TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Monday, May 22, 2017

3rd Annual Mid-Career Tax Professors Workshop Kicks Off Today At Arkansas

Arkansas Fayetteville LogoPanel #1

Jennifer Bird-Pollan (Kentucky), Sovereignty, Tax, and BITs
Commentator: David Herzig (Valparaiso)

John Brooks (Georgetown), Income Tax as Wealth Tax
Commentator:  Rebecca Kysar (Brooklyn)

Emily Cauble (DePaul), Tax Law’s Inconsistent Treatment of Gains and Losses
Commentator:  Heather Field (UC-Hastings)

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

WSJ:  Law Firms Finally Say It’s OK to See a Therapist

Wall Street Journal, Law Firms Finally Say It’s OK to See a Therapist:

Big firms have long been reticent to openly address addiction and other mental-health problems, despite research showing lawyers face higher rates of substance abuse, depression and suicide than the wider population. Law-firm leaders say the need to keep up appearances in a competitive industry has contributed to the resistance.

That attitude, however, is slowly changing.

Some U.S. law firms are tackling mental-health issues head-on. They’re offering on-site psychologists, training staff to spot problems and incorporating mental-health support alongside other wellness initiatives. ...

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May 22, 2017 in Legal Education | Permalink | Comments (0)

Private Investigator's Attempt To Obtain Donald Trump's Tax Return Led IRS To Shut Down FAFSA Data Retrieval Tool; Who Hired Him?

FAFSAIRSFollowing up on my previous posts:

Diverse Issues in Higher Education, FAFSA Hacker Targeted Trump Tax Info:

The person accused of a 2016 attempt to use a web-based federal student-aid tool to illegally obtain taxpayer information is a Louisiana-based private investigator who used the tool to target then-presidential candidate Donald J. Trump, court records obtained by Diverse show.

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May 22, 2017 in IRS News | Permalink | Comments (0)

GOP Senate Cuts UNC Law School's Budget 30% As Payback To Liberal Faculty (Especially Gene Nichol), Rankings Slide From 20 (1979) To 39 (2017)

North Carolina LogoFollowing up on my previous posts (links below):  News & Observer, The GOP Crafts a Message to UNC, With a Chain Saw:

The state Senate took a chain saw to the University of North Carolina law school this month, cutting nearly a third of the state appropriation for one of the nation’s oldest law schools.

The official explanation from the Republican-controlled Senate is that we have too many lawyers in North Carolina. But not even the teenaged pages in the Senate believe that.

The GOP is sending a message: It thinks the law school faculty is liberal leaning, it doesn’t like the Center for Civil Rights, and it particularly doesn’t like Gene Nichol. ...

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May 22, 2017 in Legal Education | Permalink | Comments (23)

WSJ:  The Blind Spot In The Sharing Economy — Tax Collection?

Airbnb uberWall Street Journal Tax Report: The Blind Spot in a Sharing Economy: Tax Collection, by Laura Saunders:

A loophole is helping gig-economy workers, online sellers and home-sharing hosts cheat on their taxes.

Under a law enacted in 2008 and later clarified by the Internal Revenue Service, many online-platform businesses that connect buyers and sellers and take credit-card payments, such as Airbnb, TaskRabbit, Etsy and ride-sharing firms, fall into a special category.

These businesses have to report a provider’s income to the IRS only if that person earns more than $20,000 and has more than 200 transactions. In that case, the company sends both the provider and IRS a Form 1099-K listing gross income.

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May 22, 2017 in Tax | Permalink | Comments (0)

TaxProf Blog Weekend Roundup

Sunday, May 21, 2017

San Diego Dean: It Is Time To Rethink The California Bar Exam

California Bar ExamStephen Diamond (Santa Clara), Time to Rethink the California Bar Exam, San Diego Dean Stephen Ferruolo Testifies:

It was the testimony [before the Standing Committee on the Judiciary of the California State Assembly] of Stephen Ferruolo, the dean of the University of San Diego’s Law School, that really caught my attention. Dean Ferruolo shared his full statement to the committee with me and you can read it here. (The dean’s testimony begins at 57:54 on the video archive.)

The conclusion I drew from his testimony and the discussion that ensued with the legislators is that the current form of the California bar (including the new 2 day version that starts this summer) is, in essence, an outdated regulatory barrier to needed innovation in legal education. Because of the exceptionally large number of subjects tested as well as because of the bias towards multiple choice questions (now heightened with the 2 day bar) law school curriculum is being distorted in a way that creates a disconnect between what is taught in law schools and what it is new lawyers need to know to be successful.

