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Tuesday, March 10, 2015

Senate Holds Hearing Today on Tax Complexity, Compliance, and Administration: The Merits of Simplification in Tax Reform

Senate LogoThe Senate Finance Committee holds a hearing today on Tax Complexity, Compliance, and Administration: The Merits of Simplification in Tax Reform (links to statements and testimony below):

  • Orrin Hatch (R-UT), Statement
  • Ron Wyden (D-OR), Statement
  • Carol Markman (CPA & Tax Director, EP Caine & Associates), Testimony
  • Mihir Desai (Professor, Harvard Law School), Testimony
  • Bruce Bartlett (Former Deputy Assistant Secretary, U.S. Treasury Department), Testimony
  • Keith Fogg (Professor and Tax Clinic Director, Villanova Law School), Testimony

In connection with the hearing, the Joint Committee on Taxation has released Complexity In The Federal Tax System (JCX-49-15):

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March 10, 2015 in Congressional News, Tax | Permalink | Comments (0)

NY Times: Greece Proposes Using Tourists as Tax Spies to Fill Revenue Shortfall

New York Times, Greece Proposes Using Tourists as Tax Spies to Fill Shortfall:

Despite the European accord last month to extend a financial lifeline to Greece, Athens is rapidly running out of cash.

So it is scrambling to find new, even radical ways to fill the shortfall — including a proposal to recruit citizens and tourists to spy on suspected tax evaders. ...

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March 10, 2015 in Tax | Permalink | Comments (0)

Blank: Reconsidering Corporate Tax Privacy

Joshua D. Blank (NYU), Reconsidering Corporate Tax Privacy, 11 N.Y.U. J. L. & Bus. 31 (2014):

For over a century, politicians, government officials and scholars in the United States have debated whether corporate tax returns, which are currently subject to broad tax privacy protections, should be publicly accessible. The ongoing global discussion of base erosion and profit shifting by multinational corporations has generated calls for greater tax transparency. Throughout this debate, participants have focused exclusively on the potential reactions of a corporation’s managers, shareholders and consumers to a corporation’s disclosure of its own tax return information. There is, however, another perspective: how would the ability of a corporation’s stakeholders and agents to observe other corporations’ tax return information affect the corporation’s compliance with the tax law?

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March 10, 2015 in Scholarship, Tax | Permalink | Comments (0)

Law School Funk

March 10, 2015 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 670

IRS Logo 2Washington Times, Hillary Clinton Scandal Spreads as Tea Party Group Seeks Private IRS Emails:

One of the tea party groups targeted by the IRS asked Congress Monday to demand the private emails of some agency employees, while a top committee chairman issued a request for instant-chat messages from the EPA, as the Clinton emails scandal begins to envelop other parts of the Obama administration. ...

One of the tea party groups targeted by the IRS asked Congress Monday to demand the private emails of some agency employees, while a top committee chairman issued a request for instant-chat messages from the EPA, as the Clinton emails scandal begins to envelop other parts of the Obama administration.

Ms. Engelbrecht said in light of the revelation that former Secretary of State Hillary Rodham Clinton used her own private email address and server to conduct official department business, the congressional committees investigating the IRS should pry more deeply into whether any agency employees did the same.

“Former Secretary Clinton’s latest news regarding third-party email use is just a continuation of a thriving culture of concealment within the Obama administration, which is growing increasingly apparent to the American public,” Ms. Engelbrecht said.

Emails from former IRS employee Lois G. Lerner, a central figure in the investigation, have already become a flashpoint in Congress‘ probe into the tax agency, with an inspector general last month saying investigators were quickly able to find backup tapes to restore some of Ms. Lerner’s lost emails, despite the IRS insisting the emails were irretrievably gone.

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March 10, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Monday, March 9, 2015

2016 U.S. News Peer Reputation Rankings (v. Overall Rankings)

2016 U.S. News RankingsContinuing a TaxProf Blog tradition (see links below for 2009-2015), here is the full list of the 198 law schools ranked by academic peer reputation, as well as their overall rank, in the new 2016 U.S. News Law School Rankings (methodology here):

Peer Rank

Peer Score

School

Overall Rank

1

4.8

Yale

1

1

4.8

Harvard

2

1

4.8

Stanford

2

4

4.6

Columbia

4

4

4.6

Chicago

4

6

4.5

NYU

6

7

4.4

Penn

7

7

4.4

UC-Berkeley

8

7

4.4

Michigan

11

10

4.3

Virginia

8

11

4.2

Duke

8

11

4.2

Cornell

13

13

4.1

Northwestern

12

13

4.1

Georgetown

14

15

4.0

Texas

15

16

3.9

UCLA

16

17

3.8

Vanderbilt

17

18

3.5

Washington U.

18

18

3.5

Emory

19

18

3.5

USC

20

21

3.4

Minnesota

20

21

3.4

G. Washington

22

21

3.4

Notre Dame

22

21

3.4

North Carolina

34

25

3.3

Boston University

26

25

3.3

UC-Davis

31

25

3.3

Wisconsin

31

28

3.2

Alabama

22

28

3.2

Iowa

22

28

3.2

William & Mary

29

28

3.2

Boston College

34

28

3.2

Fordham

34

28

3.2

Indiana

34

28

3.2

Ohio State

34

35

3.1

U. Washington

28

35

3.1

Georgia

31

35

3.1

Colorado

40

35

3.1

Illinois

41

35

3.1

Wash. & Lee

42

35

3.1

Florida

47

35

3.1

UC-Hastings

59

42

3.0

Arizona State

26

42

3.0

UC-Irvine

30

42

3.0

Arizona

42

42

3.0

Wake Forest

47

42

3.0

Tulane

50

47

2.9

BYU

34

47

2.9

Maryland

47

47

2.9

Florida State

50

50

2.8

Utah

42

50

2.8

Connecticut

63

50

2.8

American

71

53

2.7

George Mason

42

53

2.7

Miami

63

53

2.7

Denver

67

53

2.7

Cardozo

75

57

2.6

SMU

46

57

2.6

Pepperdine

52

57

2.6

Temple

52

57

2.6

Tennessee

52

57

2.6

Missouri

59

57

2.6

Kansas

67

57

2.6

San Diego

71

57

2.6

Pittsburgh

78

57

2.6

Oregon

82

66

2.5

Richmond

52

66

2.5

Georgia State

56

66

2.5

Case Western

59

66

2.5

Houston

59

66

2.5

Kentucky

63

66

2.5

Loyola-L.A.

