TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Friday, March 24, 2017

Weekly SSRN Tax Article Review And Roundup

This week, Daniel Hemel (Chicago) reviews a new paper by Wei Cui (University of British Columbia), Taxation Without Information: The Institutional Foundations of Modern Tax Collection.

HemelWei Cui’s new paper, Taxation Without Information: The Institutional Foundations of Modern Tax Collection, challenges the now-conventional wisdom that the effective tax collection depends upon third party reporting. Cui suggests that effective tax collection in fact depends upon the existence of business firms for whom compliance with the law—tax as well as non-tax—is the norm. Cui argues that this insight should lead us to rethink our assumptions not only about modern tax collection, but also about modern business firms: “we should stop thinking of business firms as ‘fiscal intermediaries,’” Cui writes, and instead “conceive of firms as sites of social cooperation under the rule of law” (p. 3).

Cui’s paper is ambitious, important, and—I think—largely right. He has persuaded me that third party reporting is not nearly as integral to tax collection as I previously believed. If there is a weak point in his argument, it is this: the evidence he produces in support of his “social cooperation” theory is equally consistent with the claim that business firms facilitate legal compliance precisely because they fail to engender close cooperation among their members.

Continue reading

March 24, 2017 in Scholarship, Tax | Permalink | Comments (0)

Tax Policy In The Trump Administration

Weekly Legal Education Roundup

Ousted Cincinnati Law School Dean Is Exploring Her Legal Options

UC BardFollowing up on my previous posts (links below):  Cincinnati Enquirer, UC Law School Dean Out For Now, Exploring Legal Options:

The dean of University of Cincinnati's College of Law, Jennifer Bard, was placed on administrative leave Wednesday. Interim provost Peter Landgren made the announcement in an email Wednesday to the law school community. ...

Bard, who joined UC as dean in July 2015, said in a statement she was "surprised at the precipitous action the University took so soon after this matter became public and revealed the deep divisions within the Law School Community and tensions over the use of the school's resources."

Under Bard's leadership, applications grew, more students passed the bar, the school’s national reputation improved, the Board of Trustees approved a new building and fundraising increased, according to Bard.

Bard said she was recruited to reduce a "significant financial deficit" and "establish sound financial controls," which she has made significant progress in doing.

She said Landgren's action raises serious questions about UC's failure to support the financial goals for which she was hired and the due process to which she is entitled. Bard's legal counsel is currently evaluating her legal options, the statement said.

Continue reading

March 24, 2017 in Legal Education | Permalink | Comments (0)

Tulane Hosts 7th Annual Tax Roundtable

Tulane (2015)7th Annual Tulane Tax Roundtable:

Lily Batchelder (NYU)
Accounting for Behavioral Considerations in Business Tax Reform: The Case of Expensing
Discussant:  Steve Sheffrin (Tulane)

Daniel Hemel (Chicago)
The Federalist Safeguards of Progressive Taxation
Discussant:  Lily Faulhaber (Georgetown)

Continue reading

March 24, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (0)

University of Minnesota Law Professor Charged In Multi-Million Dollar Corporate Fraud Scheme

AdamsEdward Adams, Howard E. Buhse Professor of Finance and Law at the University of Minnesota Law School, has been indicted for stealing $4.4 million from investors and paying $2.5 million to his own law firm.

Continue reading

March 24, 2017 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 1416:  ‘Media Attention’ And IRS Abuse

IRS Logo 2

Wall Street Journal op-ed: ‘Media Attention’ and IRS Abuse: A Simple Rule Fix Could End Partisan Targeting Tomorrow, by John J. (President & CEO, Cause of Action Institute):

The Internal Revenue Service’s targeting of Americans for their political views may have ended with the Obama administration — or even with its exposure in 2013. But it could easily recur. Even now, an internal IRS rule singles out applicants for nonprofit status who might be tied to anything newsworthy.

The genesis of the targeting scandal was Section 7.29.3 of the Internal Revenue Manual. As noted in a report my organization is issuing Wednesday, this manual dictates how IRS employees handle everything from customer service to criminal investigations. This particular section tells them to flag for further review any application for tax-exempt status that might “attract media or Congressional attention.”

That’s a broad, vague and subjective command that career IRS employees are nevertheless required to follow. Emails between IRS personnel make clear that low-level employees were guided by this rule throughout the targeting scandal. They repeatedly cited “media attention” on the Tea Party as the reason to single out and delay applications from conservative groups.

This rule means that IRS enforcement reflects the ideological biases of the media. Aside from a small number of groups related to the Occupy Wall Street movement and the defunct advocacy group Acorn, libertarian and free-market groups were almost exclusively targeted.

These provisions of the IRS manual have nothing to do with the merits of a nonprofit application and everything to do with keeping the agency from looking bad. It is inappropriate for a group’s tax-exempt status to be deep-sixed because of negative publicity. In the targeting scandal, this approach allowed partisan concerns to overtake the application process, resulting in the unfair treatment of political viewpoints at odds with the Obama administration.

Equal justice under the law demands that the IRS abandon the “newsworthy” criterion. To date, however, the agency has promised only to stop making lists of targeted groups “until further notice.” Even if the halt were permanent, it wouldn’t be enough. IRS officials are still required to follow the manual and pull high-profile applications for enhanced scrutiny.