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May 21, 2017 in Legal Education | Permalink | Comments (3)

John Oliver Property Tax Scam Uses Loophole Created By Donald Trump

John Oliver 2New York Observer, The John Oliver Property Tax Scam: HBO Comedian Secretly Buys Manhattan Mansion; Liberal Deity Avoids Taxes By Using Loophole Created By Donald Trump:

The hypocrisy really gets ratcheted up with John Oliver, the No. 1 darling to so many liberal anti-Trumpies, who regularly attacks GOP tax schemes as giveaways to the rich and detrimental to the poor. ... 

For years, Oliver has criticized the estate tax, which opponents, in a smart linguistic move dreamed up by Frank Luntz, long ago labeled the “death tax”; and the tax code’s raft of loopholes that benefit special interests he identified as oil companies and hedge fund managers. Oliver even briefly established the bogus Our Lady of Perpetual Exemption to draw attention to tax-exempt status granted to churches and charities.

Back in July 2014, in an episode in which he lamented the Wealth Gap in America” (which has resulted in the richest one percent of Americans controlling 20 percent of annual income), Oliver said, “At this point the rich are just running up the score…What sets America apart is that we are actively introducing policies that disproportionately benefit the wealthy,” such as tax cuts and loopholes like trusts.

So it’s a little surprising to discover that just months before, Oliver had a tax attorney set up two revocable trusts, one for him and one for his wife, to hide the couple’s purchase of a $9.5 million Manhattan penthouse. Then he used a tax loophole created by Donald Trump himself back in the 1970s, when the current president was merely a prominent New York real estate developer and aspiring celebrity author.

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May 21, 2017 in Celebrity Tax Lore, Tax | Permalink | Comments (3)

Closing More Law Schools Won't Solve The Problem; Changing The Model And Delivery Of Legal Education Will

SorrySusan Cartier Liebel (Founder & CEO, Solo Practice University), If We Close Some Law Schools, Legal Education Will Be Saved! Wrong.:

[W]e do not have too many law schools.  ...  What we have is too many law schools operating under an antiquated model and that is why we are turning out too many under-educated lawyers who cannot qualify or compete in a changing market. This creates a glut of debt-ladened, disillusioned students, ill-equipped to fend for themselves.

Closing schools doesn’t solve the problem.

Closing schools just reduces the number of debt-ladened, disillusioned students still ill-equipped to fend for themselves. Changing the education model and method of delivery of this education will fix the problem. ...

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

The Top 5 Tax Paper Downloads

SSRN LogoThere is quite a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with new papers debuting on the list at #3, #4, and #5:

  1. [306 Downloads]  The Offshore Tax Enforcement Dragnet, by Shu-Yi Oei (Tulane)
  2. [229 Downloads]  BEPS and the New International Tax Order, by Allison Christians (McGill)
  3. [202 Downloads]  Can New York Publish President Trump's State Tax Returns? , by Daniel Hemel (Chicago)
  4. [171 Downloads]  A Global Treaty Override? The New OECD Multilateral Tax Instrument and Its Limits, by Reuven S. Avi-Yonah (Michigan) & Haiyan Xu (Michigan)
  5. [149 Downloads]  Base Erosion by Intra-Group Debt and BEPS Project Action 4's Best Practice Approach: A Case Study of Chevron, by Antony Ting (Sydney)

May 21, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, May 20, 2017

This Week's Ten Most Popular TaxProf Blog Posts

Should La Verne And Other Law Schools With Low First-Time Bar Passage Rates Follow Whittier's Lead And Close?

Laverne (2017)Bloomberg Law, Are Law Schools with Low Bar Pass Rates at Risk of Closing?:

The University of La Verne College of Law enrolls over 100 students each year, and if past history is any indication, only slightly more than half, 54 percent, will likely pass the bar on their first try after graduation.

Should that affect whether it stays open?

The disconnect between a school’s low bar passage rate, relative to other schools in the country, and its ability to draw applicants raises a question that’s been looming for legal education regulators: Is the bar passage rate the best way to measure whether a law school is adequately preparing its students to become lawyers?

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May 20, 2017 in Legal Education | Permalink | Comments (7)

Facing Competition From GRE, LSAC Allows Applicants To Take LSAT An Unlimited Number Of Times

LSAT (2015)In the face of growing competition from the GRE (which is now accepted by Arizona and Harvard), the LSAC today is permitting 1,000 applicants to take a digital version of the LSAT.  In additional, the LSAC is removing the limit on how many times students can take the LSAT (the former limit was three times in any two-year period).

The ABA and LSAC require law schools to report each applicant's highest LSAT score, which counts 12.5% in the U.S. News rankings.  The rule change thus gives wealthier students who can afford to take the LSAT multiple times an enormous advantage in law school admissions.

