TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Monday, May 9, 2016

L.A. Jones Day Associate: 'Let’s Do This Together'—In Law, Women Need To Help Other Women

Jones DayBloomberg Law op-ed: In Law, Women Need to Help Other Women, by Rachel Gezerseh (Associate, Jones Day, Los Angeles):

I’ve seen a lot of articles lately about the difficulties at large law firms with retaining female attorneys, the so-called “leaky pipeline” in Biglaw. To me, as a female associate at a large law firm, the solution is simple: women need to help other women. If you know another woman has your back, you stay. If you don’t have that support, you leave. Also, giving back to other women when you can is important.

I have three stories on this from my life. ... 

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May 9, 2016 in Legal Education | Permalink | Comments (2)

WSJ:  What Is Prince’s Legacy Worth? The Tax Man Wants To Know.

DovesFollowing up on my previous post, Prince Died Without A Will, According To Court Documents:  Wall Street Journal, What Is Prince’s Legacy Worth? The Tax Man Wants to Know:

After the doves cry, there’s IRS Form 706.

Estate-tax attorneys for Prince, who died [April 21], must attempt to put a precise financial value on his name, image and likeness.

That Prince-ness could make him one of America’s top-earning deceased celebrities, and it may be one of his estate’s largest assets—subject to a 40% federal tax.

The Internal Revenue Service is used to putting price tags on tradeable assets and is well-trained in taking existing revenue streams and capitalizing them into a value. It is much trickier to divine the worth of a unique niche business—marketing Prince’s legacy—that doesn’t really exist yet.

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May 9, 2016 in Celebrity Tax Lore, Tax | Permalink | Comments (0)

Harvard Law School Sees 50% Increase In STEM Majors After Accommodating Their Lower UGPAs In Admissions Decisions

Harvard Law School (2016)Harvard Crimson, To Keep Pace with Tech, Law School Seeks STEM Students:

As Harvard Law School admissions officers finalize next year’s class, they do so with an eye toward a group of fields that deviate from the traditional path to legal studies: STEM.

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May 9, 2016 in Legal Education | Permalink | Comments (1)

LSAC Backs Down (For Now) On Threat To Expel University Of Arizona For Use Of GRE In Law School Admissions

GRE Arizona Following up on my previous posts (links below):  National Law Journal, Opposition to Arizona Law School’s Use of GRE Fizzles:

The University of Arizona James E. Rogers College of Law will remain a member of the Law School Admission Council—for now.

The council, which administers the Law School Admission Test, informed Arizona law dean Marc Miller by letter Saturday that the Tucson law school will be allowed to remain in its membership ranks “for the time being.”

The council’s board of trustees at its meeting on Friday and Saturday discussed whether Arizona’s use of the GRE in addition to the LSAT violated the council rule that requires “substantially all” applicants to members schools take the law school-specific test. ...

“We understand the Accreditation Committee of the ABA Section of Legal Education and Admissions to the Bar will review the GRE study and address the validity of the alternative tests as well as other issues related to [the ABA admissions standard],” the council’s May 7 letter reads. “The resolution of these issues may well impact LSAC’s membership requirements.” Hence, the board decided to maintain the existing membership, the letter said.

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May 9, 2016 in Legal Education | Permalink | Comments (3)

Taxing Carried Interest As Ordinary Income Through Executive Action

Following up on my previous post, Taxing Carried Interest As Ordinary Income Through Executive Action:  New York Times:  Ending Tax Break for Ultrawealthy May Not Take Act of Congress, by Gretchen Morgenson:

It’s only natural that Barack Obama, entering the homestretch of his presidency, would be concerned about his legacy. Judging from a recent interview in The New York Times Magazine, getting credit for the actions he has taken on economic issues seems to be of special interest to him.

Mr. Obama expressed frustration that many middle-class Americans feel they’ve been left behind during his time in office. The wealthiest Americans, meanwhile, have become richer during the Obama years.

There is a lot about this problem of income inequality — and about the economy over all — that Mr. Obama cannot control. Still, there is something he could do right now to help narrow the widening gulf between rich and poor.

In one deft move, Mr. Obama could instruct officials at his Treasury Department to close the so-called carried interest tax loophole that allows managers of private equity and hedge funds to pay a substantially lower federal tax rate on much of their income.

Forcing these managers to pay ordinary income taxes on the gains they reap in their funds would accomplish two things. It would take away an enormous benefit enjoyed almost exclusively by some of the country’s wealthiest people. And, tax experts say, it would generate billions in revenue to the government each year, though there are wide differences over exactly how much.

But doesn’t changing the carried interest loophole require an act of Congress? Not according to an array of tax experts. Just as Mr. Obama’s Treasury Department recently changed the rules to curb corporate inversions, in which companies shift their official headquarters to another country to lower their tax bills, the Treasury secretary, Jacob J. Lew, and his colleagues could jettison the carried interest loophole.

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May 9, 2016 in Tax | Permalink | Comments (6)

NLJ Special Report:  The Mental Health Of Law Students

National Law Journal (2016)National Law Journal, In Focus: The Mental Health of Law Students:

The numbers are disturbing: Law students suffer from depression, anxiety and substance abuse at unusually high rates. In our report about mental health on law campuses, we examine why law school exacerbates these problems and what administrators and fellow students can do to help. We also share first-person accounts of navigating law school with a mental health condition, from the student and faculty perspective.

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May 9, 2016 in Legal Education | Permalink | Comments (0)

IRS Seeks Grant Applications for Funding for Low Income Taxpayer Clinics, Volunteer Tax Assistance Programs

IRS Logo 2The IRS has announced that it is accepting grant applications for Low Income Taxpayer Clinics (IR-2016-70) and Volunteer Tax Assistance Programs (IR-2016-71) for the 2017 grant cycle (Jan. 1 - Dec. 31, 2017).