Continue reading

March 24, 2017 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Thursday, March 23, 2017

Robinson Presents State Income Tax Law In The Shadow Of The Internal Revenue Code Today At Indiana

Robinson (2017)Mildred Robinson (Virginia) presents Irreconcilable Differences?: State Income Tax Law in the Shadow of the Internal Revenue Code at Indiana-Bloomington today as part of its Tax Policy Colloquium Series hosted by Leandra Lederman:

[T]his paper will proceed in four parts. Part I provides a brief history of states’ experience with taxing incomes beginning prior to the enactment of the 16th amendment to the United States constitution and ending with the present. I will touch upon early individual state efforts to tax personal incomes. A salient part of this discussion will highlight the political factors likely to have contributed to states’ decisions to conform to (and not piggy-back onto) the federal internal revenue code. This part will also highlight the ways in which state codes began to depart from the federal code with emphasis on those differences contributing even early on to the regressive effect captured by data currently analyzed by the Institute on Taxation and Economic Policy.

Continue reading

March 23, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Want To Buy A Law School (or Three) On The Cheap? InfiLaw May Have A Deal For You.

ACFABA Journal, Can InfiLaw Schools Be Had on the Cheap, and Would They Be Worth It?:

Sterling Partners may be unloading all three of its for-profit InfiLaw System schools, say some consultants after the announcement that Charlotte School of Law, which is currently on probation for being out of compliance with ABA accreditation standards, plans to affiliate with a nonprofit college in the Northeast. ...

Earlier this month, Arizona Summit Law School announced it will sign an affiliation agreement with Bethune-Cookman University, a historically black college in Florida. And in January, Scott DeVito, dean of Florida Coastal School of Law, told Jacksonville.com that the school hoped to join a nonprofit university. At this point, Florida Coastal is in conversations with “select universities,” DeVito told the ABA Journal Thursday, but no agreement has been reached.

Continue reading

March 23, 2017 in Legal Education | Permalink | Comments (3)

Anthony Kronman, The Sage of Yale Law School: 'A Born-Again Pagan'

PaganThe New Yorker, The Sage of Yale Law:

Anthony Kronman, age seventy-one, may be the world’s most fulfilled man. A professor at Yale Law School for thirty-eight years, he has a happy marriage and four children. He swims a mile every day and is an expert fisherman with rod and spear. He lives in an impeccably decorated house worthy of Architectural Digest. He has written six books, about law, legal ethics, and education, and, last year, published his seventh, an eleven-hundred-page exploration of his personal theology, called Confessions of a Born-Again Pagan [Yale University Press 2016]. By integrating the ideas of many of the world’s great thinkers—Aristotle, Aquinas, Augustine, Spinoza, and others—he has found “a third way, beyond atheism and religion, to the God of the modern world.” He suspects that he might have found the meaning of life.

Continue reading

March 23, 2017 in Book Club, Legal Education | Permalink | Comments (2)

Rossi:  Carbon Taxation By Regulation

Jim Rossi (Vanderbilt), Carbon Taxation by Regulation, 102 Minn. L. Rev. ___ (2018):

This Article argues that, even though a carbon tax remains politically elusive, “carbon taxation by regulation” has begun to flourish as a way of financing carbon reduction. For more than a century, energy rate setting has been used to promote public good and redistributive goals, akin to general financial taxation. Various non-tax subsidies in customer energy rates have enormous untapped potential for promoting low-carbon sources of energy, while also balancing broader economic and social welfare goals.

Continue reading

March 23, 2017 in Scholarship, Tax | Permalink | Comments (0)

Provost Removes Cincinnati Law School Dean Less Than Two Years Into Her Five-Year Term

UC BardFollowing up on my previous posts:

From: Landgren, Peter (landgrpe)
Sent: Wednesday, March 22, 2017 4:24 PM
Subject: College of Law Leadership

Dear College of Law Community,

After much deliberation and after many conversations with the dean and many of you who are part of the College of Law community, I have met with Dean Jennifer Bard today and taken steps to place her on administrative leave effective immediately.

Continue reading

March 23, 2017 in Legal Education | Permalink | Comments (5)

NPR:  Joe Bankman, Tax Hero

BankmanNPR Planet Money, Tax Hero:

Imagine if you had to pay your credit card bill the way you pay your taxes.

Each month, Visa would send you a blank form. The form would instruct you to gather all your receipts, write down every purchase you had made, and calculate the total amount you owed Visa.

Continue reading

March 23, 2017 in Tax | Permalink | Comments (4)

The Most Beautiful College In Every State

Travel+Leisure, The Most Beautiful College in Every State:

When selecting the most enchanting school in every state, we considered the setting and scenery; the design of the buildings ... ; and the upkeep of the campus grounds. And we took plenty of other details into account, too, including knowledge from campus visits, in-depth virtual tours, first-person references and word of mouth, extensive general research, and hours upon hours of examining campuses from images shot at just about every imaginable angle.

Sure, picking the most beautiful college in every state of the union isn’t an exact science. And some states have so many absurdly gorgeous schools that the final decision almost felt like a toss-up. But for travelers seeking an all-around positive experience — whether you're on a college tour with the kids or looking for a place to wander on a balmy afternoon — these scholarly institutes all get top marks for good looks.

Pepperdine

Pepperdine University in California

Continue reading

March 23, 2017 in Legal Education | Permalink | Comments (0)

Gamage & Shanske:  Why A State-Level Carbon Tax Can Include Border Adjustments

David Gamage (Indiana) and Darien Shanske (UC-Davis), Why a State-Level Carbon Tax Can Include Border Adjustments, 83 State Tax Notes 583 (Feb. 13, 2017):

This essay argues that U.S. state governments can permissibly levy state-level carbon taxes with border tax adjustments.