The rule change also will increase LSAC's revenues, which were $59.7 million in its most recent publicly available Form 990.  LSAC has $238 million of assets and paid its President $692,000.  Four other employees were paid over $300,000. 

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May 20, 2017 in Legal Education | Permalink | Comments (0)

Reinterpreting Corporate Inversions: Non-Tax Competitions And Frictions

Inho Andrew Mun (J.D. 2017, Yale), Note, Reinterpreting Corporate Inversions: Non-Tax Competitions and Frictions, 126 Yale L.J. 2152 (2017)

Corporate inversions have drawn outrage from all segments of society. In an inversion, a company reincorporates abroad to escape its U.S. tax burden. Regulators and academics have typically sought tax law solutions to curb tax inversions. However, the resulting tax regulations have been ineffective, while more radical tax reforms are not politically feasible. This Note argues that inversion is not a tax problem in isolation, but a problem of aligning tax paid with benefits conferred by a given country. By introducing non-tax dimensions into the equation, this Note refines the oft-ignored benefit tax theory. The benefit tax theory proposes that the U.S. corporate tax regime accounts for superior legal and nonlegal benefits that companies enjoy by incorporating or operating in the United States. While paying U.S. tax, corporations receive the benefits of corporate governance, securities regulation, intellectual property law, and other areas of law; furthermore, benefits include many nonlegal business factors such as access to a large consumption market, skilled labor pool, capital markets, and more.

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

Friday, May 19, 2017

Congratulations, Pepperdine Law School Class of 2017!

SOL Graduation 2017 (1)
Photo Credit: Jessie Fahy

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May 19, 2017 in Legal Education | Permalink | Comments (0)

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 perils of do-it-yourself tax preparation.

KristanThe perils of do-it-yourself tax prep.

I’ve tried to do plumbing myself. I have learned that it is cheaper in the not-very-long run to pay a plumber.

An insurance consultant learned a similar lesson about tax preparation in Tax Court last week. His client specialty was accountants. Whether out of thrift or because he didn’t want to be seen playing favorites, he used TurboTax. It went badly in Tax Court.

The taxpayer claimed disallowed deductions for alimony and for a net operating loss. The court determined that he reported too much Alimony, and that he whiffed entirely on the NOL. The deficiency was big enough to bring the 20% “accuracy related” penalty into play. Judge Holmes considers the issue:

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May 19, 2017 in Tax, Weekly Tax Roundup | Permalink | Comments (0)

Weekly SSRN Tax Article Review And Roundup

This week, Erin Scharff (Arizona State) reviews an article by Darien Shanske (Davis), The (Now Urgent) Case for State-Level Monitoring of Local Government Finances (or, One Way to Protect Localities from Trump's 'Potemkin Villages of Nothing'), forthcoming in the NYU Journal of Legislation and Public Policy: 

Scharff (2017)Darien Shanske’s forthcoming article on local government financing suggests reforms that might protect local governments from their own bad decisions.   The fiscal challenges facing local governments are enormous, and Shanske persuasively argues localities are ill equipped to deal with these problems on their own.  And his proposal responds to the variety of fiscal problems facing cities. There are problems both with the ways cities spend their revenue and also their revenue streams.  Too often, we foucs on only one side of this problem.

At the time Shanske wrote the paper, he was particularly worried about the possibility of a federal infrastructure plan that would flood local governments with public-private partnership opportunities that would fail to deliver promised benefits.  As Shanske’s title alludes to, Larry Summers denounced such infrastructure spending as a “Potemkin Village [] of nothing.”

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May 19, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Legal Education Roundup

Houston Hosts Third Annual Texas Tax Faculty Workshop

Houston (2017)The University of Houston Law Center hosts the Third Annual Tax Faculty Workshop today:

Bryan Camp (Texas Tech), Application of Equitable Principles to Jurisdictional Time Periods
Commentator: Terri Helge (Texas A&M)

Calvin Johnson (Texas), Beckemeyer and the Tax Benefit Rule
Commentator: Johnny Buckles (Houston)

Susan Morse (Texas), The Dark Side of Safe Harbors?
Commentator: Bruce McGovern (South Texas)

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May 19, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Tax Policy In The Trump Administration

Soled & Thomas:  Regulating Tax Return Preparation

Jay A. Soled (Rutgers) & Kathleen DeLaney Thomas (North Carolina), Regulating Tax Return Preparation, 58 B.C. L. Rev. 151 (2017):

Every year the U.S. government collects nearly $3 trillion of income and employment taxes, a large share of which is used to deliver social welfare benefits to the poor. With respect to these collections and deliveries, the Form 1040 (U.S. Individual Income Tax Return) seeks to ensure taxpayer accuracy. In the twenty-first century, there are two sets of key players that dominate the Form 1040 preparation and submission process, namely, tax return preparers and tax return preparation software companies. The former hand-hold taxpayers through the entire tax return preparation and submission process while the latter provide taxpayers with the necessary tools to complete and submit tax returns on their own. These two groups – tax return preparers and tax software companies – thus stand as vital intermediaries between the government and taxpayers, assisting in the preparation of over 90 percent of all individual tax returns.