Low Income Taxpayer Clinics

Applications will be accepted through June 20, 2016. The LITC program awards matching grants of up to $100,000 per year to qualifying organizations to develop, expand, or maintain a low income taxpayer clinic. 

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May 9, 2016 in IRS News, Tax | Permalink | Comments (0)

The IRS Scandal, Day 1096

IRS Logo 2Bloomberg BNA, Americans for Prosperity Shows That Rough and Tumble Issue Activism Could Serve as a Shield for Charities Against Donor Disclosures:

We all know the saying “politics ain’t beanbag” – and the ranks of candidates for high office seem to be living by that adage. But in the last several years we have seen a significantly more confrontational style filter down to the grassroots issue activists behind any number of organizations and causes – threats to boycott stores (see Hobby Lobby Stores) or even entire states (North Carolina and not too long ago Georgia) over laws or stances taken; calls for individuals to be fired from their jobs or otherwise “economically disciplined” for expressing opinions deemed “unacceptable” (such as Brendan Eich’s ouster from Mozilla for donating to the California Proposition 8 campaign after calls from activists or Atlanta Fire Chief Kelvin Cochran’s dismissal for expressing his disapproval of same-sex marriage in a religious book he published); and even instances of physical altercations or harassment (picketing the homes of politicians’ families, or attempting to physically disrupt events or attendees). Now we may see that style of politics become a tool by which charities and other exempt organizations challenge state-level disclosure requirements that would force them to disclose donor information. ...

Americans for Prosperity Foundation (AFP) won just such a challenge when Judge Manuel Real of the U.S. District Court for the Central District of California held California’s requirement for charities to file annually with the Attorney General (AG) their unredacted Form 990 Schedule B (Schedule of Contributors) to be unconstitutional as applied to AFP. Judge Real permanently enjoined the AG from requiring or demanding AFP’s Schedule B information.

The primary basis for the decision was extensive trial evidence of harassment and intimidation that supporters of AFP and those affiliated with it have experienced. Though Judge Real only recounted a few of the incidents established at trial, the details sound like much of the activism that is becoming more prevalent: An IT contractor took to social media to condemn AFP (and suggest that he could easily slit the throat of AFP’s CEO) and was later found in the garage photographing license plates; protestors at an event cut down the tent being used for the function while attendees were still inside; major donors have received numerous death threats and had their business boycotted once their affiliation has become known; the Koch brothers, long-time supporters have been threatened, along with their families, including their grandchildren (who are all still minors). As Judge Real put it in conclusion, “the Court finds that AFP supporters have been subjected to abuses that warrant relief….” ...

In the end, Judge Real’s opinion may work to open the floodgates for other organizations that have been targeted for various forms of harassment or abuse. Several states have either instituted, revived, or proposed requirements that charitable organizations file their Schedule B information with state officials. And while California has been the focal point of challenges, the U.S. District Court for the Southern District of New York has upheld a similar New York requirement against a facial challenge (see Citizens United v. Schneiderman). While the initial failure of those facial challenges may have dampened litigation at first, this new decision will certainly result in additional interest in litigating these disclosure requirements, even if it must be done on an organization-by-organization basis. For now, we can only wait and see what, if anything, the Ninth Circuit does on appeal.

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May 9, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

TaxProf Blog Weekend Roundup

Sunday, May 8, 2016

Sagers:  The Antitrust Implications Of LSAC's Threatened Expulsion Of University Of Arizona Over Use Of GRE In Law School Admissions

GRE Arizona Following up on my previous posts:

TaxProf Blog op-ed:  Did LSAC Just Get Itself In Antitrust Trouble? Could Be; It’s Kind of Hard to Say, by Christopher L. Sagers (Cleveland State):

Here’s a story of a kind that’s been of acute interest to me, ever since my own absurdly dismal LSAT score nearly cost me entrance to any law school and unambiguously predicted I would flunk out of the one that grudgingly took me off its wait list. (That latter prediction was rather mistaken as it happens, thank you very much).

The Law School Admissions Council and its erstwhile member the University of Arizona College of Law got some headlines last week, and battle lines are forming quickly. LSAC ejected Arizona over its choice to permit applicants to submit GRE scores instead of LSAT scores. Arizona was the very first law school to do so, basing its decision on a study finding the GRE as predictive of first-year law school success as the LSAT. Dean Marc Miller said his goal is to “reach a broader pool of would-be applicants,” in order “to put together the best and most diverse class we can.” LSAC expulsion, he said, “seems like a pretty bald way to punish us for innovating.”

LSAC’s move looking rather like a collective act of its law school members to control the means by which they’ll sell the legal education product, and the industry being one that has generated a fair bit of antitrust litigation, a natural question is whether the expulsion could expose anyone to antitrust risks. Critics quickly said as much; as one of them put it, “I’m no antitrust expert, but this rule smells bad.”

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May 8, 2016 in Legal Education | Permalink | Comments (1)

TIGTA:  IRS Mischaracterizes 88% Of Hobbies As For-Profit Businesses, Allowing Billions In Improper Loss Deductions

TIGTAThe Treasury Inspector General for Tax Administration has released Opportunities Exist to Identify and Examine Individual Taxpayers Who Deduct Potential Hobby Losses to Offset Other Income (2016-30-031):

The Treasury Inspector General for Tax Administration (TIGTA) today publicly released its audit report of the Internal Revenue Service’s (IRS) methods of addressing taxpayers who take business tax deductions for activities not engaged in for profit. TIGTA found that the IRS can improve its methods for identifying high-income taxpayers who may be offsetting their income with “hobby losses” from unprofitable business activity.