Continue reading

March 23, 2017 in Scholarship, Tax | Permalink | Comments (0)

Wednesday, March 22, 2017

Ring Presents Leak-Driven Law Today At Boston College

Ring (2017)Diane Ring (Boston College) presents Leak-Driven Law, 65 UCLA L. Rev. __ (forthcoming 2018) (with Shu-Yi Oei (Tulane; moving to Boston College)) at Boston College today as part of its Tax Policy Workshop Series:

Over the past decade, a number of well-publicized data leaks have revealed the secret offshore holdings of high-net-worth individuals and multinational taxpayers, leading to a sea change in cross-border tax enforcement. Spurred by leaked data, tax authorities have prosecuted offshore tax cheats, attempted to recoup lost revenues, enacted new laws, and signed international agreements that promote “sunshine” and exchange of financial information between countries.

The conventional wisdom is that data leaks enable tax authorities to detect and punish offshore tax evasion more effectively, and that leaks are therefore socially beneficial from an economic welfare perspective. This Article argues, however, that the conventional wisdom is too simplistic.

Continue reading

March 22, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Shanske Presents Equitable Apportionment And The State Corporate Income Tax Today At Duke

Shanske (2017)Darien Shanske (UC-Davis) presents Equitable Apportionment and the State Corporate Income Tax: Past, Present and Possible Future at Duke today as part of its Tax Policy Workshop Series hosted by Lawrence Zelenak:

What a tough break for formulary apportionment. We are at a moment when there is apparently a real interest in reforming the federal corporate income tax in a way that, at least in theory, would broaden the base of the tax and encourage exporters. Shifting to the use of formulary apportionment with a single sales factor (SSF) could theoretically achieve these goals and there is at least one well-developed reform proposal to that end on the table. Moreover, over 40 states impose a corporate income tax and they have used formulas for a very long time, and so there is a track record and case law to work with. But this is not — yet — formulary apportionment’s moment.

This is the moment for the Destination-Based Cash Flow Tax (DBCFT), which relies on border tax adjustments (BTAs).

Continue reading

March 22, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Yariv Brauner Named To Hugh Culverhouse Eminent Scholar Chair At Florida

BraunerYariv Brauner has been named to the Hugh Culverhouse Eminent Scholar chair at Florida:

Professor Brauner has been a member of the UF Law faculty, teaching in the Graduate Tax Program, since 2006. Prior to joining UF, he taught at the Arizona State University College of Law, Northwestern University School of Law, and New York University School of Law, from which he received both an LL.M. in International Taxation and an S.J.D. degree.

A prolific scholar focusing principally on international taxation, Professor Brauner is the author of more than 60 books and articles and has presented papers at over a hundred conferences and law schools around the world.

Continue reading

March 22, 2017 in Tax | Permalink | Comments (2)

Avi-Yonah Posts Two Tax Papers on SSRN

Reuven S. Avi-Yonah (Michigan) & Haiyan Xu (Michigan), A Global Treaty Override? The New OECD Multilateral Tax Instrument and Its Limits:

The new OECD Multilateral Instrument to amend tax treaties (MLI) is an important innovation in international law. Hitherto, international economic law was built primarily on bilateral treaties (e.g., tax treaties and BITs) or multilateral treaties (the WTO agreements). The problem is that in some areas, like tax and investment, multilateral treaties proved hard to negotiate, but only a multilateral treaty can be amended simultaneously by all its signatories.

Continue reading

March 22, 2017 in Scholarship, Tax | Permalink | Comments (0)

Cincinnati Dean Says 'Small Cabal' Of Tenured Faculty Is Seeking Her Ouster Because Of Her Attempt To Balance Law School's Budget

UC BardFollowing up on Monday's post, Cincinnati Law School Dean Under Fire From Faculty: Ouster, Vote Of No Confidence Discussed As Provost Unveils 6-Month Plan To 'Restore Mutual Trust And Respect' And Dean Lawyers Up:  Cincinnati Business Courier, UC Law Dean Responds to Call For Her Ouster:

The University of Cincinnati's College of Law dean said calls for her ouster from a "small but vocal cabal" of faculty result from steps she has taken to tackle the college's deficit.

Jennifer Bard said that in a statement in response to a March 19 Business Courier story about a group of faculty planning to take a vote of no confidence in the dean based on documents provided by the university through a public records request. The documents show that a group of at least nine law professors discussed holding a vote of no confidence in Bard as early as Nov. 22, 2016. Interim provost Peter Landgren responded by sending law school faculty a six-month plan to "restore mutual trust and respect." ...

Bard said in her statement that she was hired in 2015 "with the express written expectation that my principal responsibility was to develop and implement a plan to eliminate the very considerable financial deficit at the College of Law." ...

Bard said she has made significant progress in cutting the deficit but that rankled a small group of faculty.

Continue reading

March 22, 2017 in Legal Education | Permalink | Comments (7)

Schmalbeck, Soled & Thomas:  The Case For A Carryover Tax Basis Regime

Richard Schmalbeck (Duke), Jay A. Soled (Rutgers) & Kathleen DeLaney Thomas (North Carolina), Advocating A Carryover Tax Basis Regime (At Least for Now), 92 Notre Dame L. Rev. ___ (2017):

For close to a century, an important (but unfortunate) feature of the Internal Revenue Code has been a rule that the tax basis of any asset is made equal to its fair market value at death. Notwithstanding the substantial revenue losses associated with this rule, Congress has retained it for reasons of administrative convenience.

Continue reading

March 22, 2017 in Scholarship, Tax | Permalink | Comments (6)

NY Times:  Sorry, A Robot Is Not About To Replace Your Lawyer

Robot Lawyer 2Following up on my previous posts:

New York Times, Sorry, a Robot Is Not About to Replace Your Lawyer:

Impressive advances in artificial intelligence technology tailored for legal work have led some lawyers to worry that their profession may be Silicon Valley’s next victim.