75

66

2.5

Brooklyn

78

66

2.5

Chicago-Kent

78

74

2.4

Baylor

56

74

2.4

Nebraska

56

74

2.4

Oklahoma

67

74

2.4

New Mexico

71

74

2.4

Loyola-Chicago

78

74

2.4

Hawaii

82

74

2.4

Rutgers-Newark

87

74

2.4

Lewis & Clark

94

74

2.4

Santa Clara

94

74

2.4

Indiana-Indy

102

74

2.4

Rutgers-Camden

102

85

2.3

Seton Hall

63

85

2.3

UNLV

67

85

2.3

Arkansas

75

85

2.3

Cincinnati

82

85

2.3

Northeastern

87

85

2.3

Villanova

87

85

2.3

Michigan State

94

85

2.3

Mississippi

94

85

2.3

South Carolina

94

85

2.3

Marquette

105

85

2.3

Howard

110

96

2.2

Penn State

71

96

2.2

St. John's

82

96

2.2

St. Louis

87

96

2.2

SUNY-Buffalo

87

96

2.2

Syracuse

87

96

2.2

LSU

94

96

2.2

Maine

110

96

2.2

Seattle

113

96

2.2

DePaul

122

96

2.2

UMKC

127

106

2.1

Louisville

94

106

2.1

West Virginia

94

106

2.1

Stetson

105

106

2.1

Catholic

108

106

2.1

Hofstra

122

106

2.1

Loyola-NO

135

106

2.1

Arkansas-LR

135

106

2.1

San Francisco

138

114

2.0

Wyoming

108

114

2.0

Gonzaga

110

114

2.0

CUNY

113

114

2.0

Mercer

118

114

2.0

Willamette

118

114

2.0

Baltimore

122

114

2.0

Vermont

122

114

2.0

Drexel

127

114

2.0

Idaho

127

123

1.9

Tulsa

82

123

1.9

New Hampshire

87

123

1.9

Wayne State

105

123

1.9

Creighton

113

123

1.9

Drake

113

123

1.9

Montana

113

123

1.9

Quinnipiac

127

123

1.9

Pace

138

123

1.9

North Dakota

138

123

1.9

Texas A&M

149

123

1.9

Southwestern

Tier 2

123

1.9

McGeorge

Tier 2

135

1.8

Texas Tech

118

135

1.8

Washburn

122

135

1.8

Chapman

127

135

1.8

New York L.S.

127

135

1.8

St. Thomas (MN)

135

135

1.8

Memphis

142

135

1.8

William Mitchell

142

135

1.8

South Dakota

145

135

1.8

Suffolk

Tier 2

144

1.7

Florida Int'l

102

144

1.7

Duquesne

118

144

1.7

Cleveland State

127

144

1.7

Akron

127

144

1.7

Albany

138

144

1.7

Toledo

142

144

1.7

Hamline

145

144

1.7

Dayton

145

144

1.7

Cumberland

149

144

1.7

S. Illinois

149

144

1.7

J. Marshall (CHI)

Tier 2

144

1.7

Widener

Tier 2

156

1.6

South Texas

149

156

1.6

Elon

Tier 2

156

1.6

Golden Gate

Tier 2

156

1.6

Mississippi C.

Tier 2

156

1.6

N. Illinois

Tier 2

156

1.6

Roger Williams

Tier 2

156

1.6

St. Mary's

Tier 2

156

1.6

Valparaiso

Tier 2

164

1.5

Ohio Northern

145

164

1.5

Oklahoma City

149

164

1.5

Cal-Western

Tier 2

164

1.5

Campbell

Tier 2

164

1.5

New England

Tier 2

164

1.5

N. Kentucky

Tier 2

164

1.5

Nova

Tier 2

164

1.5

Touro

Tier 2

164

1.5

Puerto Rico

Tier 2

173

1.4

Capital

Tier 2

173

1.4

N.C. Central

Tier 2

173

1.4

Southern

Tier 2

173

1.4

St. Thomas (FL)

Tier 2

173

1.4

Texas Southern

Tier 2

173

1.4

Detroit Mercy

Tier 2

173

1.4

Dist. of Columbia

Tier 2

173

1.4

W. New England

Tier 2

173

1.4

Whittier

Tier 2

182

1.3

J. Marshall (ATL)

Tier 2

182

1.3

Faulkner

Tier 2

182

1.3

Florida A&M

Tier 2

182

1.3

Inter-Americana

Tier 2

182

1.3

Pontifical Catholic

Tier 2

182

1.3

Regent

Tier 2

182

1.3

Thomas Jefferson

Tier 2

189

1.2

Appalachian

Tier 2

189

1.2

Barry

Tier 2

189

1.2

Charleston

Tier 2

189

1.2

Charlotte

Tier 2

189

1.2

Florida Coastal

Tier 2

189

1.2

Liberty

Tier 2

195

1.1

Arizona Summit

Tier 2

195

1.1

Ave Maria

Tier 2

195

1.1

W. Mich. Cooley

Tier 2

195

1.1

Western State

Tier 2

Prior years' rankings:

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March 9, 2015 in Law School Rankings, Legal Education | Permalink | Comments (5)

Brown: Law Schools Are in a Death Spiral

Brown (Dorothy) (2015)Washington Post:  Law Schools Are in a Death Spiral. Maybe Now They’ll Finally Change., by Dorothy Brown (Vice Provost and Professor of Law, Emory):

“March madness” holds a different meaning in the legal world. While most of the country looks forward to fast breaks and Cinderella upsets, law schools are bracing themselves for another type of madness: the annual carnage left by the US News & World Report rankings. ...

No law school has figured out how to handle the new normal of legal education: the lowest number of applicants in four decades; fewer legal jobs for graduates; and, according to Moody’s, “no relief in sight.”

While some argue that going to law school is still a safe bet, little evidence exists to support this position. The most elite law schools — the top 1 percent —  will thrive. The other 99 percent: not so much. ...

While law firms can fire lawyers, law schools cannot cut their largest expense: faculty. Most faculty have tenure, which equals lifetime job protection — as long as the school remains open. While faculty could be part of the solution to legal education’s woes, we are actually the problem.

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March 9, 2015 in Legal Education | Permalink | Comments (0)

Hellwig Presents The Constitutional Nature of the U.S. Tax Court Today at Indiana

HellwigBrant Hellwig (Dean (as of July 1, 2015), Washington & Lee) presents The Constitutional Nature of the United States Tax Court at Indiana today as part of its Tax Policy Colloquium hosted by Leandra Lederman:

Is the United States Tax Court part of the Executive Branch of Government? One would expect that question would be capable of being definitively answered without considerable difficulty. And as recently expressed by the Court of Appeals for the District of Columbia Circuit, that indeed is the case. In the course of addressing a challenge to the ability of the President to remove a judge of the Tax Court for cause on separation of powers grounds, the D.C. Circuit rejected the premise that the removal power implicated two branches of government: “The Tax Court exercises Executive authority as part of the Executive Branch.” [Kuretski v. Commissioner]

This article will examine the Kuretski decision, using this case as a vehicle to examine the constitutional nature of the Tax Court.