The tax code allows taxpayers to deduct all ordinary and necessary expenses paid or incurred in carrying on a trade or business. However, in the “hobby loss” provision in the tax code, the IRS generally disallows business tax deductions for activities not engaged in for profit.

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May 8, 2016 in Gov't Reports, IRS News, Tax | Permalink | Comments (10)

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 #5:

  1. [811 Downloads]  Lexisnexis® Guide to FATCA Compliance: Chapter 1, by Willliam Byrnes (Texas A&M) & Robert J. Munro (Texas A&M)
  2. [342 Downloads]  Ownership of the Means of Production, by E. Glen Weyl (Chicago) & Anthony Lee Zhang (Stanford)
  3. [307 Downloads]  The Law of the Platform, by Orly Lobel (San Diego)
  4. [271 Downloads]  The Panama Papers and Tax Morality, by Usman W. Chohan (University of New South Wales)
  5. [245 Downloads]  Trust Protectors: Why They Have Become 'The Next Big Thing', by Lawrence Frolik (Pittsburgh)

May 8, 2016 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

New Decanal Appointments At Pepperdine Law School

Big ThreeContinuing our season of change at Pepperdine:  three of my favorite and stunningly effective and caring colleagues have assumed important new decanal duties at the law school:

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May 8, 2016 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 1095

IRS Logo 2Linda Beale (Wayne State), IRS Scrutiny of 501(c)(3)s:

As most everybody is aware by now, the IRS has been under considerable strain for a number of years from budget and staff reductions that have left it underfunded, understaffed, and under pressure.  This is part of the right's effort to "shrink the government to a bathtub and drown it."  If the main organization for helping Americans understand their tax obligations is understaffed, it is likely that many people will become irritated with the agency and blame it (and taxes) for all their problems.  If the main organization for enforcing the U.S. tax laws fairly has too few people to audit the most likely scoflaws and too little money to prepare guidance and rulings to make it harder for scofflaws to scoff at the law, then many people will become irritated with the agency and blame it (and taxes) for their problems while many other people (especially the privileged rich) will continue to scoff at the law by overstating their basis when they sell capital assets, hiding assets in tax havens, and just hiring lots of expensive tax attorneys and accountants to come up with schemes for wiggling through the loopholes in the Code to avoid more taxes.

And of course, if the main organization for ensuring that tax-exempt organizations are not abusing their tax exempt status by using "dark money" to allow the domestic elite and foreign powers to influence and control federal elections and legislation, then odds are the rich and elite and foreign powers will wield more and more influence and control over who gets elected and what kind of legislation they pass.  Odds are we will see even more of the kinds of absurd legislation disenfranchising the poor and minorities by making it harder to vote, harder to get a State-issued I.D. card, harder to wait in line for hours at the polls (if you will be fired for not reporting to work), etc.

None of this is any surprise.

None of it is good government.

All of it is supported by the current radicalized uber-right-wing Republican Party hacks that are running many state governments and hold the majority right now in the U.S. Senate and House of Representatives.

As the New York Times editorial board noted, "[c]laiming a 'social welfare' tax exemption has become a tool for powerful political operatives like Karl Rove, the Republican campaign guru.  His Crossroads GPS group, which has 501(c) status, has spent $330 million on ads and candidates since it was created in 2010."  See Editorial,  Dark Money and an I.R.S. Blindfold, New York Times (Apr. 28, 2016).  And of course, with all the ranting about it being a problem to pick a group with "Tea Party" or "Progressive" in their name for closer scrutiny (when any common sense analysis will tell you that such a group is quite likely to be engaged in forbidden lobbying activities), "the IRS has grown ever more gun-shy about enforcement."

So the latest bill wreaking havoc on democracy, put forward by Republican Peter Roskam in the House of Representatives, would eliminate the current law that requires those who donate more than $5000 to a nonprofit to be disclosed to the IRS (though redacted for public versions of organizations' tax forms)..  See, e.g., Richard Rubin, House Republicans Seek to Block IRS Collection of Non-profit Donor Data, Morningstar, Apr. 28, 2016. That means a foreign corporation or a foreign sovereign power could contribute enormous sums to shape the legislative and regulatory regimes in our country, and there would be NO WAY TO POLICE THE PROBLEM. 

Further, it is hard to understand why any donor to a tax-exempt organization should be entitled to anonymity.  The organization is able to avoid paying any taxes on the funds received, and--especially under the current malevolent eye from Congress towards the IRS--the IRS is hamstrung in enforcing the law against political campaigning with 501(c)(3) funds.  What we should do instead of allow complete anonymity and the power plays that encourages is the opposite:  the name of every donor who gives anything more than some de minimis threshold amount to any tax-exempt organization should be publicly available, and the amount given should be publicly available.  After all, if money is "speech", "speech" is supposed to be heard.  Remember the old saying about the tree that fell in the forest and whether there would even be any sound if there were no eardrum available to hear it.  That's certainly the case with speech.  If giving money is a form of speech, than the gift and giver shouldn't be hidden under a bushel but should be broadcast far and wide for anyone who wants to know.

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May 8, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Saturday, May 7, 2016

This Week's Ten Most Popular TaxProf Blog Posts

Galle:  Section 305 And The Roosting Chickens Of The Chan-Zuckerberg Initiative

FaecbookBrian Galle (Georgetown), Zuckerblogging, Part I:

Facebook this week informed its shareholders that it is planning to issue a stock dividend. Existing shareholders, including Zuckerberg, will receive two shares of a new class of non-voting common stock for each of their existing shares. Readers may recall that Facebook already has 2 classes of common stock, one providing each share with one vote, and a second (mostly held by Zuckerberg) providing much more voting power. The dividend raises both some interesting philanthropy issues as well as some interesting technical questions about Tax Code section 305 (if the idea of “interesting…section 305” is not an oxymoron).

