TaxProf Blog

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

Monday, August 20, 2007

Houston Business & Tax Law Journal Issues Call for Papers on Patenting Tax Strategies

The Houston Business & Tax Law Journal has issued a call for papers on patenting tax strategies in connection with a symposium to be held on Tuesday, October 16, 2007 at the University of Houston Law Center:

A United States Patent is a badge of honor for any inventor. It means the government considers the invention to be new and useful. As the U.S. economy shifted its focus from manufacturing to service and information, the patent system tried to keep pace. In 1998, patents on methods of doing business were recognized, and in 2003 the Patent and Trademark Office issued a patent on a tax-saving strategy. Now, anyone who uses the patented strategy can be liable for patent infringement.

Critics of tax strategy patents argue that everyone should be treated the same under the tax laws, and one should not have to pay a royalty in order to save on taxes. Tax accountants and attorneys say that some of the patented strategies are actually commonplace; not new and nonobvious as the patent law requires. Allowing patents on tax strategies would create conflicts of interest and inhibit the free flow of tax advice between adviser and client. The IRS is struggling to catch up, hiring new examiners who are versed in accounting and taxation.

Defenders of tax patents contend that the more sophisticated strategies are worthy of patent protection, to compensate the inventor and spur innovation. Most tax strategies involve relatively esoteric investment vehicles, and would not affect the average taxpayer. Once patented, the tax strategy becomes public knowledge, allowing greater review and increasing compliance.

Patents on tax strategies force us to ask fundamental questions on the nature of “invention,” “useful art,” and “business method.” With patents now affecting the tax laws themselves, has the reach of the patent system exceeded its grasp?

Submissions may be emailed to the HBTLJ in accordance with the following schedule:

Submissions Due: October 2, 2007

Final Draft of Submission: October 24, 2007

Paper acceptance/rejection: November 1, 2007

Revised paper submission: November 14, 2007

Final acceptance following revisions: November 22, 2007

Publication Date: Spring 2008

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