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March 9, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Elizabeth Chamblee Burch, Michael Simkovic Awarded ALI Young Scholars Medals

BurchThe American Law Institute Announces Young Scholars Medal Recipients:

The American Law Institute has announced that the Young Scholars Medal will be awarded this year to two exceptional law professors— Elizabeth Chamblee Burch of the University of Georgia School of Law and Michael Simkovic of Seton Hall University School of Law. The award is presented every other year to one or two outstanding early-career law professors whose work has the potential to influence improvements in the law.

Justice Goodwin Liu of the California Supreme Court, who chairs of the Young Scholars Medal Selection Committee, will present the awards on Monday, May 18, at the ALI Annual Meeting in Washington, DC. "We are extremely proud of this year’s Medal recipients," said Justice Liu. “These two exceptional professors have produced first-rate scholarship that is already having an impact in legal debate and policy. Professor Burch’s work provides an innovative analysis of strategies for solving principal-agent problems in aggregate litigation, and Professor Simkovic's research on consumer finance and credit markets has influenced courts, regulators, fellow researchers, and the United States Congress.”

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March 9, 2015 in Legal Education, Scholarship, Tax | Permalink | Comments (0)

Symposium on The Role of the Associate Dean for Research

Symposium, Perspectives From an Associate Dean: Scholarship and School Visibility, 31 Touro L. Rev. 15-74 (2015):

Patricia Salkin (Dean, Touro), Associate Dean for Research & Scholarship Symposium Offers Perspectives on Engaged Scholarship and the Changing Definition of Scholarly Work:

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March 9, 2015 in Legal Education, Scholarship | Permalink | Comments (0)

Listokin: Tax Expenditure Estimates Approximate Revenue Estimates

Yair Listokin (Yale), Tax Expenditure Estimates Approximate Revenue Estimates, 145 Tax Notes 701 (Nov. 10, 2014):

Tax expenditure estimates are viewed with skepticism even within the fraught business of forecasting the revenue effects of policies. As the Joint Committee on Taxation emphasizes, ‘‘Unlike revenue estimates, tax expenditure estimates do not incorporate any behavioral response of taxpayers or changes in the timing of tax payments.

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March 9, 2015 in Scholarship, Tax | Permalink | Comments (1)

The Law Schools That Most Goosed Their U.S. News Ranking With School-Funded Jobs

Following up on yesterday's post, ABA May Prohibit Reporting Law School-Funded Jobs as Full-Time, Long-Term Bar Passage-Required Jobs:  Robert R. Kuehn (Washington University) passed along this chart (from ABA data for the Class of 2013) of the 38 law schools that boosted their full-time, long-term reported numbers by 2% or more through school funded jobs:

Law School

# Employed    Bar Passage Required FTLT

# Funded Bar Passage Required FTLT

% Funded Bar Passage Required FTLT

1.   WILLIAM & MARY

166

43

25.90%

2.   EMORY

244

62

25.41%

3.   GEORGE WASHINGTON

469

88

18.76%

4.   VIRGINIA

348

58

16.67%

5.   AMERICAN

231

37

16.02%

6.   GEORGETOWN

540

73

13.52%

7.   UCLA

252

31

12.30%

8.   ILLINOIS

168

20

11.90%

9.   LEWIS & CLARK

144

15

10.42%

10. UMASS

29

3

10.34%

11. UC-BERKELEY

261

25

9.58%

12. VANDERBILT

178

17

9.55%

13. CORNELL

173

16

9.25%

14. BOSTON UNIVERSITY

187

17

9.09%

15. NYU

505

42

8.32%

16. MARYLAND

152

12

7.89%

17. UC-DAVIS

138

10

7.25%

18. COLUMBIA

415

29

6.99%

19. CHICAGO

199

13

6.53%

20. USC

154

10

6.49%

21. CHARLOTTE

129

8

6.20%

22. YALE

160

9

5.63%

23. PENNSYLVANIA

235

13

5.53%

24. PACE

122

6

4.92%

25. DISTRICT OF COLUMBIA

21

1

4.76%

26. COLORADO

123

5

4.07%

27. TEXAS

296

12

4.05%

28. HAWAII

53

2

3.77%

29. RUTGERS-NEWARK

151

5

3.31%

30. GEORGE MASON

129

4

3.10%

31. LIBERTY

33

1

3.03%

32. TULSA

67

2

2.99%

33. STANFORD

170

5

2.94%

34. MINNESOTA

192

5

2.60%

35. ARIZONA SUMMIT

126

3

2.38%

36. NORTHWESTERN

225

5

2.22%

37. PITTSBURGH

135

3

2.22%

38. HARVARD

505

11

2.18%

Placement data counts 20% in the U.S. News Law School Rankings Methodology.  Prior TaxProf Blog coverage:

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March 9, 2015 in Law School Rankings, Legal Education | Permalink | Comments (6)

Johnson: How Far Does Circular 230 Exceed Treasury's Statutory Authority?

Steve Johnson (Florida State), How Far Does Circular 230 Exceed Treasury's Statutory Authority?, 146 Tax Notes 221 (Jan. 12, 2015):

Treasury regulations defining the duties of those practicing before the IRS, commonly called Circular 230, are a cornerstone of federal tax practice. Recent judicial decisions, however, raise the genuine possibility that substantial portions of Circular 230 may be invalidated if challenged. 

March 9, 2015 in Scholarship, Tax | Permalink | Comments (0)

Kahn & Kahn: Cancellation of Debt and Related Transactions

Douglas A. Kahn (Michigan) & Jeffrey H. Kahn (Florida State), Cancellation of Debt and Related Transactions, 68 Tax Law. ___  (2015):

If a taxpayer borrows money, the borrowed funds are not included in the taxpayer’s gross income. That treatment is proper even though the taxpayer has increased his assets by the amount he borrowed since he has also has created a corresponding liability to pay back the loan. The taxpayer’s net wealth has not increased. The more difficult and interesting questions arise when the taxpayer fails to repay the loan. At first blush, it would appear that upon cancellation of a loan, the taxpayer should have income for the amount that was canceled. However, the current tax treatment that simple. A number of exceptions exist to the straightforward treatment under which the cancellation requires the taxpayer to recognize income. Some of those exceptions reflect an application of normal tax principles while others exist for programmatic purposes. Those exceptions make the tax treatment of cancellation of debt particularly complex.