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May 7, 2016 in Tax | Permalink | Comments (0)

ABA Tax Section May Meeting

The ABA Tax Section May meeting concludes today in Washington, D.C.  The full program is here.  Today's highlights are:

SedoPro Bono & Tax Clinics, Reflecting on Low Income Tax Clinics and Celebrating Professor Kathryn Sedo

This program will look back at low income tax clinics since their inception with a particular focus on retiring clinic Professor Kathryn Sedo of the University of Minnesota. Professor Sedo has been a part of the low income taxpayer community as one of the founders of one of the oldest clinics in the country. As she retires from her current position, we have the opportunity to look at the changes in the tax system as it relates to low income taxpayers over the course of her career and to look forward.

  • Frank DiPietro (Minnesota) (moderator)
  • Leslie Book (Villanova)
  • Keith Fogg (Harvard)
  • Peter Panuthos (Chief Special Trial Judge, U.S. Tax Court)

GideonPosthumous Presentation, 2016 Distinguished Service Award Recipient Ken Gideon

The Section of Taxation is pleased to honor Kenneth W. (“Ken”) Gideon as the recipient of its 2016 Distinguished Service Award in recognition for his distinguished career in recognition of his service to the profession, service to the government, and service to the Section. 

The Distinguished Service Award is the highest honor awarded by the Section of Taxation. The Award is given to individuals who have had a distinguished career in taxation and “who have provided an aspirational standard for all tax lawyers to emulate.” In the fall of last year, the Distinguished Service Award Committee unanimously selected Ken to be this year’s recipient. As is the custom of the Committee, the plan was to inform Ken of the Award at the Council Dinner during the January meeting in Los Angeles. Ken passed away unexpectedly on January 10, 2016, two weeks before the Los Angeles meeting. [See Michael Graetz, Farewell To Ken Gideon.]

Other Tax Profs with speaking roles today include:

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May 7, 2016 in ABA Tax Section, Conferences, Tax | Permalink | Comments (0)

The Future Is ‘Bleak’ For Law Students And Law School Graduates

Above the Law, The Future Is ‘Bleak’ For Law Students And Law School Graduates:

Legal education has been getting bad press since the start of the Great Recession, and perhaps for good reason. While tuition skyrocketed, often leaving graduates with six-figure debt loads, quality job prospects seemingly disappeared. The jobs that were left had salaries that were too low to service those graduates’ tremendous debt loads. Prospective law students began to hear about new lawyers’ joblessness and indebtedness, and stopped applying. This prompted many law schools to lower their admissions standards in the hope of filling their seats. This, in turn, brought about wave after wave of record-setting failure rates on bar exams nationwide.

Now that class sizes are smaller, employment statistics seem to look “better,” and law school administrators across the country have started spreading the word that law school is once more a good investment. But is it really?

Law students and graduates have started using Whisper, an anonymous messaging service, to tell the world about legal education and what it has done to them. These messages are representative of the general tone of posts having to do with law school.


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May 7, 2016 | Permalink | Comments (8)

The IRS Scandal, Day 1094

IRS Logo 2The Daily Signal, Why Donors to Nonprofits Need to Be Protected From the IRS:

Congressional calls for the impeachment of IRS Commissioner John Koskinen are once again making headlines. In an interview with The Daily Signal, Cleta Mitchell, an attorney representing numerous conservative groups targeted by the IRS, explains why Koskinen should never have been appointed in the first place and why current laws need to be changed to protect donors to nonprofit groups from being targeted and audited by the agency.

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May 7, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Friday, May 6, 2016

Fate Of Energy Transfer/Williams Merger Turns On Differing Tax Opinions From Latham & Watkins, Cravath

ETWWall Street Journal, Energy Transfer Thinks Taxes Could Doom Its Deal With Williams:

The fate of Energy Transfer Equity’s troubled $32 billion tie-up with Williams may rest with the Internal Revenue Service.

That’s the message in a new securities filing from ETE that lays bare the growing tensions between the pipeline companies, whose proposed merger, struck last September after a yearlong pursuit, has been complicated by sliding oil prices and concerns over leverage. The filing covers perceived tax risks and dueling lawsuits between the companies and shows the depths of ETE’s concerns about the deal, summed up here: “ETE believes there is substantial risk that the merger will not be consummated.”

The main reason, according to ETE, is taxes.

Last month, ETE said its lawyers at Latham & Watkins LLP weren’t sure they could give a required opinion that the deal would be tax-free for investors, without elaborating. On Wednesday, ETE nodded at two potential pitfalls, both of which stem from the roundabout way this merger is structured. (Simply put, ETE is floating a new entity, Energy Transfer Corp., and buying shares of that entity for $6 billion in cash. ETC will give that cash, along with a lot of ETC shares, to Williams investors in exchange for their Williams stock.)

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May 6, 2016 in Tax | Permalink | Comments (0)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

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May 6, 2016 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Student Tax Note Roundup

ABA Tax Section May Meeting

ABA Tax SectionThe ABA Tax Section May meeting continues today in Washington, D.C.  The full program is here.  Yesterday's highlight was the annual Laurence Neal Woodworth Memorial Lecture in Federal Tax Law and Policy on What Has the Tax Court Been Doing? An Update delivered by Senior Tax Court Judge James S. Halpern. Today's highlights are the two Teaching Taxation programs:

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May 6, 2016 in ABA Tax Section, Conferences, Tax | Permalink | Comments (0)

WSJ:  Is Taxing Harvard, Yale And Stanford The Answer To Rising College Costs?

Harvard Yale StanfordWall Street Journal, Is Taxing Harvard, Yale and Stanford the Answer to Rising College Costs?:

Lawmakers have a new solution for the high cost of college: Make the wealthiest universities pay for it.