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May 19, 2017 in Scholarship, Tax | Permalink | Comments (1)

Thursday, May 18, 2017

Roin:  Retroactive Taxation, Unfunded Pensions, And Shadow Bankruptcies

Julie Roin (Chicago), Retroactive Taxation, Unfunded Pensions, and Shadow Bankruptcies, 102 U. Chi. L. Rev. 559 (2017):

Academics and journalists criticize politicians for the dismal financial situations of many state and local jurisdictions. And certainly, politicians routinely make inaccurate fiscal claims. However, the voting public bears some of the blame for continuing to vote for politicians peddling what amounts to fiscal “magic.” This Article suggests a mechanism for holding them at least partially accountable for their carelessness: retroactive taxation triggered by objective measures of fiscal distress.

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May 18, 2017 in Scholarship, Tax | Permalink | Comments (1)

Trump Proposes To Dramatically Cut Law Student Loans

Washington Post, Trump and DeVos Plan to Reshape Higher Education Finance:

Budget documents obtained by The Washington Post show President Trump’s administration is proposing a raft of changes that could have significant impact on college students and graduates.

One of the most striking higher education proposals calls for replacing the five income-driven student loan repayment plans with a single plan to the benefit of undergraduate borrowers. As Trump promised last year on the campaign trail, the new plan would cap repayment to 12.5 percent of the borrower’s income and forgive the balance of the loan after 15 years. That would apply if the loans were taken out for an undergraduate degree. Anyone with graduate loans would expect to pay the same percentage of their income, but would only receive forgiveness after 30 years.

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May 18, 2017 in Legal Education | Permalink | Comments (5)

Barry & Pollman:  Regulatory Entrepreneurship

Jordan M. Barry (San Diego) & Elizabeth Pollman (Loyola-L.A.), Regulatory Entrepreneurship, 90 S. Cal. L. Rev. 383 (2017):

This Article examines what we term “regulatory entrepreneurship”—pursuing a line of business in which changing the law is a significant part of the business plan. Regulatory entrepreneurship is not new, but it has become increasingly salient in recent years as companies from Airbnb to Tesla, and from DraftKings to Uber, have become agents of legal change. We document the tactics that companies have employed, including operating in legal gray areas, growing “too big to ban,” and mobilizing users for political support. Further, we theorize the business and law-related factors that foster regulatory entrepreneurship. Well-funded, scalable, and highly connected startup businesses with mass appeal have advantages, especially when they target state and local laws and litigate them in the political sphere instead of in court.

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May 18, 2017 in Scholarship, Tax | Permalink | Comments (0)

Grinberg:  The House GOP Blueprint Can Be Drafted To Comply With WTO Rules

Itai Grinberg (Georgetown), The House GOP Blueprint Can Be Drafted to Comply with WTO Rules:

The House GOP Blueprint can be drafted into legislation in a manner that would comply with the United States’ international trade obligations. This paper presents two alternative approaches that avoid the key WTO discrimination and subsidy issues often raised in discussions of destination-based cash flow tax proposals.

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May 18, 2017 in Scholarship, Tax | Permalink | Comments (0)

NTA 47th Annual Spring Symposium On Taxation In The Trump Era


The NTA 47th Annual Spring Sympoisum on Taxation in the Trump Era: Reforms, Revenues and Repercussions kicks off today in Washington, D.C.  Tax Prof speakers include:

Exploring the Destination-Based Cash Flow Tax

Organizer: Itai Grinberg, Georgetown University Law Center
Moderator: Lily Faulhaber, Georgetown University Law Center

Destination-Based Cash Flow Taxation
Alan Auerbach, University of California, Berkeley, Michael P. Devereux, Oxford University Centre for Business Taxation, Michael Keen, International Monetary Fund, and John Vella, Oxford University Centre for Business Taxation

Problems with Destination-Based Corporate Taxes and the Ryan Blueprint
Kimberly Clausing, Reed College and Reuven Avi-Yonah, University of Michigan Law School

Can a Destination-Based Cash Flow Tax be Compatible with the WTO Commitments of the United States?
Itai Grinberg, Georgetown University Law Center

Is the Destination-Based Cash Flow Tax Easily Gamed?
John Vella, Oxford University Centre for Business Taxation

Using the Tax Code to Support Families: Past, Current and Future Policy


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May 18, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (2)

Debby Merritt Criticizes Doug Kahn’s 'Ignorance Of Clinical Education'

ClinicalFollowing up on Monday's post, The Downside of Requiring Additional Experiential Courses in Law School:  Deborah Jones Merritt (Ohio State), What Do Students Do in Clinics?:

Douglas Kahn has posted an article criticizing the “proliferation of clinical and other experiential courses” in legal education. These courses, he argues, reduce the number of “doctrinal” courses that students take, leaving them “ill-prepared to practice law as soon after graduation as law firms would like.” The TaxProf Blog posted a summary of the article, and a baker’s dozen of readers have offered pro and con comments.