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March 9, 2015 in Scholarship, Tax | Permalink | Comments (1)

The IRS Scandal, Day 669

IRS Logo 2Forbes, Lois Lerner Out From Under Freedom Path Lawsuit For Now, by Peter J. Reilly:

Lois Lerner might have had a bit of a breathing spell for a couple of days before the announcements about more e-mails being found.  It was so short that it has largely been missed, but since I am playing catch-up I noticed it.  Lerner’s brief reprieve was the work of Judge Sidney Fitzwater, a Reagan appointee, of the District Court for the Northern District of Texas.  Judge Fitzwater’s decision in Freedom Path Inc v Lois Lerner et al at least gets Lois Lerner out from under one lawsuit. Freedom Path was suing Lois Lerner, unnamed officials of the IRS, the IRS and the United States.  The suit was about targeting FP due to its conservative views as it was applying for exempt status, illegally releasing information about FP and the general use of a “facts and circumstances” test in the IRS evaluation of political activities. Freedom Path complained in its lawsuit about the slow pace of its application and additional intrusive questions.  Also a copy of its application (Form 1024) was released to ProPublica.  On the application FP had indicated that it would not be engaging in political activity.  ProPublica released a story Controversial Dark Money Group Among Five That Told IRS They Would Stay Out of Politics, Then Didn’t that mentioned Freedom Path as one of the five. In April 2013 Freedom Path was asked for further information, which it was hesitant to release because of the disclosure to ProPublica.  The IRS then offered FP the opportunity to enter into a new expedited process, but that did not work for them.

Under this process, Freedom Path could obtain approval of its pending application if it made certain representations regarding the organization’s past, current, and future spending on political activities. Freedom Path alleges that it declined to participate in this optional expedited process because it viewed the required representations as unconstitutionally broad and as an IRS attempt to force Freedom Path to relinquish some of its First Amendment rights.

Lois Lerner Not A Texan The reason that Lois Lerner was dismissed from the suit is one that her supporters, if there are any, might not find very satisfying.  Her detractors, who are legion, will probably find it infuriating.  She was dismissed, because she does not have enough connection with Texas which is where the suit was brought (although in a federal court).

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March 9, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

TaxProf Blog Weekend Roundup

Sunday, March 8, 2015

ABA May Prohibit Reporting Law School-Funded Jobs as Full-Time, Long-Term Bar Passage-Required Jobs

ABA Logo 2The Data Policy and Collection Committee (chaired by Stetson Dean (and Tax Prof) Christopher Petruszkiewicz) of the ABA Section of Legal Education and Admission to the Bar has proposed prohibiting the reporting of law school-funded jobs as full-time, long-term bar passage-required jobs:

The reporting of law graduate employment outcomes is governed by Standard 509 of the ABA Standards for Approval of Law Schools. Standard 509(a) provides that “[a]ll information that a law school reports, publicizes, or distributes shall be complete accurate and not misleading to a reasonable law school student or applicant.” Standard 509(b) further provides that “[a] law school shall publicly disclose on its website, in the form and manner and for the time frame designated by the Council the following information: . . . (7) employment outcomes”.

The Data Policy and Collection Committee (Committee) considered how positions funded by law schools after graduation are classified by law schools and reported under Standard 509. Some law schools provide jobs for some of their graduates. The form of these jobs varies. In some cases, they are fellowships in public interest settings; in other cases, they are jobs doing research at the law school; and they can take other forms. Such positions generally have certain important features in common: the law school pays the graduates, directly or indirectly, and the jobs are temporary (they typically last up to a year, or very slightly longer). The question addressed by this memorandum is how these positions should be reported by the law schools to the ABA, and by the ABA and law schools to prospective students and other members of the public.

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March 8, 2015 in Legal Education | Permalink | Comments (2)

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 #4 and #5:

  1. [320 Downloads]  Why Corporate Tax Reform Can Happen, by Edward Kleinbard (USC)
  2. [201 Downloads]  David Foster Wallace on Tax Policy, How to Be an Adult, and Other Mysteries of the Universe, by Arthur J. Cockfield (Queen's University)
  3. [173 Downloads]  Fiscally Transparent Entities: Eligibility for Tax Treaty Benefits, by Sumeet Khurana & Ashish Karundia
  4. [151 Downloads]  The Distributive Deficit in Law and Economics, by Lee Fennell (University of Chicago) & Richard McAdams (University of Chicago)
  5. [141 Downloads]  Inevitable: Sports Gambling, State Regulation, and the Pursuit of Revenue, by Anastasios Kaburakis (St. Louis), Ryan Rodenberg (Florida State) & John Holden (Florida State)

March 8, 2015 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

An Online Kingdom: How Liberty U. Became a Model for the Future of Higher Education With Pervasive Christian Faith and Marketing, No Faculty Tenure

Liberty Logo

Chronicle of Higher Education, An Online Kingdom Come: How Liberty U. Became an Unexpected Model for the Future of Higher Education:

Maybe Jerry Falwell was right. The late evangelist always figured that most people would dismiss anything that started in this little city, where he founded Liberty University. ...

More than four decades after Liberty’s founding, in 1971, few in higher education would count the Rev. Falwell among academe’s historic visionaries. But college leaders, grappling with how to position their institutions for the future, might want to take a closer look at the legacy of Mr. Falwell, who is often better remembered for his divisive reputation as a firebrand conservative.

The little experiment that Mr. Falwell started in his hometown is a pretty big deal now, and the residential campus here does not begin to tell the story. Liberty’s online program boasts nearly 65,000 students, more than any other nonprofit college in the United States, according to federal data. Only the University of Phoenix, the for-profit behemoth with an enrollment of 207,000, trumps Liberty.

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March 8, 2015 in Legal Education | Permalink | Comments (2)

The IRS Scandal, Day 668

IRS Logo 2Midland Daily News editorial,  IRS Scandal Continues to Grow:

So, why is there so little interest in the IRS scandal?

This story has been gathering steam in terms of facts being revealed, but so far the major news outlets are showing little, if no interest, in covering the details.

Here’s what’s happened just recently:

  • One high-ranking government official said that there is “potential criminal activity” involved in the disappearance and hiding of emails belonging to IRS officials involved in the targeting of conservatives between 2010 and 2012.
  • Despite IRS Commissioner John Koskinen repeatedly saying under oath in previous Congressional hearings that Lois Lerner’s emails could not be recovered, investigators have been successful in recovering nearly 33,000 emails relevant to the IRS investigation. ...

Long-time political columnist George Will said on a talk show in February that the IRS scandal is as big as Watergate or the Iran-Contra scandal. He then asked, “so where’s the media?”

We are wondering the same thing. Getting to the truth — and holding our government officials accountable for their words and actions — should be a top priority for the press and for all Americans.