Elite U.S. schools have grown richer since the 2008 financial crisis by investing their endowment money in everything from California vineyards to Chinese startups. State and federal policy makers now want to tax those profits—or force the wealthiest schools to spend down their endowments—to defray soaring student bills and refill depleted higher-education budgets.

“College costs have outpaced health-care inflation, and at the same time, there’s this benefit for endowments,” said Rep. Peter Roskam (R., Ill.), chairman of the House Ways and Means Subcommittee on Oversight, complaining in an interview about the funds’ tax-free status. “I don’t want to assert a conclusion, but let’s put this in the ‘I’m just saying’ category.”

Mr. Roskam and two other Republican congressional leaders have asked 56 private colleges with endowments of more than $1 billion—including Harvard University, Yale University and Stanford University—for detailed information about their holdings and policies for rewarding large donors with naming rights.

The lawmakers are looking for assurances that the schools are using their investment profits to help students and serve their nonprofit educational missions. The congressmen may propose taxes on endowment income or requirements that funds increase their earmarks for financial aid, a spokesman for Mr. Roskam said.

Rep. Tom Reed (R., N.Y.), who is also on the House Ways and Means committee, floated a plan late last year that would require endowments bigger than $1 billion to pay out a quarter of their earnings in grants to working-class families or face steep penalties or even the loss of their tax-exempt status. He is waiting for the committee to outline its next steps before introducing the bill, a spokeswoman said.

Behind the push is discontent over a growing gap between higher education’s haves and have-nots. About half of U.S. endowment wealth is held by two dozen schools enrolling 5% of the roughly 20 million students attending American colleges and universities, according to a Wall Street Journal analysis of National Association of College and University Business Officers and Commonfund data as well as federal data.


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May 6, 2016 in Legal Education | Permalink | Comments (5)

The Best LL.M. Programs For International Students

IJInternational Jurist (2016), The Best LL.M. Programs:

Which are the best U.S. LL.M. programs for  attorneys outside the U.S.?

With more than 80 law schools and 300 graduate law programs to choose from, it would be a lot easier to answer that question if there were one overall ranking of the best programs.

The problem, experts agree, is that a strong program for one student could be a weak program for another. ...

We researched which schools offer the most robust LL.M. programs for international students and divided our findings into [four] areas: Academics, the Law School Experience, Career Opportunities, Cost and Value.

We gathered data from the American Bar Association and other sources. We then determined some of the key points that make a school great for each of those categories. We identified the schools that excelled and recognized them on our honor roll.

1.  Academics (11 law schools)

2.  NJThe Law School Experience (14 law schools):

A quality legal education is about more than academics. Many students, especially those with plans to take the U.S. bar and work in the United States, are seeking institutions that help them adjust to campus life, let them participate in extracurricular offerings, get to know and collaborate with U.S. students, explore the surrounding communityand gains hands-on training through clinics and/or externships. ...

Thomas Stipanowich, academic director of the Straus Institute for Dispute Resolution at Pepperdine University School of Law, said the entire focus of the LL.M. program revolves around building a sense of community. " "We have 50 students from 22 foreign countries represented in this year's group of 70 LL.M. candidates at the Institute," Stipanowich said.

The Institute offers five different LL.M. degrees, including an LL.M. in dispute resolution and an LL.M. in international commercial arbitration.

He said the institute's staff works closely with international students to help them find housing and get to know the campus and the Los Angeles area. "We offer a variety of outside activities, some that are sponsored by the school and others that are hosted by faculty," he said. "My wife and I live [near] the campus and have hosted multiple gatherings at our home, with a spotlight on our international students."

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May 6, 2016 in Legal Education | Permalink | Comments (0)

Coke Bottler's Merger Might Run Afoul Of New Anti-Inversion Rules

CokeBloomberg, Coke Bottler's Merger Might Lose Tax Gain to Inversion Rules, by Lynnley Browning:

When Coca-Cola Enterprises Inc. announced a merger with two overseas counterparts last August, the Atlanta-based bottler of Coke drinks in Western Europe said the deal had nothing to do with cutting its corporate tax bills.

Now, after the U.S. Treasury Department proposed tougher-than-expected regulations designed to prevent firms’ shifting profits offshore last month, the company has a different message.

In an April 11 securities filing, Coca-Cola Enterprises warned that one Treasury proposal, unveiled seven days earlier, could reduce the merger’s anticipated annual savings of as much as $375 million -- though it didn’t specify a new amount. Since the rule targets a tax-cutting technique known as “earnings stripping,” the company’s disclosure shows that tax savings were an important benefit of the merger all along, said Robert Willens, a tax and accounting consultant in New York. ...

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May 6, 2016 in IRS News, Tax | Permalink | Comments (0)

Robert Sitkoff's 'Last Lecture':  Hope For The Best; Plan For The Worst

Harvard Law Today, A Trust and Estates Lawyer’s ‘Last Lecture’: ‘Hope For the Best; Plan For the Worst’:

“Hope for the best; plan for the worst,” Harvard Law School Professor Robert Sitkoff told the audience on March 29, in his contribution to the Last Lecture series. Sitkoff, an expert in trusts and estates, wove the trusts and estates motto throughout his speech as he explained the importance of private law in helping individuals organize their lives.

The Last Lecture Series, which is organized by the Class Marshals, asks popular HLS professors to give lectures addressing the graduating class. This year’s series has also featured Professors Jeannie Suk ’02, Annette Gordon-Reed ’84, and Robert Bordone ’97.

(Click on YouTube button on bottom right to view video directly on YouTube to avoid interruption caused by blog's refresh rate.)