But recent research and even the people working on the software meant to automate legal work say the adoption of A.I. in law firms will be a slow, task-by-task process. In other words, like it or not, a robot is not about to replace your lawyer. At least, not anytime soon.

Continue reading

March 22, 2017 in Legal Education | Permalink | Comments (1)

Byrnes & Munro:  Background And Current Status Of FATCA

LexisWilliam Byrnes (Texas A&M) & Robert J. Munro (Texas A&M), Background and Current Status of FATCA, in LexisNexis Guide to FATCA & CRS Compliance (5th ed., 2017):

The Foreign Account Tax Compliance Act, referred to as FATCA, does not operate in a global tax vacuum. It is nearly impossible to comprehend fully its impact unless its highly technical procedural provisions are viewed in context. This introductory chapter will provide certain background information necessary to understand FATCA, its offspring like the OECD's CRS, and the impact of these initiatives.

FATCA's ostensible purpose was to act as an additional tax revenue source to offset additional spending in the HIRE Act of 2010. FATCA was passed on the unsubstantiated basis that “each year, the United States loses an estimated $100 billion in tax revenue due to offshore tax abuses.” However, the total amount of the offset revenue from FATCA was only projected to $8.714 billion for the ten year period of 2010 to 2020. This chapter explores the revenue raised until 2017 and the offsetting compliance costs.

Continue reading

March 22, 2017 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Tuesday, March 21, 2017

Hemel Presents The Federalist Safeguards of Progressive Taxation Today At Georgetown

HemelDaniel Hemel (Chicago) presents The Federalist Safeguards of Progressive Taxation at Georgetown today as part of its Tax Law and Public Finance Workshop Series hosted by John Brooks and Itai Grinberg.

This essay considers the distributional consequences of the Supreme Court’s federalism jurisprudence over the past quarter century, focusing specifically on the anticommandeering, anti-coercion, and state sovereign immunity doctrines. The first of these doctrines prevents Congress from compelling the states to administer federal programs; the second prevents Congress from achieving the same result through offers that for practical purposes the states cannot refuse; the third prohibits Congress from abrogating state sovereign immunity outside a limited class of cases. These doctrines vest the states with valuable entitlements and allow the states to sell those entitlements back to Congress for a price. In this respect, the doctrines have an intergovernmental distributional effect, shifting wealth from the federal government to the states.

Continue reading

March 21, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Will Law Schools Experience A Late 'Trump Bump' This Admissions Cycle?

TrumpFollowing up on my previous posts (links below): National Law Journal, The 'Trump Bump' for Law Schools Is (Kind of) a Thing:

Is the Trump administration's early turmoil a gift to legal education?

Pundits have speculated that Washington's recent turbulence will spur a surge in law school applicants, given the armies of lawyers—hailed by many as defenders of democracy—that assembled at airports around the country in the wake of President Donald Trump's so-called Muslim ban.

Despite the hype, most law schools have yet to see a significant Trump bump, though some report that recent political events are foremost in the minds of many of this year's applicants. Admissions officials at law schools who have seen an increase in applications say it's difficult to attribute that rise to any one factor, but they allow that Trump is one of the many variables contributing to greater interest in the law, from both his supporters and those who oppose his policies.

Continue reading

March 21, 2017 in Legal Education | Permalink | Comments (4)

Bird-Pollan:  Utilitarianism And Wealth Transfer Taxation

Jennifer Bird-Pollan (Kentucky), Utilitarianism and Wealth Transfer Taxation, 69 Ark. L. Rev. 695 (2016):

This article is the third in a series examining the continued relevance and philosophical legitimacy of the United States wealth transfer tax system from within a particular philosophical perspective [Death, Taxes, and Property (Rights): Nozick, Libertarianism, and the Estate Tax, 66 Maine L. Rev. 1 (2013); Unseating Privilege: Rawls, Equality of Opportunity, and Wealth Transfer Taxation, 59 Wayne L. Rev. 713 (2014);]. The article examines the utilitarianism of John Stuart Mill and his philosophical progeny and distinguishes the philosophical approach of utilitarianism from contemporary welfare economics, primarily on the basis of the concept of “utility” in each approach.

Continue reading

March 21, 2017 in Scholarship, Tax | Permalink | Comments (0)

Dean Of 'Beleaguered' Charlotte Law School Steps Down; Interim Dean Named

Charlotte Logo (2016)Following up on my previous posts (links below): Charlotte Observer, Top Charlotte School of Law Leader Steps Down:

With his school’s future hanging in the balance, the dean of the beleaguered Charlotte School of Law is stepping down.

Jay Conison has led the uptown, for-profit school for almost four years. Charlotte Law announced his departure with a four-paragraph statement Monday afternoon. Conison will remain on the faculty, the statement said. He will be replaced on an interim basis by Scott Broyles, a former federal prosecutor who joined the Charlotte faculty in 2006.

Continue reading

March 21, 2017 in Legal Education | Permalink | Comments (1)

The Best And Worst States For Business: 90% Of The Top 10 Voted For Trump; 80% Of The Bottom 10 Voted For Clinton

Robert W. McGee (Fayetteville State University), The First McGee Annual Report on the Best and Worst States for Business:

This study is the first annual McGee Report on the best and worst states for business. The fifty states are ranked based on the extent to which they facilitate business creation and expansion. This study incorporated the data collected from five other studies, which included the examination of hundreds of variables. Utah was found to be the most business friendly state; California was least business friendly. States that voted Republican in the 2016 presidential election tended to be more business friendly than states that voted Democratic.