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March 8, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, March 7, 2015

ABA May Replace Mandatory Reporting of 25th, 50th & 75th Percentile UGPAs & LSAT Scores With Granular Grid

ABA Logo 2The Data Policy and Collection Committee (chaired by Stetson Dean (and Tax Prof) Christopher Petruszkiewicz) of the ABA Section of Legal Education and Admission to the Bar has proposed replacing the current requirement that law schools report their 25th, 50th, and 75th percentile UGPAs and LSAT scores with a more granular grid that reports UGPAs and LSAT scores in bands:

At its upcoming meeting, the Data Policy and Collection Committee (Committee) will consider possible changes in the reporting of admissions data and entering class credentials (LSAT scores and UGPAs) pursuant to Standard 509 of the ABA Standards for Approval of Law Schools. The Committee is considering replacing the current reporting format, which requires schools to report 25th, 50th, and 75th percentile UGPAs and LSAT scores, with a more granular grid that reports UGPAs and LSAT scores in bands. Any changes will require approval of the Council of the Section of Legal Education and Admissions to the Bar (Council) upon recommendation of the Committee.

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March 7, 2015 in Legal Education | Permalink | Comments (2)

Former IRS Commissioner Mark Everson Enters the 2016 Presidential Race

Everson for President

Former IRS Commissioner (2003-2007) Mark Everson has announced in this Letter to America that he is running for President:

Mr. Everson will have to overcome a tawdry sex scandal that resulted in his firing from his position as President and CEO of the American Red Cross:

Press and blogosphere coverage of Mr. Everson's nascent presidential campaign:

(Hat Tip: Evelyn Brody.)

March 7, 2015 in IRS News, Tax | Permalink | Comments (5)

How Men Can Succeed in the Boardroom and the Bedroom: Choreplay

ChoreplayNew York Times:  How Men Can Succeed in the Boardroom and the Bedroom, by Sheryl Sandberg (Facebook) & Adam Grant (Wharton):

It's easy to see how women benefit from equality — more leadership positions, better pay at work and more support at home. Men may fear that as women do better, they will do worse. But the surprising truth is that equality is good for men, too.

If men want to make their work teams successful, one of the best steps they can take is to bring on more women. ...

In a previous article, we highlighted why men ought to share the “office housework” — taking notes, planning meetings and helping others. Doing more actual housework matters, too. Research shows that when men do their share of chores, their partners are happier and less depressed, conflicts are fewer, and divorce rates are lower. They live longer, too; studies demonstrate that there’s a longevity boost for men (and women) who provide care and emotional support to their partners later in life.

If that isn’t exciting enough, try this: Couples who share chores equally have more sex. As the researchers Constance T. Gager and Scott T. Yabiku put it, men and women who work hard play hard. One of us, Sheryl, has advised men that if they want to do something nice for their partners, instead of buying flowers, they should do laundry. A man who heard this was asked by his wife one night to do a load of laundry. He picked up the basket and asked hopefully, “Is this Lean In laundry?” Choreplay is real.

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March 7, 2015 in Legal Education, Tax | Permalink | Comments (3)

The IRS Scandal, Day 667

IRS Logo 2Forbes, Finally, Suing IRS Over All Those Emails, by Robert W. Wood:

Whatever your political views, it is worth reading the press release by Judicial Watch about its latest lawsuit against the IRS. You have to be a kind of Energizer Bunny to keep after the dog-ate-my-homework targeting scandal. Like President Obama, some insist there was not a smidgen of corruption at the IRS. Others aren’t so sure.

The latest Freedom of Information Act lawsuit seeks “any and all records related to the destruction of damaged hard drives from IRS employee computers from January 1, 2010, to the present.” The suit was filed in federal court, Judicial Watch v. Internal Revenue Service. Interestingly, the lawsuit was filed even before the latest Hearings of the Committee on Oversight & Government Reform. On February 26, 2015, the Treasury Inspector General said he is investigating possible criminal activity at the IRS. The most disturbing revelation was that the IRS had not even asked for the backup tapes when the ‘hard drive crash’ excuse was first used. If true, that sounds like a game-changer.

After all, IRS Commissioner John Koskinen testified that recovery efforts had been thorough, and the tapes and emails couldn’t be found. Remember all the millions and millions in taxpayer money spent looking? One report said over 250 IRS employees spend 100,000 hours, costing taxpayers at least $14 million. Mr. Koskinen has been characterized as a political fixer who, unlike most IRS Commissioners, has not had a career in the tax industry.

He may want to explain all the multi-million dollar recovery efforts, particularly if somehow they did not include some simple questions! In the meantime, the IRS statements in briefs in the Judicial Watch case showcase what is hard to see as anything but obstruction. The IRS has said repeatedly that “records that pertain to the destruction of damaged hard drives are not maintained in a searchable manner.” The IRS has denied multiple requests, leading to multiple suits. ...

IRS attorneys said the back-up system would be too onerous to search. Yet in recent testimony, the Treasury Inspector General for Tax Administration said IRS tech employees told them that IRS management never asked for the tapes.

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March 7, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, March 6, 2015

Kysar Presents Interpreting Tax Treaties Today at Virginia

KysarRebecca Kysar (Brooklyn) presents Interpreting Tax Treaties at Virginia today as part of its Faculty Workshop Series:

The circumstances, if any, that permit a non-uniform, or differentiated, approach to treaty interpretation are difficult to define. Generally, a differentiated approach stands in tension with the Vienna Convention’s rules of interpretation, which apply to all treaties. Yet the notion that some treaties warrant special interpretive rules is also widely accepted by courts, states, and scholars. Thus far, however, efforts to justify differentiated treaty interpretation based on subject matter or treaty purpose have proven inadequate. A more promising avenue is the examination of the objective characteristics shared within a treaty type. One such characteristic, I contend, is the treaty’s degree of completeness. Specifically, all else being equal, standalone instruments call for less reliance upon extrinsic materials; interstitial instruments demand more.

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March 6, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

Weekly Student Tax Note Roundup

Number of LSAT Test-Takers, Law School Applicants at 30+ Year Lows

LSAC has announced that it administered 101,689 LSATs in 2014-15, a 3.6% decline from the prior year and the lowest amount in the 27 years that the LSAC has been releasing this information:

LSAC

LSAC also has announced that "as of 2/27/15, there are 247,698 fall 2015 applications submitted by 36,120 applicants. Applicants are down 6.9% and applications are down 8.7% from 2014. Last year at this time, we had 71% of the preliminary final applicant count."

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March 6, 2015 in Legal Education | Permalink | Comments (6)

Sweet Briar College to Close; Who Gets the $80 Million Endowment?

SweetInside Higher Ed, Who Gets the Endowment:

Sweet Briar College’s closure seems all the more stunning given how much money it has socked away: more than $80 million in its endowment.

The women’s college in rural Virginia announced this week it would close at the end of the spring semester. The move seemed designed to preempt the sort of death spiral other small private colleges have fallen into, fighting to stay alive until they default on their debts, falling behind on their bills and having creditors at their door.

Sweet Briar looks like it may go out with such a fight. Yet it still could need a while to sort through its affairs and divvy up what it has left to divvy up, according to financial experts. Because most colleges that close have run out of all of their cash, there is no endowment to divide up. But within hours of Sweet Briar's announcement Tuesday, alumnae and higher education observers started posting comments to social media asking who would get the leftover funds.