It’s an old debate, one that has bristled for more than 50 years. The discussion doesn’t surprise me, but Professor Kahn’s ignorance of clinical education does. His bold assertions about clinics reveal little familiarity with the actual operation of those courses. Let’s examine some of Kahn’s claims. ...

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May 18, 2017 in Legal Education | Permalink | Comments (5)

Hurt:  The Private Ordering Of Publicly Traded Partnerships

Christine Hurt (BYU), The Private Ordering of Publicly Traded Partnerships:

Publicly traded partnerships, or master limited partnerships as they are sometimes called, are hybrid entities. Attempting to achieve the perfect structure for organizing economic activity, new statutes added limited liability to entities that enjoy flow-through taxation. However, because of parallel refinements by federal regulators involving taxation and amendments by state legislatures involving fiduciary duties, a strange genetic mutation flourished: the publicly traded partnership (PTP). The PTP organized as a Delaware limited partnership combines limited liability and tax advantages with elimination of fiduciary duties and free transferability of shares. In what might be the pinnacle of separation of ownership and control, unitholders purchase limited partnership units on a public exchange representing equity interests in an entity whose managers have no fiduciary duties toward the purchasers or their investment. Furthermore, new proposals seek to expand the universe of firms that may choose this structure, creating interesting, or alarming, questions about the future of this once tiny but now growing population of firms.

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May 18, 2017 in Scholarship, Tax | Permalink | Comments (0)

Wednesday, May 17, 2017

Law School Rankings By Federal Judicial Clerkships

Derek Muller (Pepperdine), Visualizing Law School Federal Judicial Clerkship Placement, 2014-2016:

The release of the latest ABA employment data offers an opportunity to update the three-year federal judicial clerkship placement rates. Here is the clerkship placement rate for the Classes of 2014, 2015, and 2016. Methodology and observations below the interactive visualization. The "placement" is the three-year total placement; the "percentage" is the three-year placement divided by the three-year graduating class total.

Here are the California Law School rankings:

California Ranking

Here are the Top 10 law schools nationally:

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May 17, 2017 in Law School Rankings, Legal Education | Permalink | Comments (2)

Watson:  Rethinking The Pell Program And Federal Tax Incentives For Education

Camilla E. Watson (Georgia), The Future of Lower-Income Students in Higher Education: Rethinking the Pell Program and Federal Tax Incentives:

As the costs of higher education have soared, the value of Pell grants has declined, making it more difficult for lower-income students to obtain an education without being hopelessly mired in debt. This article traces the evolution of the Pell program and discusses the diametrically opposed proposals of Presidents Obama and Trump to reform federal funding for higher education. The article proposes an alternative plan that would require a redirection of a portion of the funds from the Pell program and a reshuffling of the current tax incentives for higher education.

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May 17, 2017 in Scholarship, Tax | Permalink | Comments (0)

Law Students' Character, Rather Than LSATs/UGPAs, Is Best Predictor For Success As Lawyer

Indiana Lawyer, Character Better Predictor of Lawyering Success, Panel Says:

Although Rebecca Love Kourlis sees more collaboration than in the past, she said the gap between the skills the legal profession needs in today’s market and the attorneys law schools are producing is not only widening but will be difficult for legal education to overcome.

Kourlis, retired Colorado Supreme Court justice and executive director of the Institute for the Advancement of the American Legal System, was one of three panelists who participated in a discussion about legal education during the 7th Circuit Bar Association annual meeting and judicial conference April 30-May 2 in Indianapolis.

Joining in the panel discussion, “The Future of Law School,” were Randall Shepard, retired chief justice of the Indiana Supreme Court; and William Henderson, Indiana University Maurer School of Law professor and co-founder of Lawyer Metrics.

The trio highlighted research that has been showing grade point averages and LSAT scores are not the best indicators for future success in the legal profession. Rather, students with character traits like a strong work ethic and emotional stability will be likelier to excel.