Top 10

Continue reading

March 21, 2017 in Scholarship, Tax | Permalink | Comments (29)

Georgetown Hosts Conference Today On Understanding The House GOP Healthcare Reform Bill

OneillThe Georgetown O’Neill Institute for National and Global Health Law hosts a conference today on “Repeal and Replace” the Affordable Care Act: Understanding the House GOP Healthcare Reform Bill:

This forum will explain the key features of the American Health Care Act (AHCA), the House Republican’s bill to “repeal and replace” the Affordable Care Act (ACA), as well as the effects of the AHCA on the tax system, the insured (and uninsured) populations, and the national budget. Experts in health law and policy, tax law and policy, social insurance programs, and budget policy will discuss the details of the bill, how it differs from the ACA, the intricacies of Congressional rules and the procedures that are driving the bill’s structure, and the overall state of health care policy in the United States. 

Panel 1:  Taxes and Transfers:

  • Lily Batchelder (NYU), Deficit, Distributional, Coverage, & Premium Effects of the AHCA 
  • John R. Brooks (Georgetown), Tax Credits and Redistribution Under the ACA and the AHCA 
  • Lilian Faulhaber (Georgetown), Taxes and Transfers Under the ACA

Continue reading

March 21, 2017 | Permalink | Comments (0)

Kleinbard Presents The Economic And Social Consequences Of Tax Reform At Loyola

Kleinbard (2015)Edward Kleinbard (USC) presented The Economic and Social Consequences of Tax Reform last night at Loyola Marymount University College of Business Administration's Center for Accounting Ethics, Governance, and the Public Interest's Distinguished Speaker Series (flyer):

Wide-ranging tax reform is a tax priority for Congressional Republican leaders and President Trump. Professor Kleinbard will discuss the implications of proposed tax changes for the economy, social programs, and inequality.

March 21, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

NY Times:  Chief Justice Roberts Considers The Case Of Tom Sawyer

Tom SawyerNew York Times: Chief Justice Roberts Considers the Case of Tom Sawyer, by Adam Liptak:

Tom Sawyer, Mark Twain’s fictional rapscallion, turned up on Wednesday night in the ballroom of a fancy Washington hotel. No stranger to adventures and indignities, he was there to endure something new and distinctively American: a lawsuit.

A lighthearted Chief Justice John G. Roberts Jr. presided over the case, brought by several boys, played by actors, who had come to regret whitewashing Aunt Polly’s fence. Tom’s guile in persuading them to do his work, they said, amounted to fraudulent misrepresentation.

The boys, though of limited means, had somehow managed to hire Paul D. Clement, a legal superstar, to represent them. But Mr. Clement faced an uphill fight.

“Your clients are not blameless in this affair,” Chief Justice Roberts said. “They don’t come here with clean hands. Their purpose in approaching Mr. Sawyer was to taunt him.”

Mr. Clement, who appears frequently before the chief justice in actual Supreme Court arguments, said he worried that his clients — Ben Rogers, Johnny Miller and Billy Fisher — could not get a fair hearing given Tom’s celebrity.

“We don’t play favorites for famous people,” Mr. Clement said. “The law is supposed to treat the Tom Sawyers of the world and the Ben Rogerses of the world the same.”

Continue reading

March 21, 2017 in Legal Education | Permalink | Comments (0)

Monday, March 20, 2017

Hemel Presents The Federalist Safeguards of Progressive Taxation Today At NYU

HemelDaniel Hemel (Chicago) presents The Federalist Safeguards of Progressive Taxation at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Rosanne Altshuler:

This essay considers the distributional consequences of the Supreme Court’s federalism jurisprudence over the past quarter century, focusing specifically on the anticommandeering, anti-coercion, and state sovereign immunity doctrines. The first of these doctrines prevents Congress from compelling the states to administer federal programs; the second prevents Congress from achieving the same result through offers that for practical purposes the states cannot refuse; the third prohibits Congress from abrogating state sovereign immunity outside a limited class of cases. These doctrines vest the states with valuable entitlements and allow the states to sell those entitlements back to Congress for a price. In this respect, the doctrines have an intergovernmental distributional effect, shifting wealth from the federal government to the states.

Continue reading

March 20, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Fewer Than 1,000 Taxpayers Come Clean To The IRS On Virtual Currency Transactions

Bitcoin IRSFortune, Only 802 People Told the IRS About Bitcoin—Lawsuit:

The Internal Revenue Service revealed new details about its investigation into tax evasion related to bitcoin, filing court documents that suggest only a tiny percentage of virtual currency owners are reporting profits or losses in their annual returns.

Continue reading

March 20, 2017 in IRS News, Tax | Permalink | Comments (0)

More On The 'Full Citizenship Project For All Law Faculty'

DeanFollowing up on last week's post, 'Full Citizenship Project For All Law Faculty' Launched To Correct Gender Disparities Among Law Profs:

Legal Skills Prof Blog: The Role of Legal Writing Professors in the Academy: A Reply to Professor Jason Yackee, by Scott Fruehwald:

In reaction to the announcement on TaxProf Blog, Professor Jason Yackee [Wisconsin] made two comments there that showed an egregious ignorance of the role of legal writing professors in the academy.  This post's purpose is to examine the role of legal writing professors in today's law schools.

Continue reading

March 20, 2017 in Legal Education | Permalink | Comments (8)

Kamin & Setser:  The House Plan's Bad Math — Over-Estimates Of Revenue From A Border Adjustment

David Kamin (NYU) & Brad Setser (Council on Foreign Relations), House Plan's Bad Math: Over-Estimates of Revenue from a Border Adjustment:

One of the largest revenue raisers in the House Republicans’ framework for business tax reform is a “border adjustment.” However, projections of revenue from the border adjustment overstate revenue in two ways.

