at Arizona State

Aspiring Law Profs 2Arizona State hosts the 6th Annual Aspiring Law Professors Conference today on Saturday, September 27 (details here):

  • Learn to succeed in the entry-level law teaching market
  • Obtain an insiders perspective on the appointments process from faculty with extensive hiring experience
  • Participate in a mock interview or mock job talk and gain feedback from law professors

I will be delivering the keynote address on Law School Rankings, Faculty Scholarship, and the Missing Ingredient. Previous keynote speakers were Brian Leiter (2009), Dan Filler (2010), Eugene Volokh (2011), Paul Horwitz (2012), and Christine Hurt (2013).

Update:  PrawfsBlawg:  ASU Aspiring Law Professors Conference, by Richard Chen (Pepperdine VAP)

September 27, 2014 in Conferences | Permalink | Comments (0)

NY Times: Profits Made in the USA, but Banked Overseas

New York Times:  Made in the U.S.A., but Banked Overseas, by Floyd Norris:

MadeImagine how frustrating it would be to have billions of dollars in cash but be unable to spend it as you wish unless you paid a large part to the Internal Revenue Service.

That could be your problem if you were running a large multinational corporation based in the United States.

Profitable companies that operate only in this country have some tax breaks available and so often pay considerably less than the statutory corporate tax rate of 35 percent. But they still face a significant tax bill.

It is a different story for United States companies that operate internationally.

“U.S. multinational firms have established themselves as world leaders in global tax avoidance strategies,” said Edward D. Kleinbard, a former chief of staff of Congress’s Joint Committee on Taxation who now teaches tax law at the Gould School of Law at the University of Southern California. In a recent article, he sarcastically added that those companies “are burdened by tax rates that are the envy of their international peers.”

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September 27, 2014 in Tax | Permalink | Comments (0)

Morgan Stanley on Income and Wealth Inequality

Morgan Stanley LogoWall Street Journal, Why Wall Street Cares About Inequality:

First, it was Standard & Poor’s. Now, Morgan Stanley weighs in on income inequality in a new report. Why are these Wall Street institutions, normally focused on macroeconomic issues directly related to gross domestic product forecasts, suddenly chiming in on the issue?

Morgan Stanley

Morgan Stanley 2

(Hat Tip: Bruce Bartlett.)

September 27, 2014 in Tax | Permalink | Comments (0)

The IRS Scandal, Day 506

Friday, September 26, 2014

Shay Presents Tax Inversions -- The Problem and Possible Solutions Today at San Diego

Shay (2014)Stephen E. Shay (Harvard) presents Mr. Secretary, Take the Tax Juice Out of Corporate Expatriations, 144 Tax Notes 473 (July 28, 2014), at San Diego today as part of its Tax Law Speaker Series:

This article describes the principal tax benefits companies seek from expatriating and outlines regulatory actions that can be taken without legislative action to materially reduce the tax incentive to expatriate. These proposals for regulations are supported by existing statutory authority. They would be good policy and consistent with, or easily integrated with, publicly proposed tax reform proposals.

Prior TaxProf Blog coverage:

September 26, 2014 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Blair-Stanek Presents Crisis-Proofing Tax Law Today at Michigan State

Blair-Stanek (2013)Andrew Blair-Stanek (Maryland) presents Crisis-Proofing Tax Law at Michigan State today as part of its Junior Faculty Workshop:

Tax law should borrow from tort law’s doctrine of necessity to respond better to future financial crises. Tort law gives dock owners a “property rule” right to exclude unwanted boats. But when storms arise, dock owners are protected by only a “liability rule”: they cannot exclude an unwanted boat, but the boat’s owner must compensate the dock owner. This rule creates optimal incentives to minimize storm damage, while also preventing windfalls to boat owners.

Tax law also has both property rules and liability rules. When a taxpayer violates a tax-law requirement, the result is either additional tax proportionate to the harm (a liability rule) or a draconian penalty such as losing a favorable tax status entirely (a property rule).

During the 2008-09 financial crisis, a number of financially-distressed taxpayers found themselves unable to meet tax-law requirements protected by property rules. Failing these requirements would have pushed the taxpayers into financial death spirals. Several of the IRS’s ad hoc responses to the crisis unwittingly borrowed from tort law’s doctrine of necessity, moving from a draconian property rule to a proportional liability rule to prevent tax law from worsening the taxpayer’s situation. But other IRS responses simply moved from property rules to non-enforcement, resulting in large windfalls to some taxpayers, to the Treasury’s detriment. Counterintuitively, because non-enforcement created such windfalls, the IRS kept such responses so narrowly tailored that many taxpayers got no relief at all.