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May 6, 2016 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 1093

IRS Logo 2Linda Sugin (Fordham), Politics, Disclosure, and State Law Solutions for 501(C)(4) Organizations, 91 Chi.-Kent. L. Rev. ___ (2016):

Non-charitable nonprofit organizations are important political players, and they operate with little regulation and behind a veil of anonymity. The customary regulators of these organizations − the IRS and the FEC − are paralyzed by scandal and dysfunction, and have done nothing to address the problem of dark money in politics spawned by the Supreme Court’s 2010 decision in Citizens United v. FEC. This article considers whether state nonprofit law can fill the gap left by federal tax and election regulators. It describes the efforts taken by California and New York to limit the influence of out-of-state anonymous money in state elections, and considers the policies that states might pursue in regulating politicking by nonprofits under their jurisdiction.

This article argues that state nonprofit law regulation could be desirable if states are concerned with either (1) shielding charitable organizations from the taint of political nonprofits, or (2) protecting donors to social welfare organizations from unwittingly underwriting political activity. However, if states are primarily interested in equalizing political power, silencing out-of-state voices, or protecting voters from fraud, then state nonprofit law is a poor regulatory fit. While most demands for dark-money regulation focus on disclosing the identity of nonprofit donors, this article explains that the appropriate regulation depends on the policy that drives it. While it argues that states have legitimate nonprofit-law concerns and could experiment to pave the way for federal regulation, it ultimately concludes that state nonprofit law regulation is unlikely to have the scope or effectiveness necessary to address the problem created by Citizens United.

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May 6, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Thursday, May 5, 2016

Virginia Tax Review Publishes New Issue

Virginia Tax Review (2016)The Virginia Tax Review has published Vol. 35, No. 1 (Summer 2015):

May 5, 2016 in Scholarship, Tax | Permalink | Comments (0)

Harper:  Recent ABA Jobs Data Show That Boom Times For Lawyers (And Law Schools) Are Not Around The Corner

ABA Logo 2Steven J. Harper (Adjunct Professor, Northwestern), About That Lawyer Shortage …:

Facts are stubborn things — almost as stubborn as persistent academic predictions that boom times for attorneys are just around the corner.

Back in 2013, Professor Ted Seto at Loyola Law School-Los Angeles observed, “Unless something truly extraordinary has happened to non-cyclical demand, a degrees-awarded-per-capita analysis suggests that beginning in fall 2015 and intensifying into 2016 employers are likely to experience an undersupply of law grads, provided that the economic recovery continues.”

In November 2014 after the Bureau of Labor Statistics proposed a new and deeply flawed methodology for measuring attorney employment, Professor Seto weighed in again: “If the new BLS projections are accurate, we should see demand and supply in relative equilibrium in 2015 and a significant excess of demand over supply beginning in 2016.” His school’s full-time long-term bar passage employment rate for the class of 2015 was 62 percent — slightly better than the overall mean and median for all law schools, which are just under 60 percent. ...

To his credit, Professor Jerry Organ at the University of St. Thomas School of Law has been fearless in challenging the relentless optimism of his academic colleagues. And he does it with the most persuasive of lawyerly approaches: using facts and evidence. Analyzing the ABA’s recently released law school employment reports for all fully-accredited law schools, Professor Organ notes that the number of graduates dropped in 2015. But for the second straight year, so did the number of full-time long-term jobs requiring bar passage. ...

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May 5, 2016 in Legal Education | Permalink | Comments (16)

George Mason President Resists University Faculty's Call To Reject Naming Law School After Justice Scalia For $30 Million

Pace Renames Law School For Late Environmentalist For $25-$30 Million

Brunson:  It Is Time For The IRS To Enforce The Prohibition On Campaigning By Churches

CHurchSamuel Brunson (Loyola-Chicago), Dear IRS, It Is Time to Enforce the Campaigning Prohibition. Even Against Churches, 87 U. Colo. L. Rev. 143 (2016):

In 1954, Congress prohibited tax-exempt public charites, including churches, from endorsing or opposing candidates for office. To the extent a tax-exempt public charity violated this prohibition, it would no longer qualify as tax-exempt, and the IRS was to revoke its exemption.

While simple in theory, in practice, the IRS rarely penalizes churches that violate the campaigning prohibition, and virtually never revokes a church’s tax exemption. And, because no taxpayer has standing to cuhallenge the IRS’s inaction, the IRS has no external imperative to revoke the exemptions of churches that do campaign on behalf of or against candidates for office.

This argment makes the normative case that, notwithstanding the IRS’s administrative discretion and the inability of taxpayers to challenge its nonenforcement in court, the time has come for the IRS to begin enforcing the campaigning prohibition.

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May 5, 2016 in Scholarship, Tax | Permalink | Comments (1)

Shay, Fleming & Peroni: Designing A 21st Century Corporate Tax

Florida Tax Review  (2015)Stephen E. Shay (Harvard), J. Clifton Fleming Jr. (BYU) & Robert J. Peroni (Texas), Designing a 21st Century Corporate Tax — An Advance U.S. Minimum Tax on Foreign Income and Other Measures to Protect the Base, 17 Fla. Tax Rev. 669 (2015):

The 21st Century has seen unprecedented levels of corporate tax aggressiveness and avoidance. This article continues our exploration of second best international tax reforms that would protect the U.S. corporate tax base and have some likelihood of adoption. In this case, we consider how a U.S. minimum tax on foreign income earned by a controlled foreign corporation should be designed to protect the United States against erosion of its corporate income tax base and to combat tax competition by low-tax intermediary countries. In the authors’ view, a minimum tax should be an interim levy that preserves the residual U.S. tax on foreign income, as distinguished from a final minimum tax that partially eliminates the U.S. residual tax. An interim minimum tax would be a significant improvement over current law and would more effectively limit incentives to seek low-taxed foreign income while ameliorating pressure to retain excess earnings abroad.