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May 17, 2017 | Permalink | Comments (10)

Sanchirico:  Pass-Through, Public Trading, And The Dubious Obstacle Of Inside Basis Adjustments

Chris Sanchirico (Pennsylvania), Pass-Through, Public Trading, and the Dubious Obstacle of Inside Basis Adjustments (web appendix):

Elective “inside basis adjustments” are a central feature of partnership taxation, and their prospective infeasibility for publicly traded companies has played an important role in shaping leading corporate integration proposals.

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May 17, 2017 in Scholarship, Tax | Permalink | Comments (0)

Private College Tuition Discounts Hit All-Time High Of 49%

49%National Association of College and University Business Officers, Private College Tuition Discounts Hit Historic Highs Again:

Private colleges and universities are discounting their tuition revenue at the highest rates yet, a new report from the National Association of College and University Business Officers (NACUBO) shows.

By offering grants, scholarships, and fellowships, the 411 private nonprofit institutions that participated in the 2016 NACUBO Tuition Discounting Study averaged an estimated 49.1 percent institutional tuition discount rate for first-time, full-time students in 2016-17—the highest in the history of the survey. This means that for every dollar in gross tuition revenue from those freshmen, institutions used nearly half for grant-based financial aid. Among all undergraduates, the estimated institutional tuition discount rate was similarly record-setting at 44.2 percent.


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May 17, 2017 in Legal Education | Permalink | Comments (4)

Taylor:  The U.S. Rules For Taxing Business Entities

Florida Tax Review  (2015)Willard Taylor (NYU), Can We Clean This Up? A Brief Journey Through the U.S. Rules for Taxing Business Entities, 19 Fla. Tax Rev. 323 (2016):

This article summarizes the 80-plus year history of the U.S. Federal income tax rules for classifying business entities, concluding that they result largely from administrative and/or legislative reactions to specific problems or legislative accommodations to industry lobbying efforts and do not reflect an effort to develop a comprehensive and coherent system for taxing (or not taxing) business income.

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May 17, 2017 in Scholarship, Tax | Permalink | Comments (0)

Tuesday, May 16, 2017

Non-Elite B-Schools Urge 'Just Say No' Approach To Rankings

US NewsWall Street Journal, Business Schools Take a Stand Against Academic Rankings:

Business-school deans and research faculty at more than 20 universities are taking a stand against the academic rankings published by media outlets such as Bloomberg Businessweek, Nikkei Inc.’s Financial Times and the Economist Group.

Rather than “acquiesce to methods of comparison we know to be fundamentally misleading,” the administrators are urging their peers at other schools to stop participating in a process they say rates programs on an overly narrow set of criteria.

The plea, issued by deans and faculty from institutions including University of Southern California’s Marshall School of Business, University of Iowa’s Tippie College of Business and the University of North Carolina’s Kenan-Flagler Business School, comes in the form of a research paper to be published in the May edition of the Decision Sciences Journal [On Academic Rankings, Unacceptable Methods, and the Social Obligations of Business Schools].

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May 16, 2017 in Law School Rankings, Legal Education | Permalink | Comments (0)

Alice Abreu Receives Temple University's Great Teacher Award

Abreu (2017)Temple Law Professor Alice Abreu Honored with Great Teacher Award:

From the volume of letters offered in support of her nomination, it is clear that Temple Law Professor Alice Abreu has been a Great Teacher for a very long time. On April 25th, Temple University made that official by honoring her with the Great Teacher Award, the highest honor bestowed by Temple upon its faculty.

Temple Law Dean Gregory Mandel took the opportunity to heap praise upon Professor Abreu, tempered with light-hearted teasing for her “boundless and infectious passion for tax law.” “Yes, you heard me correctly,” he confirmed to laughter from the faculty in attendance. “I realize that phrase has never before been uttered.” Mandel went on to describe the “universal admiration of all who know Professor Abreu,” not only for her “zeal for tax law,” but also for her “passion for teaching… and her excitement for drawing colleagues into the intersection of tax law and their practice areas.”

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May 16, 2017 in Legal Education, Tax, Teaching | Permalink | Comments (1)

Chang:  Inequality, Trusts And Estates, And Tax

Felix B. Chang (Cincinnati), Asymmetries in the Generation and Transmission of Wealth,  78 Ohio St. L.J. ___ (2017):

This Article assigns a redistributive role to the legal rules of trusts and estates. Unlike business law, trusts and estates has lagged in articulating a comprehensive theory on inequality. Consequently, income inequality is compounded intergenerationally as wealth inequality, with dire consequences for economic productivity and social stability. To move the discourse on wealth inequality, this Article explores the divergent approaches toward inequality in business law and trusts and estates.