Continue reading

March 20, 2017 in Scholarship, Tax | Permalink | Comments (0)

Cincinnati Law School Dean Under Fire From Faculty: Ouster, Vote Of No Confidence Discussed As Provost Unveils 6-Month Plan To 'Restore Mutual Trust And Respect' And Dean Lawyers Up

UC BardCincinnati Business Courier, University of Cincinnati Law Dean Under Fire From Faculty:

A group of faculty at the University of Cincinnati College of Law is calling for the ouster of its new dean less than halfway into her five-year contract due to an apparent conflict of priorities.

Meanwhile, UC's interim provost [Peter Landgren] is drafting a six-month plan to "restore mutual trust and respect" as the result of internal consternation between College of Law dean Jennifer Bard and a group of faculty. ...

[A] group of at least nine law professors discussed holding a vote of no confidence in Bard as early as Nov. 22, 2016. ...

A document announcing the plan drafted in December by Landgren and obtained by the Courier through a public records request states that Bard recognizes that certain decisions she has made in her 18-month tenure have created a rift between her own vision for the law school and that of a group of faculty. "Also recognized by the dean are issues relating to her work with and rapport amongst the college's staff," the document reads. ...

Bard, the first female dean of UC's College of Law, started in July 2015. She has an annual salary of $300,000 and her contract runs through June 2020. She previously served as special assistant to the provost for academic engagement at Texas Tech University in Lubbock and directed its J.D./M.D. program. Bard succeeded Louis Bilionis, who returned to full-time teaching after serving two terms as dean. ...

Continue reading

March 20, 2017 in Legal Education | Permalink | Comments (5)

ABA Proposes To Eliminate Requirement That More Than 50% Of Law Teaching Be Performed By Full-Time Faculty

ABA Section On Legal Education (2016)ABA Journal, ABA's Legal Ed Section Seeks Comments on Proposed Revision to Admissions Test Standard:

Should the American Bar Association’s Council of the Section of Legal Education and Admissions to the Bar devise a process to validate non-LSAT entrance exams? The council has requested notice and comment on how such a test might be established. The proposed revision to Standard 503 calls for the council to establish a process that determines reliability and validity of other tests besides the LSAT. That’s a change from the current version, which directs law schools using alternate admissions tests to demonstrate that the exams are valid and reliable. Any changes would not take place prior to the 2018-2019 admissions cycle. ...

Continue reading

March 20, 2017 in Legal Education | Permalink | Comments (4)

The IRS Scandal, Day 1411: Why Did Donald Trump Fire Sally Yates And Preet Bharara, But Not John Koskinen?

IRS Logo 2

Washington Examiner, Why Is Trump Afraid of Draining the Swamp at the IRS and Firing John Koskinen?:

Political cartography in Washington can be difficult. After three months in office, it's clear President Trump doesn't believe the D.C. bog includes the federal building at the corner of 12th Street and Pennsylvania Avenue. He won't drain the swamp at the Internal Revenue Service.

Famous for firing people, Trump has disrupted the status quo in the nation's capital with his personnel decisions. He quickly terminated Acting Attorney General Sally Yates, then sacked 46 federal prosecutors. But he won't ax IRS Commissioner John Koskinen.

Conservatives have been gunning for the tax chief's scalp for years. To no avail, they've tried shaming, officially censuring, and impeaching Koskinen. But now that Trump's in the White House, they're wondering why the president is sheltering the taxman. ...

The Trump White House keeps dodging the question. On Friday, press secretary Sean Spicer referred curious reporters inquiring about Koskinen's fate to the Treasury Department, even after it came to light that the agency still has 7,000 unreleased documents related to the scandal. ...

Trump has every reason to dismiss the tax agent. With Koskinen at the helm, the IRS was able to cover up its targeting scandal. Brought in by President Obama to clean up the agency's image, he turned a blind eye as the IRS covered up its scandal and continued to violate citizen's First Amendment rights.

Continue reading

March 20, 2017 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

TaxProf Blog Weekend Roundup

Sunday, March 19, 2017

NY Times:  Will Dropping The LSAT Requirement Create More Miserable Lawyers?

Harvard GREFollowing up on my previous post, Harvard Is Second Law School To Admit 1Ls Based On GRE Rather Than LSAT:  New York Times Sunday Review, Will Dropping the LSAT Requirement Create More Miserable Lawyers?:

Harvard Law School recently announced that it will no longer require Law School Admission Test scores from applicants, joining the University of Arizona James G. Rogers College of Law in this new policy. Students can now submit scores on the Graduate Record Examination, known as the GRE, instead.

The move might succeed in expanding the pool of applicants. But here’s what it won’t do: increase the number of people in law school who actually want to be lawyers.

Continue reading

March 19, 2017 | Permalink | Comments (8)

University Of Houston Law School Spent $500k In Attorneys' Fees In Trademark Dispute With South Texas Law School; More Fees Are Coming With Houston Astros On Deck

UHSTHAFollowing up on last week's post, Settlement Finalized In University Of Houston And South Texas Houston Law Schools Trademark Dispute; Houston Astros Are On Deck:  Houston Chronicle, What's in a Name? $500K in Legal Fees For UH Over Law School Dispute:

The University of Houston spent more than $500,000 on legal fees challenging a crosstown rival law school's new name over the past 10 months in a federal trademark dispute finally resolved through mediation, a university spokesman said Friday.