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May 5, 2016 in Scholarship, Tax | Permalink | Comments (0)

148 Deans Demand LSAC Rescind Threat To Expel University Of Arizona Over Use Of GRE In Law School Admissions

GREFollowing up on Sunday's post, The Empire Strikes Back: LSAC Threatens To Expel University Of Arizona Over Use Of GRE In Law School Admissions: Letter, From 148 Law School Deans to LSAC President Dan Bernstine (May 3, 2016):

We write as law school deans to express our great concern over LSAC’s threat to expel the University of Arizona Law School because it experimented with using the GRE as a small part of its admissions process. Experimentation benefits all of us. We all expect to learn from the University of Arizona’s experiment and it should not be punished by LSAC.

Most importantly, we strongly urge that the Board of Trustees allow the University of Arizona to remain a member of the Council. Expelling it for this is unwarranted under the existing rules and sends a terrible message to law schools about experimentation in the admissions process. Also, as deans at ABA accredited law schools and members of the LSAC Council, we urge the LSAC Board of Trustees to modify the provision of LSAC Bylaws Article I, Section 1, which “requires that substantially all of its applicants for admission” take the LSAT. The rule should be changed to allow experimentation with alternative tests.

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May 5, 2016 in Legal Education | Permalink | Comments (11)

The 'New Normal':  Number Of Americans Renouncing Their U.S. Citizenship Continues To Set Records

International Tax Blog, Over 1,000 Published Expatriates in 2016 Q1 — The New Normal:

Today the Treasury Department published the names of individuals who renounced their U.S. citizenship or terminated their long-term U.S. residency (“expatriated”) during the first quarter of 2016.

The number of published expatriates for the quarter was 1,158.  Only a few years ago, we would have been surprised by such a large quarterly number.  Now having over 1,000 published expatriates per quarter appears to be the new normal. 

Chart 1

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May 5, 2016 in Tax | Permalink | Comments (8)

Educating Lawyers And Engineers

Chronicle of Higher Education op-ed:  Law and Engineering Should Share Curriculum, by Julio M. Ottino (Dean, Northwestern Engineering) & Daniel B. Rodriguez (Dean, Northwestern Law):

A crashing Google car. An encrypted iPhone. These are more than recent technological controversies — they represent how technology collides with law, security, and public policy, with multiple trade-offs. They are just two examples of what will be an endless list of legal issues stemming from relentless innovation.

It’s said about innovation — considered a key advantage for the United States over global competitors — that engineers drive it, entrepreneurs profit from it, and lawyers impede it. But that’s off-base: Engineering and law should work together to advance the future. And because lawyers and engineers acquired their skills at a university somewhere, the logical entry point for change is education.

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May 5, 2016 in Legal Education | Permalink | Comments (0)

Call For Corporate Tax Papers:  ClassCrits IX

Class Crits 2ClassCrits IX Call for Papers and Participation: The New Corporatocracy and Election 2016:

We invite panel proposals, roundtable discussion proposals, and paper presentations that speak to this year’s theme, as well as to general ClassCrits themes.  Proposal due: May 16, 2016.

As the U.S. presidential election approaches, our 2016 conference will explore the role of corporate power in a political and economic system challenged by inequality and distrust as well as by new energy for transformative reform.

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May 5, 2016 in Conferences, Legal Education, Scholarship, Tax | Permalink | Comments (0)

Tulsa Votes To Strip Founder's Name Off Law School Building Due To KKK Ties

TulsaFollowing up on yesterday's post, Tulsa To Vote Today On Whether To Strip Founder's Name Off Law School Building Due To KKK Ties:  Tulsa World, TU Trustees Vote to Remove Name with KKK Ties From College of Law Building:

Completing a process one insider described as "challenging for all of us," University of Tulsa trustees on Wednesday voted to remove the name of one of its most steadfast supporters from the College of Law building.

John Rogers, a prominent attorney who died in 1977, was a TU trustee for 40 years and the law school's founding dean, but belonged to the Ku Klux Klan and another vigilante organization in the 1920s.

TU President Steadman Upham said those associations, although apparently brief, led to the decision to remove Rogers' name from the campus building erected in his honor in the 1970s.

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May 5, 2016 in Legal Education | Permalink | Comments (2)

The IRS Scandal, Day 1092

IRS Logo 2Kristin E. Hickman (Minnesota), Pursuing a Single Mission (or Something Closer to it) for the IRS, 7 Colum. J. Tax L. ___ (2016):

It is often said that taxes are the lifeblood of government. As the nation’s tax collector, the IRS serves a critical function without which the federal government would cease to function. Yet the IRS is an agency in crisis—mired in scandal, chronically underfunded, overreliant on automation, and failing to provide taxpayers with the support they need to comply with the tax laws and pay their taxes. This Essay argues that a major contributor to the IRS’s woes is Congress’s penchant in recent decades for utilizing the IRS to administer social welfare and regulatory programs that are only tangentially related to the IRS’s traditional revenue raising mission.

This Essay examines the consequences of that choice and calls for reforming the IRS’s organizational structure to segregate the revenue collection function from the biggest and most politically fraught social welfare and regulatory programs that currently fall within the IRS’s jurisdiction. To that end, this Essay suggests giving serious consideration either to spinning off several non-revenue raising programs from IRS oversight or to splitting up the IRS altogether and distributing its many functions among other new or existing agencies.