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May 16, 2017 in Scholarship, Tax | Permalink | Comments (2)

Chair Of Legal Ed Section Weighs In On ABA President's Attempt To Strip Non-Accreditation Activities From Section, 'Urban Legend' That Shift To MBE Has Caused Slippage In Bar Exam

ABA Section On Legal Education (2016)Following up on my previous posts (links below):

Greg Murphy (Chair, ABA Section of Legal Education and Admissions to the Bar), The Section Lives, and a Few Words on Bar Admissions and Examiners:

To accomplish the proposed changes in our Section described above, amendments to the ABA Bylaws would have been required. However, the deadline for the submissions of proposals for changes to the ABA Bylaws in advance of the August 2017 annual meeting was March 10, 2017. I am informed that no proposals for amendments relating to our Section were submitted.  Therefore, the first section of the ABA, the Section of Legal Education and Admissions to the Bar, lives on.

Speaking of bar admissions, and since “Admissions to the Bar” is in our Section’s name, many of the readers of Syllabus are already aware that the House of Delegates adopted a resolution urging the bar admitting jurisdictions to adopt expeditiously the Uniform Bar Examination (UBE). The resolution enjoyed the enthusiastic support of the ABA’s Young Lawyers Division and Law Student Division, and passed the House overwhelmingly. Support of the UBE is now official ABA policy. ...

It bears noting that an urban legend seems to persist that recent disappointing bar passage results in some jurisdictions are somehow tied to jurisdictions adopting the UBE.  That is both a legend, and a myth.

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May 16, 2017 in Legal Education | Permalink | Comments (0)

Kleinbard:  Capital Taxation In An Age Of Inequality

Edward Kleinbard (USC), Capital Taxation In An Age Of Inequality, 90 S. Cal. L. Rev. 593 (2017):

The standard view in the U.S. tax law academy remains that capital income taxation is both a poor idea in theory and completely infeasible in practice. But this ignores the first-order importance of political economy issues in the design of tax instruments. The pervasive presence of gifts and bequests renders moot the claim that the results obtained by Atkinson and Stiglitz in 1976 counsel against taxing capital income in practice.

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May 16, 2017 in Scholarship, Tax | Permalink | Comments (1)

Manolakas:  The Mortgage Interest Deduction And Unmarried Co-Owners

Christine Manolakas (McGeorge), Qualified Residence Interest Deduction: A Win for Unmarried Co-Owners, 17 Nev. L.J. 199 (2016):

Despite the seemingly simple language of the statute, the interpretation of the home mortgage interest deduction has recently garnered much attention as the Internal Revenue Service and the courts grappled with its application to unmarried co-owners of a residence.

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May 16, 2017 in Scholarship, Tax | Permalink | Comments (1)

Monday, May 15, 2017

Is The House GOP's Border Adjustment Tax Unconstitutional?

Washington Post op-ed:  If Retail Politics Doesn’t Kill This $1 Trillion Tax, the Supreme Court Should, by Theodore Olson:

“[B]order adjustment” is in serious constitutional jeopardy. As currently described, the tax would be imposed on taxpayers themselves, rather than on a transaction or activity. That makes it a direct tax that should be subject to the long-dormant requirement of apportionment, which the “border adjustment” plan cannot possibly satisfy. If retail politics does not sink “border adjustment,” the Supreme Court should. How pointless to pass an experimental and unfair tax only to have it struck down after all that political capital is spent getting it passed.

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May 15, 2017 | Permalink | Comments (0)

The Downside of Requiring Additional Experiential Courses in Law School

Douglas A. Kahn (Michigan), The Downside of Requiring Additional Experiential Courses in Law School:

In recent years, the bar has expressed dissatisfaction with what is considered by some to be inadequate preparation of law students to begin practicing law immediately after graduation. There are several reasons why this has become a matter of concern for the legal profession. The ABA, state bars and law schools have responded by adopting graduation requirements that force students to take a certain number of experiential courses.

The contention of this article is that the imposition of additional, required experiential courses will have a negative effect on the adequacy of a student's preparation to practice law because it contributes to a reduction in the student's exposure to a range of doctrinal courses (especially core courses) and to the skills that those courses develop.

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May 15, 2017 in Legal Education | Permalink | Comments (21)

Grewal:  Congress Handcuffs The IRS

Andy Grewal (Iowa), The IRS Gets Handcuffed by the Congress, Yale J. on Reg.: Notice & Comment (May 3, 2017):

The House and Senate recently reached agreement on a comprehensive spending bill and expect to pass it soon. Regarding the IRS, the bill freezes the agency’s budget at $11.2 billion and thus does not, as some feared, make substantial cuts to its funding. Nonetheless, the IRS may face hardships, because its funding remains significantly below its 2010 level ($13.6 billion) while its responsibilities have greatly expanded in recent years, especially because of the Affordable Care Act.