Some of the money will have to be used to pay bills, other money may perhaps be given back to donors and yet other funds may be redirected to other charitable causes.

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March 6, 2015 in Legal Education | Permalink | Comments (3)

L.A. Times: Classroom Technology Bans Improve Student Performance

GadgetLos Angeles Times, Classes That Go Off the Grid Help Students Focus:

USC professor Geoffrey Cowan is a scholar of free speech and communication. But Cowan, the former dean of the Annenberg School for Communication and Journalism, insists that students sometimes should be cut off from the social media and websites that are so prevalent in their lives.

Cowan bans the use of laptops, cellphones and wireless devices during the freshman introductory class "The Changing World of Communication and Journalism" that he co-teaches in the fall with current Annenberg Dean Ernest J. Wilson III. Like a growing number of professors nationwide, the USC professors say that electronic equipment, even just for note taking, causes students to mentally disconnect from lectures and distracts them from class discussions.

The sneaky, or sometimes brazen, texting, Web surfing and Facebook browsing disrupts the teaching and learning environment, they say.

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March 6, 2015 in Legal Education, Teaching | Permalink | Comments (0)

Barnhizer: The Declining Scale of the ‘Law School Industry’

David Barnhizer (Cleveland State), The Declining Scale of the ‘Law School Industry’:

Law Professors Are Academia’s 1 Percent!
This analysis is less about law schools than about the trends occurring outside law schools as in the changing conditions of the legal profession, the delivery of legal services and “law knowledge,” and in the economic climate within which lawyers and clients function. These changes have far more to do with the effects of those external conditions and needs on the future of law schools than the very limited steps that can be taken by law schools to mitigate the consequences of the ongoing “crisis” whether those steps relate to individual law schools or the overall “law school industry.” Of course an initial mea culpa is in order because the law schools contributed to the situation by their gross overproduction of new law graduates over the past twenty five years without asking whether there should be limits to the “high pressure stream” of new lawyers they were injecting into the legal profession on levels that that far exceeded the profession’s ability to assimilate the output.

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March 6, 2015 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 666

IRS Logo 2The Fiscal Times, Hillary Clinton Is the Republicans’ Newer, Bigger Lois Lerner:

Clinton has morphed into a hybrid of everything Republicans deplore about the Clintons, reminiscent of the conduct of IRS official Lois Lerner.

Many in the conservative movement smelled an administration plot to suppress Republican activists during the 2012 presidential election, and when Lerner famously refused to testify before Congress, she only cemented that perception. But the real reason conservatives have never let go of Lerner is her emails. The IRS claimed that Lerner and six other employees’ official IRS computers suffered hard drive crashes that rendered much of the information on it unrecoverable. It was impossible, therefore, for the IRS to credibly claim that it had turned over all relevant emails involving Lerner to Congressional committees investigating the targeting of non-profit groups. In fact, Lerner emails are still being uncovered.

A similar search for Clinton’s emails was launched Wednesday, when Rep. Trey Gowdy (R-SC), the chairman of the House Select Committee that is investigating the attack on the U.S. diplomatic compound in Benghazi, Libya in September 2012, announced that his committee would subpoena Clinton’s emails. ...

Clinton’s situation is arguably worse that Lerner’s because the wound is completely self-inflicted. At the time Lerner’s computer failed, the agency claimed that the back-up system they did have only kept data for 6 months before overwriting the digital tapes. IRS workers, including Lerner, were expected to identify all the emails they sent or received that could be classified as a “federal record” and to print out hard copies.

In fact, the records were backed up, and investigators were able to recover more than 30,000 emails as well as tapes from servers within two weeks dating back to 2001. As a result, the possibility of criminal activity is being probed by the Treasury Inspector General for Tax Administration.

Nevertheless, the procedure in place at the IRS left open the possibility that an employee guilty of wrongdoing might simply decline to save incriminating emails in hard copy. Taking things a step further – as many conspiracy-minded commentators did – one can imagine a staged hard drive “crash” that permanently eliminates evidence.

There is no evidence to suggest that Lerner was derelict in observing the rules on record retention, and certainly none to suggest that she engineered a fake hard drive crash. But you can’t prove a negative, and the system in place at IRS, making Lerner the arbiter of what was and was not a federal record, left ample room for doubt that there had been a cover up.

While the conditions that created doubt about Lerner’s emails were largely the fault of the IRS’s internal systems, Hillary Clinton has no such defense. She could have used the official email system, which archives messages. Her successor, John Kerry, does just that. But she didn’t.

Putting aside the apparent risk of placing all of her official communications outside the protection of the secure State Department email system (a major issue according to this Bloomberg report), the decision effectively put Clinton in the same position that IRS rules created for Lerner. It made her the arbiter of what emails were and were not considered public records.

  • The American Spectator, If David Petraeus Were Hillary Clinton:  "Think Lois Lerner with a server in her basement and what would have happened if Lerner and Lerner alone had 100% control on who saw her e-mails and which would or would not be erased as investigators closed in."
  • Town Hall, White House Squirms Over Hillary's Email Scandal, Forgets Embrace of Regular Law Breaking:  "Former head of tax exempt groups at the IRS Lois Lerner, who was a key player in targeting conservatives between 2010 and 2012, used a personal email account to conduct official government business. "Through the course of the investigation, we have learned that you sent documents related to your official dendrites from your official IRS e-mail account to an msn.com e-mail account labeled 'Lois Home.' This raises some serious questions concerning your use of a non-official e-mail account to conduct official business. Accordingly, we write to request documents related to your official duties that are housed in non-official e-mail accounts," former Chairman of the House Oversight Committee Darrell Issa and former Subcommittee Chairman Jim Jordan sent in a letter to Lerner last year. "The use of non-official e-mail accounts to conduct official business implicates federal records requirements. Use of a non-official e-mail account to conduct government business raises the prospect that records -- as defined by the Federal Records Act -- are not captured by official government e-mail archiving systems. It also creates difficulties in fulfilling the IRS' obligations under the Freedom of Information Act and other litigation requests. You use of non-official e-mail account also frustrates congressional oversight obligations." Are we really surprised she plead the fifth?"

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March 6, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Thursday, March 5, 2015

Prasad Presents Starving the Beast: The 1981 Reagan Tax Cut Today at UCLA

PrasadMonica Prasad (Northwestern) presents Starving the Beast: The 1981 Reagan Tax Cut at UCLA today as part of its Colloquium on Tax Policy and Public Finance hosted by Jason Oh and Alexander Wu:

The debt when Reagan entered office was just over $900 billion, not historically high in constant dollars or as a percent of GDP, but by the time Reagan left office it had almost tripled in nominal terms, and in percent of GDP it had gone from 33.4 percent to 51.9 percent. At the end of his term, the debt stood at $2.6 trillion, with a substantial portion of it contributed by Reagan's own policies: a mountain over 160 miles high in loose or tight bricks.