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May 5, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Wednesday, May 4, 2016

Hemel:  The President's Power To Tax

Daniel Hemel (Chicago), The President's Power to Tax, 102 Cornell L. Rev. ___ (2016):

President Obama and his predecessors have used their regulatory authority to implement significant elements of their domestic policy agendas across a wide range of issue areas—including the environment, immigration, labor, and health care. But recent administrations have been much less willing to exercise regulatory authority in the realm of tax. More precisely, recent administrations have been reluctant to take regulatory actions that raise revenue (although quite willing, in certain cases, to take regulatory actions that move the law in a taxpayer-friendly direction). This is not because the Executive Branch lacks the legal authority to adopt significant revenue-raising tax reforms via regulation: as this article demonstrates, the Executive Branch’s “power to tax” under existing statutes is broad. Nor is it because the President is satisfied with the tax status quo: recent Presidents have repeatedly asked Congress to amend the tax code via legislation. Yet in many cases, the change that the President asks Congress to make is a change that the Executive Branch already has authority to make on its own. What explains the reluctance of recent administrations to raise revenue through regulatory action?

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May 4, 2016 in Scholarship, Tax | Permalink | Comments (0)

California Is Bernie Sanders's Tax Nirvana: Top 1% Pay 48% Of Taxes

Los Angeles Times, When It Comes to Paying Taxes, California Is Bernie Sanders' Kind of State:

Bernie Sanders wags his finger and shouts that the richest 1% should pay their fair share. No one can argue they aren’t already in California, at least in state taxes. In fact, they’re forking over more than their fair share to Gov. Jerry Brown’s regime.

The latest figures have just been released, and the top 1% paid nearly half — 48% — of the state’s personal income taxes in 2014.

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May 4, 2016 in Tax | Permalink | Comments (6)

NY Times:  AG Dings Developer Aby Rosen For $7 Million In Unpaid Taxes On Art

HurstFollowing up on my previous posts:

New York Times, Developer Aby Rosen to Pay $7 Million in Suit Over Unpaid Taxes on Art:

Aby J. Rosen, the Manhattan real estate developer and art collector, is well known for exhibiting works from his collection at the landmark Seagram Building and at Lever House, both on Park Avenue, as well as at 530 Park Avenue, a 19-story residential condominium. He also has five pieces by Picasso in his Manhattan home, and a controversial, 33-foot-tall bronze sculpture of a pregnant woman with an exposed fetus on the grounds of his estate in Old Westbury, on Long Island.

That $2.5 million, 13-ton sculpture by Damien Hirst [right] is one of 200 artworks that have put Mr. Rosen at the center of another controversy — this one involving unpaid taxes.

The New York attorney general, Eric T. Schneiderman, announced a $7 million settlement with Mr. Rosen on Tuesday for failing to pay taxes on $80 million in artwork that he had bought or commissioned since 2002.

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May 4, 2016 in Celebrity Tax Lore, Tax | Permalink | Comments (1)

Puckett:  Structural Tax Exceptionalism

James M. Puckett (Penn State), Structural Tax Exceptionalism, 50 Ga. L. Rev. 1067 (2015):

This Article argues that it is misleading to declare the death of tax exceptionalism and that structural tax exceptionalism may have important benefits. Part II provides a brief historical overview of the rise of federal agency administration of statutes and especially tax laws. The history trends to detract from anti-tax and anti-agency rhetoric that counsel disempowering the Treasury Department and other administrative agencies from comprehensively enforcing laws and making policy in their relevant domains.

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May 4, 2016 in Scholarship, Tax | Permalink | Comments (1)

Law School Rankings:  Federal Judicial Clerkships

Derek Muller (Pepperdine), Visualizing Law School Federal Judicial Clerkship Placement, 2013-2015:

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 2013, 2014, and 2015.

The Top 10 are:

  1. Yale (31.3%)
  2. Stanford (28.6%)
  3. Harvard (16.8%)
  4. Virginia (14.6%)
  5. UC-Irvine (13.6%)
  6. Chicago (13.5%)
  7. UC-Berkeley (11.0%)
  8. Duke (10.2%)
  9. Vanderbilt (10.1%)
  10. Michigan (9.4%)

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May 4, 2016 in Law School Rankings, Legal Education | Permalink | Comments (0)

IRS To Hire 700 New Enforcement Agents

IRS Logo 2Wall Street Journal, IRS to Hire Up to 700 Enforcement Workers:

The Internal Revenue Service is hiring up to 700 employees for tax enforcement in what Commissioner John Koskinen calls the agency’s “first significant enforcement hiring in more than five years.”

In a memo to employees Tuesday, Mr. Koskinen said the IRS found money for the hiring—despite budget constraints—because of retirements, other departures and unspecified “efficiencies.” The first wave of hiring will begin in a few weeks and will be concentrated in the IRS department that monitors small businesses and the self-employed.

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May 4, 2016 in IRS News, Tax | Permalink | Comments (5)

The Value Of Corporate Externships For Law Students

Kwak:  Reducing Inequality With A Retrospective Tax On Capital

James Kwak (Connecticut), Reducing Inequality with a Retrospective Tax on Capital, 25 Cornell J.L. & Pub. Pol'y 191 (2015):

Inequality in the developed world is high and growing: in the United States, 1% of the population now owns more than 40% of all wealth. In Capital in the Twenty-First Century, the economist Thomas Piketty argues that inequality is only likely to increase: invested capital tends to grow faster than the economy as a whole, causing wealth to concentrate in a small number of hands and eventually producing a society dominated by inherited fortunes. The solution he proposes, an annual wealth tax, has been reflexively dismissed even by supporters of his overall thesis, and presents a number of practical difficulties. However, a retrospective capital tax — which imposes a tax on the sale of an asset based on its (imputed) historical values — can reduce the rate of return on investments and thereby slow down the growth of wealth inequality. A retrospective capital tax mitigates or avoids the administrative and constitutional problems with a simple annual wealth tax and can reduce the rate of return on capital more effectively than a traditional income tax.

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May 4, 2016 in Scholarship, Tax | Permalink | Comments (2)