But the costs may continue to mount as UH faces potential trademark challenges from the Houston Astros and Houston Community College over its attempt to claim the word "Houston" for educational purposes.

Continue reading

March 19, 2017 | Permalink | Comments (0)

The Top 5 Tax Paper Downloads

SSRN LogoThis week's list of the Top 5 Recent Tax Paper Downloads is the same as last week's list. The #1 paper is now #112 in all-time downloads among 12,595 tax papers:

  1. [1,590 Downloads]  The Known Unknowns of the Business Tax Reforms Proposed in the House Republican Blueprint, by Michael J. Graetz (Columbia)
  2. [525 Downloads]  How Donald Trump can Keep His Campaign Promises, Grow the Economy, Cut Tax Rates, Repatriate Offshore Earnings, Reduce Income Inequality, Keep Jobs in the United States, and Reduce the Deficit, by David S. Miller (Proskauer, New York)
  3. [424 Downloads]  Accounting for Behavioral Considerations in Business Tax Reform: The Case of Expensing, by Lily L. Batchelder (NYU)
  4. [346 Downloads]  Predicting Stock Market Prices with Physical Laws, by Jack Manhire (Texas A&M)
  5. [253 Downloads]  Important Developments in Federal Income Taxation, by Edward A. Morse (Creighton)

March 19, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

25 Catholic Law School Deans Join ABA, 150 Law Firms In Opposing President Trump's Proposed Elimination Of The Legal Services Corp.

LSC (2017)National Law Journal, Legal Services Corp., Under Trump, Faces New Threat to Existence:

The Legal Services Corp., created in 1974 under the signature of President Richard Nixon, is once again on the chopping block as another Republican president — Donald Trump — proposes to zero out its funding in his first budget. The group’s 2017 budget request was $502 million.

Continue reading

March 19, 2017 in Legal Education | Permalink | Comments (5)

The IRS Scandal, Day 1410: Judicial Watch Forces Disclosure Of New Documents

IRS Logo 2

Breitbart op-ed: Obama IRS Scandal Continues – Judicial Watch Forces IRS to Disclose New Documents, by Tom Fitton (President, Judicial Watch):

We have no intention to allow the extra-legal activities of former President Obama’s administration to fade into the sunset now that he is out of office. Particularly egregious was his use of the might of the Internal Revenue Service (IRS) to target groups that disagreed with his political views.
And heel-dragging at the IRS continues.

Last week, Judicial Watch reported that the agency informed the U.S. District Court that it located “an additional 6,924 documents of potentially responsive records” relating to our 2015 Freedom of Information Act (FOIA) lawsuit regarding the Obama IRS targeting scandal.

The lawsuit at issue sought records about the IRS selection of individuals and organizations for audits based upon applications requesting non-profit tax status filed by Tea Party and other 501(c)(4) tax-exempt organizations (Judicial Watch v. Internal Revenue Service (No. 1:15-cv-00220)). ...

The corruption at the IRS is astounding. Our attorneys knew that there were more records to be searched, but the Obama IRS ignored this issue for years.

Remember that in July 2015, we released Obama IRS documents confirming that the agency used donor lists of tax-exempt organizations to target those donors for audits. The documents also show that IRS officials specifically highlighted how the U.S. Chamber of Commerce may come under “high scrutiny” from the IRS.

In September 2014, another JW FOIA lawsuit forced the release of documents detailing that the IRS sought, obtained, and maintained the names of donors to tea party and other conservative groups. IRS officials acknowledged in these documents that “such information was not needed.” The documents also show that the donor names were being used for a “secret research project.”

The Obama IRS scandal continues, and President Trump needs to clean house at the IRS as quickly as possible.

Continue reading

March 19, 2017 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, March 18, 2017

This Week's Ten Most Popular TaxProf Blog Posts

The BigLaw Massacre Approaches

Robot Lawyer 2The American Interest, The BigLaw Massacre Approaches:

Bad news for the tens of thousands of newly minted lawyers who pass the bar every year and hope to get associate positions at big law firms sorting through documents for corporate clients: Robots are taking your jobs[,] Blommberg reports [JPMorgan Software Does in Seconds What Took Lawyers 360,000 Hours]. ...

Continue reading

March 18, 2017 in Legal Education | Permalink | Comments (6)

Republicans Keep Repeating The Same Tax Mistake

Laffer Curve (2017)Bloomberg View:   Republicans Keep Repeating the Same Tax Mistake, by Megan McArdle:

It looks as if Governor Sam Brownback may be leaving Kansas to take up a job at the United Nations. Brownback’s critics, of which there are many, charge that having led his state into a fiscal crisis, he’s bailing out on the wagon train while the rest of his party staggers onward over the cliff. “Brownback would be fleeing a political and economic crisis,” writes Alan Pyke of ThinkProgress, “leaving about 3 million Kansans behind in a budgetary inferno of his own devising.”

You can certainly see why Brownback would want to get out. After Republicans pushed through aggressive tax cuts in 2012 and 2013, the state keeps coming up with deep budget holes that have to be patched in an annual scramble. This year’s drama is still being played out after the governor vetoed a plan to raise taxes, and the state Senate responded by crushing Brownback’s proposed alternative.

For budget wonks, the saga of the Kansas budget will be reminiscent of the Reagan years, when supply-side tax cuts resulted in big deficits. The administration had hoped that the tax cuts could be paid for by a combination of faster economic growth unleashed by lower marginal rates, and the infamous “magic asterisk” (in which unidentified spending cuts were promised, details to come later).