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March 5, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (4)

Kysar Presents Interpreting Tax Treaties at Harvard

KysarRebecca Kysar (Brooklyn) presented Interpreting Tax Treaties at Harvard yesterday as part of its Tax Law, Policy and Practice Workshop Series hosted by Daniel Halperin and Stephen Shay:

The circumstances, if any, that permit a non-uniform, or differentiated, approach to treaty interpretation are difficult to define. Generally, a differentiated approach stands in tension with the Vienna Convention’s rules of interpretation, which apply to all treaties. Yet the notion that some treaties warrant special interpretive rules is also widely accepted by courts, states, and scholars. Thus far, however, efforts to justify differentiated treaty interpretation based on subject matter or treaty purpose have proven inadequate. A more promising avenue is the examination of the objective characteristics shared within a treaty type. One such characteristic, I contend, is the treaty’s degree of completeness. Specifically, all else being equal, standalone instruments call for less reliance upon extrinsic materials; interstitial instruments demand more.

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March 5, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Hickman Presents Treasury's Retroactivity Today at Iowa

Hickman 2014 2Kristin Hickman (Minnesota) presents Treasury's Retroactivity at Iowa today as part of its Faculty Workshop Series:

In Bowen v. Georgetown University Hospital, the Supreme Court described retroactivity as "not favored in the law" and generally rejected allowing federal administrative agencies to adopt regulations "altering the past legal consequences of past actions."  Unlike most regulatory agencies, Treasury and the IRS are expressly authorized by Congress to adopt regulations with precisely such primary retroactive effect.  Specifically, IRC § 7805(b) grants Treasury and the IRS the power to backdate tax regulations under a variety of circumstances.  Preliminary analysis shows that Treasury and the IRS utilize this authority regularly with little judicial oversight for abuse of discretion.  Using empirical data, this article will explore more fully Treasury and IRS utilization of the authority to adopt retroactively effective regulations interpreting the Internal Revenue Code.

March 5, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Law School Applicants From Top Colleges Plunge 39%

Associate's Mind has updated its 2013 and 2014 posts and found that law school applicants from graduates of the Ivy league plus Chicago, Duke, and Stanford have plunged 39% since 2008 (click on chart to enlarge):

Top University Students Avoiding Law School 2015 Edition
Change From 2008 to 2014

AM 2

March 5, 2015 in Legal Education | Permalink | Comments (5)

WSJ: Is It Fair to Tax Capital Gains at Lower Rates Than Earned Income?

Wall Street Journal, Is It Fair to Tax Capital Gains at Lower Rates Than Earned Income?:

Capital gains—and how big a bite the government should take out of them—have become a major point of contention in the past couple of months.

In January, President Obama proposed tax changes designed to raise some $320 billion over 10 years, largely through higher levies on high-income Americans. The revenue would be used to cover $235 billion in tax breaks, mostly for moderate-income workers, along with other initiatives.

Among the changes he proposed: boosting the capital-gains rate to 28% for the top 1% of taxpayers, up from the current 23.8%, as well as a new capital-gains tax on many inheritances.

The GOP fired back that taxing investment income would harm economic growth by discouraging business investment and thereby hurt workers’ incomes.

All of which points to a broader question that divides experts: Are capital gains so different from earned income that they should be taxed at a different rate?

Below, two experts tackle that question.

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March 5, 2015 in Tax | Permalink | Comments (2)

NALP: Law Grad Hiring 'Increased Measurably' in 2014

NALP New LogoNALP, Entry-level Law Firm Recruiting Ticks Up:

Six years after the Great Recession, entry-level law firm recruiting activity increased measurably in the summer and fall of 2014. While law firms continue to exercise cautious entry-level hiring, recruiting activity by U.S. law firms on the campuses of U.S. law schools increased during the most recent recruiting season compared with recruiting activity the year before. Over the last five years law firms have gradually increased their entry-level hiring activity after the collapse in entry level hiring reflected by the data from 2008 and 2009. ...

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March 5, 2015 in Legal Education | Permalink | Comments (3)

Georgetown Lateral Hires: Lilian Faulhaber (From BU), Brian Galle (From BC)

Georgetown Law School, Tax Scholars Join Georgetown Law Faculty:

Georgetown University Law Center is pleased to announce that tax scholars Lilian V. Faulhaber and Brian Galle will be joining the Law Center faculty next year. ...

Faulhaber (2016)Faulhaber joins Georgetown Law from Boston University School of Law. Since 2013, she has worked at the Organisation for Economic Co-operation and Development, where she is an adviser to the Base Erosion and Profit Shifting Project. Before joining the Boston University faculty, she was a Climenko Fellow and Lecturer on Law at Harvard Law School. Her research and teaching interests include international tax law, federal income tax law, tax policy, European Union law and international law.  She clerked for Senior Judge Robert E. Keeton and Judge William G. Young, both on the U.S. District Court for the District of Massachusetts, and was an associate at Cleary Gottlieb Steen & Hamilton LLP in New York. A graduate of Harvard College, she received an M.Phil. from Cambridge University and a J.D. from Harvard Law School, where she was editor-in-chief of the Harvard International Law Journal

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March 5, 2015 in Legal Education, Tax, Tax Prof Moves | Permalink | Comments (1)

Tax Prof Richard Gershon Will Not Seek Another Term as Mississippi Dean

GershonOle Miss Law Dean Richard Gershon Resigns, Deborah Bell Appointed Interim:

After five school years at the helm of the University of Mississippi Law School, dean Richard Gershon will resign later this year.

In a release from Ole Miss, Provost Morris H. Stocks said:

Dean Richard Gershon has informed me that he has decided not to stand for quadrennial review and that his service as dean of the School of Law will conclude on June 30, 2015. I have asked Professor Deborah Bell to assume the role of interim dean of the School of Law in the near future. Dean Gershon and Dean Bell will begin to work out the plans for transition immediately.

March 5, 2015 in Legal Education | Permalink | Comments (1)

Mankiw: Dynamic Scoring in Congress Is Defensible but Slippery

New York Times:  Dynamic Scoring in Congress Is Defensible but Slippery, by N. Gregory Mankiw (Harvard):

Until now, conventional budget analysis has used a process called static scoring, which assumes that the path of gross domestic product remains the same when the government changes taxes or spending. This procedure has the virtues of simplicity and transparency.

Yet the assumption of unchanged G.D.P. also has one notable drawback: It is patently false. Much economic theory and empirical research confirm that fiscal policy influences the course of the economy.