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September 26, 2014 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Weekly Tax Roundup

September 26, 2014 in Tax, Weekly Tax Roundup | Permalink | Comments (0)

Weekly Legal Education Roundup

September 26, 2014 in Legal Education, Weekly Legal Education Roundup | Permalink | Comments (0)

Weekly SSRN Tax Roundup

September 26, 2014 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Call For Tax Papers: Summer 2015 SEALS Annual Conference

SEALs Logo (2013)Jennifer Bird-Pollan (Kentucky) has issued a call for tax papers for the 2015 SEALS Annual Conference to be held July 27 - August 2 in Boca Raton, Florida:

Although summer 2015 seems miles away, it is already time to submit proposals for the next SEALS conference, to be held July 27 - August 2, 2015. As I have done in years past, I am happy to organize and submit for consideration panels and discussion sessions on tax topics. For the past several years we have had successful Tax Policy Discussion groups, consisting of 10 to 12 tax scholars presenting for only 5 to 10 minutes each, but then participating as a group in a larger discussion of issues in tax policy, broadly defined. In addition, there have been several tax panels each year, consisting of 4 to 5 panelists discussing a more narrow tax topic. If you are interested in participating in a Tax Policy Discussion Group, or if you have a paper you’d like to present as part of a panel, but are looking for others to join with you, please let me know. Proposals are due at the end of October, so if you could let me know of your potential interest by Friday, October 10, that would be great.

September 26, 2014 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Nine Law Schools Offer Online Tax LL.M. Degrees

National JuristAccording to the National Jurist and other sources, nine law schools now offer an online Tax LL.M. degree:

September 26, 2014 in Legal Education, Tax | Permalink | Comments (0)

The U.S. News Law School Rankings and the Rise of Transfer Students

Bruce M. Price (San Francisco) & Sara Star (Miller Starr Regalia, Walnut Creek CA), The Elephant in the Admissions Office: The Influence of U.S. News & World Report on the Rise of Transfer Students in Law Schools and a Modest Proposal for Reform, 49 U.S.F.L. Rev. ___ (2014):

U.S. News (2015)Students who perform well after the first year of law school are increasingly transferring to schools ranked higher by U.S. News to maximize their chances of getting a law firm job immediately following graduation. This phenomena raises two fundamental and understudied issues: how students make the decision to seek to transfer to a higher-ranked and higher-tier law school, and why such law schools are willing to admit transfer students into their second-year class who they were not willing to admit initially. The first issue we explore through interviews with students who transferred as well as those who could have transferred but chose not to. The second issue we explore by highlighting the persuasiveness of U.S. News as a determinant of law school status and the ways in which the magazine has spawned the growth and development of law school competition for transfer students. We conclude that the scale and magnitude of the phenomenon of transfer students is affecting significantly the practices and procedures of all law schools, and that this phenomenon is driven by U.S. News’s failure to account for the LSAT scores and UGPAs of students that both transfer into and out of law schools when determining rankings. We conclude with a modest proposal that the ABA and U.S. News should require law schools to provide the metrics of incoming transfer students and exclude the metrics of departed transfer students.

September 26, 2014 in Law School Rankings, Legal Education | Permalink | Comments (3)

Why is Thomas Piketty's 700-Page Book a Bestseller?

PikettyThe Guardian, Why is Thomas Piketty's 700-Page Book a Bestseller?:

Thomas Piketty is a French economist whose Capital in the Twenty-First Century has swept American discourse. Four experts – Brad DeLong, Tyler Cowen, Stephanie Kelton and Emanuel Derman – take on why that is.

There’s been a bizarre phenomenon this year: a young, little-known French economist has written a 700-page tome about economic inequality – dense with data, historical examples from France, and a few literary references to Jane Austen.

That’s not the strange part. This is: it’s a bestseller.

Somehow, Capital in the Twenty-First Century by Thomas Piketty has become a conversation piece among well-read people. Its graphic red-and-ivory cover is inescapable. Early in its launch, it hit No 1 on Amazon’s bestseller list and the paper version – a doorstop in punishing, heavy hardcover – sold out in major bookstores.