Continue reading

March 18, 2017 in Tax | Permalink | Comments (0)

University Of Idaho Law School Opens Second Location In Boise. Will It Be The Death Knell For Concordia Law School?

Boise 2Following up on my previous post, Two New Law Schools Planned in Boise, Idaho: Concordia University and University of Idaho:  Press Release, American Bar Association Approves First-Year Law Program in Boise (press coverage):

The American Bar Association (ABA) approved the opening of a first-year law program in Boise for the University of Idaho College of Law. The Idaho State Board of Education approved the first-year law program in February. A first-year law program will now be available in both the Moscow and Boise locations beginning this fall semester. ...

Continue reading

March 18, 2017 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 1409:  'After School Satan Club' Granted Tax-Exempt Status In 10 Days While Conservative Groups Waited Years

IRS Logo 2

Judicial Watch Press Release, IRS Gives “After School Satan Club” Tax-Exempt Status in 10 Days:

While the Internal Revenue Service (IRS) makes conservative groups wait years for tax-exempt status an “After School Satan Club” launched to hinder Christian-based counterparts got its nonprofit ranking in just ten days, records obtained by Judicial Watch show. The classification is offered to charitable, religious and educational organizations that operate as nonprofits. Under the Obama administration IRS political appointees illegally targeted conservative groups, either making them wait up to seven years for tax-exempt status or denying their application altogether. Judicial Watch uncovered that scandal and has obtained piles of government records showing how the IRS illegally colluded with another federal agency to single out groups with conservative-sounding terms such as patriot and Tea Party in their titles when applying for tax-exempt status.

In the meantime, leftist groups like the Satan club got fast tracked. The principle goal of establishing the Satan clubs in public schools throughout Washington State appears to be to counter existing enterprises operated by a Christian-based group. Documents obtained by Judicial Watch include the process of establishing an after-school Satan club at Point Defiance Elementary in Tacoma. The entity behind the club is a nonprofit called Reason Alliance, which is based in Somerville, Massachusetts, and operates in Washington State as the Satanic Temple of Seattle. Its director, Lilith X. Starr, established the Point Defiance Elementary Satanic club, the records show. In its application the club states that its purpose is “character development” and that adult instructors are vetted by the Satanic Temple’s “Executive Ministry.” Children ages 5-12 will develop basic critical reasoning, character qualities, problem solving and creative expression, according to the Satanic Temple filings included in the documents. The club logo is a pencil with devil’s horns. Records obtained by Judicial Watch from the Treasury Department show that the Satanic cult applied for tax-exempt status on October 21, 2014 and received it on October 31, 2014.

The parent permission forms ask for the name of the child’s church and pastor, the records show. They also reveal that Starr, the Seattle Satanic Temple director, told Tacoma School District Superintendent Carla Santorno that the clubs are led by “caring Satanists” and each child receives a membership card. Starr also tells the superintendent that the effort to establish after-school Satan clubs in Tacoma schools is in direct response to the Christian-based Good News Clubs operating in campuses throughout the district. This ignited concern among some Tacoma district officials, the records show. In one electronic mail exchange, Tacoma Schools official Andrea O-Brien-Henley sends colleague Paul Koch a citation from the Satanic Temple’s website noting that the temple only wants to establish after-school Satan clubs in school districts with Christian Good News Clubs. O’Brien-Henley notes that it’s odd that the Satanic Temple only targets schools that have Good News Clubs, writing to hear colleague: “If they really want to get their message out to kids it seems kind of odd that they would only be targeting schools with a Good News Club; one would think that they would want to start clubs anywhere there is an *interest* in them.”

Here’s the citation that O’Brien-Henley forwarded to fellow school district official Koch from the Satanic Temple’s website: “How do I start an After School Satan Club in my school district? If there isn’t a chapter of The Satanic Temple near you, but you’re interested in starting and After School Satan Club in your school district, please contact The Satanic Temple. Please keep in mind that the Satanic Temple is not interested in operating After School Satan Clubs in school districts that are not already hosting the Good News Club. However, The Satanic Temple ultimately intends to have After School Satan Clubs operating in every school district where the Good News Club is represented.”

In another exchange, the Executive Director of Communications for the Tacoma School District, Dan Voelpel, expresses concern to colleagues that people will confuse the school district’s message of tolerance toward the Satan Club with tolerance toward alleged “hate-related activities around the country in the wake of the presidential election.” In the records the principal of Point Defiance Elementary reveals that, two weeks after the Satan club was launched, no one had signed up for it. The fact remains however, that the IRS fast-tracked a deranged Satanic cult to operate as a nonprofit in taxpayer-funded elementary schools.

Continue reading

March 18, 2017 in IRS News, IRS Scandal, Tax | Permalink | Comments (8)

Friday, March 17, 2017

Weekly Tax Highlight And Roundup

This week, Joe Kristan (CPA & Shareholder, Roth & Company (Des Moines, Iowa); Editor, Tax Update Blog) discusses a recent Tax Court case highlighting the difficulty S corporation shareholders face in overcoming the way an item is characterized on a K-1.  

KristanDon’t let the K-1 hit you on the way out the door.

Sometimes people become shareholders of S corporations without really understanding what they are getting into. Yesterday the Tax Court dealt with an S corporation shareholder who apparently didn’t understand just what he was getting out of.

The taxpayer owned 50% of Resort Builders, a construction company, with his brother, John. They operated as an S corporation, with the corporate earnings being taxed on the owner 1040s based on Forms K-1 allocating the corporation income.

Over time the brothers had a falling out. Judge Vasquez explains:

Continue reading

March 17, 2017 in Tax, Weekly Tax Roundup | Permalink | Comments (0)