Indeed, having an economic impact is a big part of why policy makers use the tools at their disposal, whether it is the tax cuts of Ronald Reagan and George W. Bush or the stimulus package of Mr. Obama. It seems somehow churlish for Congress’s economists to assume that a policy change won’t accomplish its goal simply to make their jobs easier. ...

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March 5, 2015 in Tax | Permalink | Comments (0)

WSJ: Are Prestigious Private Colleges Worth the Cost?

Wall Street Journal, Are Prestigious Private Colleges Worth the Cost?:

When college-acceptance letters are mailed to high-school seniors this spring, students who get offers from a wide range of schools may find themselves contemplating this question: Are prestigious, private colleges worth the additional cost?

ROI

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March 5, 2015 in Legal Education | Permalink | Comments (8)

The IRS Scandal, Day 665

IRS Logo 2Letter From Orrin G. Hatch (Chair, Senate Finance Committee) & Paul Ryan (Chair, House Ways & Means Committee) to John Koskinen (Commissioner, IRS) (Mar. 4, 2015):

As Chairmen of the Senate Committee on Finance and House Committee on Ways and Means, we have the obligation to conduct oversight of the administration of the Internal Revenue Code. This includes compliance with IRC §6103, which establishes rules governing the use of confidential tax return information and governs the manners in which it may be disclosed. As you know, §6103(g) provides the President of the United States and certain White House officials access to this information in limited circumstances and with certain required procedures. In carrying out our oversight obligations, we are seeking to determine the degree to and manner in which the Internal Revenue Service shares taxpayer information with the Executive Office of the President.

You will recall that former Ways and Means Chairman Dave Camp requested that the IRS provide all communication between the IRS and Executive Office of the President on April 30, 2014. You responded that your agency would be unable to provide the requested communication because of limited resources. In light of your response, our committees sought these records from the White House in two separate letters earlier this year. On February 17, White House officials responded to our requests, refusing to provide the documents and redirecting the request to the Internal Revenue Service. In light of the White House Counsel’s refusal to comply with our request, we ask that you provide the documents – originally requested in April of last year – without delay. This production will include all electronic communication in the agency’s possession from or to an “eop.gov” email address, or regarding White House communication, from January 1, 2010 through the date of this letter.

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March 5, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, March 4, 2015

Blouin Presents The Role of 'Check-the-Box' on Multinational Tax Planning Today at Penn

Blouin (2015)Jennifer Blouin (Pennsylvania) presents Does Organizational Form Affect Firms' Foreign Operations? The Role of 'Check-the-Box' on Multinational Tax Planning at Pennsylvania today as part of its Tax Law and Policy Workshop Series hosted by Chris William Sanchirico and Reed Shuldiner:

This study investigates the effect of the 1997 check-the-box tax legislation on the current effective income tax rates of U.S. multinational firms. Following the empirical methodology developed in Dyreng and Lindsey (2009), we measure the effect that the change in legislation has on the average worldwide, U.S., and foreign taxes paid on worldwide, federal and foreign pretax book income for a large sample of U.S. multinational firms. We find that on average U.S. multinational firms’ worldwide tax rates declined by 4.3% in the post-1996 period. Further, we find that the effect of the legislation was greater on U.S. multinational firms’ average foreign tax rates as compared to their average U.S. foreign tax rates. Our results also suggest that the effect is concentrated in the U.S. multinational firms that had a greater change in their ownership structures and a greater change in the balance of their intercompany payments in the post-1996 period. Although our results do suggest that the 1997 legislation served to reduce U.S. tax collections, our results imply that the 1997 legislation had a greater effect on firms’ foreign tax burdens.

March 4, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

U.S. Companies Are Stashing $2.1 Trillion Overseas to Avoid Taxes

Bloomberg, U.S. Companies Are Stashing $2.1 Trillion Overseas to Avoid Taxes:

Eight of the biggest U.S. technology companies added a combined $69 billion to their stockpiled offshore profits over the past year, even as some corporations in other industries felt pressure to bring cash back home.

Microsoft, Apple, Google and five other tech firms now account for more than a fifth of the $2.10 trillion in profits that U.S. companies are holding overseas, according to a Bloomberg News review of the securities filings of 304 corporations. The total amount held outside the U.S. by the companies was up 8 percent from the previous year, though 58 companies reported smaller stockpiles.

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March 4, 2015 in Tax | Permalink | Comments (1)

Kleinbard: A Lower Corporate Tax Rate Would Overcome Resistance to Tax Reform by Encouraging Incorporation of Pass-Through Entities

Bloomberg View:  Take the Odds on Corporate Tax Reform, by Edward D. Kleinbard (USC):

The smart money always wagers against tax reform, but 2015 may be the year that the sucker bet pays off, at least for business taxes. The driver could be the outdated corporate tax system:  The current 35 percent rate is out of step with world norms and holds back investment in the U.S. 

There is general agreement that the corporate tax rate should be in the mid-20s. There is also near-consensus that most tax incentives and subsidies should be thrown out to free up the revenue needed for lower rates. 

Two big hurdles remain. The more intractable one involves so-called pass-through entities. These firms -- sole proprietorships, partnerships, limited liability companies and S corporations -- are often conflated with small businesses and entrepreneurs, even though many of them are well-heeled hedge funds, law firms and private-equity shops. 

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March 4, 2015 in Tax | Permalink | Comments (2)

Jennifer Bard Named Dean at Cincinnati

BardJennifer Bard (Texas Tech) has been named the next Dean of the University of Cincinnati College of Law, effective July 1, 2015. She will replace Louis Bilionis, who is returning to full-time teaching after serving two terms as dean.

A Yale JD who studied at Oxford and graduated from Wellesley, Professor Bard is an expert in public health and bioethics. She has a Masters of Public Health degree and a PhD in higher education. She will hold a secondary faculty appointment in the Department of Internal Medicine in UC's College of Medicine.

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March 4, 2015 | Permalink | Comments (1)

Clausing: Beyond Territorial and Worldwide Systems of International Taxation

Kimberly A. Clausing (Reed College), Beyond Territorial and Worldwide Systems of International Taxation:

The dialogue regarding the international taxation of multinational firms should move beyond the rhetoric of comparing supposedly territorial and worldwide systems of taxation. Among major countries, there are no pure territorial or pure worldwide systems, just systems that lie on a spectrum between these extremes. Once one recognizes the characteristics that determine where on the spectrum particular countries lie, it is far from clear that purportedly worldwide countries are further to the “pure worldwide” end of the spectrum than are many purportedly territorial countries. Still, along the spectrum, tradeoffs between “competitiveness” and efficient capital allocation (with attendant effects on the home country tax base) are inevitable. Thus, I describe international tax system design proposals that might transcend this tradeoff, examining several such options. Finally, I discuss the current efforts of the BEPS process.

March 4, 2015 in Scholarship, Tax | Permalink | Comments (0)