Piketty’s main argument is this: that invested capital – in the stock market, in real estate – will grow faster than income.

The implications of that are deep: to have invested capital, you must have money already. If you rely on income, as most people do, you will likely never catch up to the wealth of people who are already rich. The 1% and the 99% enshrined by Occupy are not an anomaly of our time, Piketty’s research suggests. It’s a structural feature of capitalism. Piketty’s work – which has been in progress for over a decade – is a natural pairing with the Occupy movement, which also questions the premises of capitalism.

You can see the appeal of such an argument, which has driven the book to become a cultural touchpoint. Seattle quoted Piketty in its minimum-wage law. The book has had so many reviews and articles that it’s possible for someone to feel as if they have read it even without cracking the cover.

Which raises the question: why this book? The themes that Piketty brings up have been enshrined in discussion about progressive economists for decades. No fewer than three Nobel Prize winners – Joseph Stiglitz, Paul Krugman and Robert Solow – have all devoted much of their careers to studying inequality. On Friday, 19 September, I moderated a panel at the Washington Center for Equitable Growth that included Solow as well as economists Brad DeLong, Tyler Cowen and Russ Roberts. For 90 minutes, they hammered out the implications of Piketty’s work -- and the discussion ended with much more to say.

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September 26, 2014 in Book Club, Tax | Permalink | Comments (3)

The IRS Scandal, Day 505

IRS Logo 2Washington Free Beacon:  Politico's Epic Fail in Their Lois Lerner Interview, by Larry O'Connor:

Unrepentant political hack Lois Lerner finally broke her 16-month silence by granting Politico an exclusive interview Monday. She was flanked by not one, but two lawyers running interference for any challenging questions from reporter Rachael Bade.

However, if Politico had been more diligent in approaching their “big get” with a reporter who was well versed in the charges against Lerner and the conflicting narratives that have been floated by the IRS, Department of Justice, and the administration since May 2013, they would have had a fantastic interview with a plethora of challenging moments that might have ended with Lerner’s lawyers shutting down the interview before it could end.

Instead, Lerner had the opportunity to tell her story without the benefit of a real challenge on the facts of the case and how they conflict with the carefully crafted narrative told to Ms. Bade during the headline-grabbing exclusive.

Probably the most glaring example of Politico letting Lerner lie about her involvement in the IRS scandal and the subsequent cover-up comes in one of Lerner’s rhetorical tricks involving the mysteriously crashed hard-drives that contained emails related to the scandal.

Lerner is allowed to pose a rhetorical question that Ms. Bade (and apparently her editors at Politico) cannot or refuse to answer for their readers:

“How would I know two years ahead of time that it would be important for me to destroy emails, and if I did know that, why wouldn’t I have destroyed the other ones they keep releasing?”

We, the reader, never hear Ms. Bade’s answer and her editors never research the issue in any real way to inform us of the facts behind Lerner’s supposed “gotcha” moment.

The truth is divulged in a Wall Street Journal analysis of evidence uncovered via a congressional investigation, not a puff piece bit of rah-rah “journalism.” (emphasis mine)

As to Ms. Lerner’s behavior, consider that House Ways & Means Chairman Dave Camp first sent a letter asking if the IRS was engaged in targeting in June, 2011. Ms. Lerner denied it. She engineered a plant in an audience at a tax conference in May 2013 to drop the bombshell news about targeting (maybe hoping nobody would notice?). She has subsequently asserted a Fifth Amendment right to silence in front of the only people actually investigating the affair, Congress. Now we learn that her hard drive supposedly defied modernity and suffered total annihilation about 10 days after the Camp letter arrived.

The answer to Lerner’s suggestion is pretty simple. “Ms. Lerner, there is a letter from Chairman Camp asking you about the tea party group targeting in June of 2011. Your hard drives ‘crashed’ ten days after you received that letter. Why are you pretending you didn’t learn about the targeting until 2013”

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September 26, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Thursday, September 25, 2014

Columbia Journal of Tax Law Publishes New Issue

Columbia Journal of Tax Law LogoThe Columbia Journal of Tax Law has published  Vol. 5, No. 2:

September 25, 2014 in Scholarship, Tax | Permalink | Comments (0)