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May 15, 2017 in Congressional News, IRS News, Tax | Permalink | Comments (2)

Denver Law School Faces Federal Equal Pay Lawsuit From Eight Female Professors

Denver Logo (2015)Following up on my earlier posts:

Rocky Mountain PBS News, University of Denver Faces Federal Equal Pay Suit from Female Law Professors:

It was a memo from the Dean of the University of Denver law school that Professor Lucy Marsh will never forget. The University said it was paying all female full law professors thousands of dollars less than their male counterparts for doing the same work. “Something had to be done about that,” she said. “That's against the law.”

But when she went to the Dean to protest, asking what he was going to do about the pay disparity?  “He said ‘nothing”, and I thought man I'm not going to take that.”

Marsh and seven of her female colleagues are now cited as examples of violation of the Equal Pay act in an Equal Employment Opportunity Commission suit against the University.  Administration officials say the law professors’ compensation is based on a fair and unbiased evaluation of faculty and that every female full professor in the law school is entitled to less.  The university hired an outside consultant to examine their compensation system.

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May 15, 2017 in Legal Education | Permalink | Comments (3)

Muller:  The Incredible Shrinking Law School

Derek Muller (Pepperdine) has a typically thoughtful post on The Incredible Shrinking Law School, including this chart showing the 27% reduction in the median graduation class size from 2013 (206) to 2016 (161):

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May 15, 2017 in Legal Education | Permalink | Comments (2)

TaxProf Blog Weekend Roundup

Sunday, May 14, 2017

Higher Taxes Lead To Consistently Worse Results In MLB, NBA, NFL, And NHL


New York Times op-ed: Another Terrible Thing About Taxes, by Erik Hembre (University of Illinois at Chicago):

I gathered data on the outcomes of every professional sports game over the past 40 years as well as data on state and local tax rates each team member faces. I then computed how much taxes predict winning for each league in every year while controlling for other factors such as population, income, franchise age and local amenities (i.e., weather).

Results of the analysis [Income Taxes and Team Performance: Do They Matter?] show that higher taxes consistently predict worse performance in every league — not just the N.B.A. but also Major League Baseball, the N.H.L., and the N.F.L. over the past 20 years. The findings do not change if I use championships or finals appearances instead of regular season wins, and no single city, team or year drives the results.

Figure 4

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May 14, 2017 in Tax | Permalink | Comments (6)

Vermont Law School Receives $17m Loan From U.S. Department Of Agriculture To Fund Online Education Program, Restructure Debt

Vermont Law School Logo (2017)ABA Journal, Vermont Law Receives $17 Million Loan From US Department of Agriculture:

Vermont Law School has received a $17 million loan from the United States Department of Agriculture. The loan will be used to restructure debt and further develop an online education program and year-round classes that offer greater flexibility for students. ...

The law school laid off staff in 2013 following a [39%] enrollment decline and in 2014, Moody’s Investors Service downgraded revenue bonds [to junk status] that led to the law school “technically” defaulting on a loan agreement with TD Bank. ...

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May 14, 2017 in Legal Education | Permalink | Comments (7)

The 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, with a new paper debuting on the list at #4:

  1. [430 Downloads]  Background and Current Status of FATCA, by William Byrnes (Texas A&M) & Robert J. Munro (Texas A&M)
  2. [380 Downloads]  House Plan's Bad Math: Over-Estimates of Revenue from a Border Adjustment, by David Kamin (NYU) & Brad Setser (Council on Foreign Relations)
  3. [298 Downloads]  The Offshore Tax Enforcement Dragnet, by Shu-Yi Oei (Tulane)
  4. [225 Downloads]  Should Robots Pay Taxes? Tax Policy in the Age of Automation, by Ryan Abbott (University of Surrey) & Bret N. Bogenschneider (University of Surrey)
  5. [215 Downloads]  BEPS and the New International Tax Order, by Allison Christians (McGill)

May 14, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Religiously Affiliated Law Schools, Olympianism, And Christophobia

Michael V. Hernandez (Dean, Regent), In Defense of Pluralism: Religiously Affiliated Law Schools, Olympianism, and Christophobia, 48 U. Tol. L. Rev. 283 (2017):

Daniel Webster observed that “Christianity, general, tolerant, Christianity, Christianity independent of sects and parties” was the foundation of our liberties and legal system. In the spirit of this tradition, I have explained in my scholarship that the law must zealously guard religious liberty for all, while the substance of law should be based on principles of truth knowable by and accessible to all and not on principles unique to one faith. In other words, a Christian-based jurisprudence does not inherently involve the imposition of uniquely Christian principles and, thus, is not theocratic.

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May 14, 2017 in Legal Education, Scholarship | Permalink | Comments (1)