TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Monday, November 28, 2016

OECD:  Trump Tax And Spending Plans Will Double U.S. Economic Growth, Lift Global Economy

Texas Legislators Push For New Public Law School In The Rio Grande Valley Because 'Everybody Has A Law School'

Rio GrandeThe Monitor, Valley Legislators File Bills Asking For a Law School in the Area:

A new legislative year is bringing renewed hope for Rio Grande Valley representatives who hope to establish a law school in the area.

“The law school is a natural progression as our demographics grow, as our population grows,” said Eddie Lucio III, D-Brownsville. “There are some great, very talented young professionals who for financial reasons or reasons related to family cannot travel to San Antonio, which is our nearest law school.”

Lucio III and Armando “Mando” Martinez, D-Weslaco, both filed legislation — House Bill 169 and 46, respectively — last week calling for the establishment of a public law school in either Cameron or Hidalgo County.

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November 28, 2016 in Legal Education | Permalink | Comments (4)

The Investment Tax Credit And Immediate Expensing: Lessons In Cyclical Fiscal Activism

Mirit Eyal-Cohen (Alabama), Lessons in Cyclical Fiscal Activism, 48 Conn. L. Rev. 873 (2016):

This Article highlights an anomaly. It tells a story of two tax rules that were introduced at the same time to achieve a similar goal. Both were meant to be temporary and stimulate economic growth but received dramatically different outcomes. The Article reviews the reasons for this paradox. It demonstrates that the causes are structural, ideological, and political. It argues that the historical support the two mechanisms received diverged in accordance with their complexity, the perceptions they epitomized, and their instrumental role in society.

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November 28, 2016 in Scholarship, Tax | Permalink | Comments (0)

Trump’s Emolument Tax Problem

TrumpAndy Grewal (Iowa), The Trump Hotel Isn’t Unconstitutional, Yale J. on Reg.: Notice & Comment (Nov. 22, 2016):

Over the last few days, commentators have argued that President-Elect Trump’s business interests in the D.C.-based Trump Hotel may create constitutional problems under the Emoluments Clause. See, e.g., [Noah Feldman (Harvard)], Trump’s Hotel Lodges a Constitutional Problem, Bloomberg View (Nov. 21, 2016). As relevant here, the Emoluments Clause prevents a person holding a federal office from accepting any “present”  or “emolument” of any kind from any foreign country, unless Congress consents. Foreign diplomats have recently stayed at the Trump Hotel and this raises questions about whether, if this practice continues after inauguration, any lodging fees collected in connection with their stays would constitute the acceptance of a present (gift) or emolument by Trump.

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November 28, 2016 in Political News, Tax | Permalink | Comments (0)

Public Opinion Survey:  Should Governments Tax The Rich And Subsidize The Poor?

Robert W. McGee (Fayetteville State), Should Governments Tax the Rich and Subsidize the Poor? An Empirical Study of Opinion in the United States:

The present study reports the findings of a survey conducted by the World Values Survey scientists in the United States on the question of whether governments should tax the rich and subsidize the poor. The sample size of 2166 consisted of individuals from all parts of the United States. A 10-point Likert Scale was used to determine the extent of agreement or disagreement with the question. Various demographic variables were also examined to determine whether differences between groups were significant. Demographic variables included gender, age, marital status, social class, education level, region of the country, religion and ethnicity.

This study examines opinion in the United States on the question of whether it is a legitimate function of government to confiscate the property of the rich and distribute that property to the poor. ...

The questions asked:  Many things are desirable, but not all of them are essential characteristics of democracy. Please tell me for each of the following things how essential you think it is as a characteristic of democracy. Use this scale where 1 means “not at all an essential characteristic of democracy” and 10 means it definitely is “an essential characteristic of democracy”: Governments tax the rich and subsidize the poor.

Responses were measured on a 10-point Likert scale where 1 is “Not an essential characteristic of democracy” and 10 is “An essential characteristic of democracy.” The sample size was 2166.

Table 1 shows the overall results. The mean score of 5.04 indicates strong support for the view that confiscating the wealth of the rich to subsidize the poor is a legitimate function of democracy.

Table 1

Robert W. McGee (Fayetteville State), Should Governments Tax the Rich and Subsidize the Poor? An Empirical Study of Opinion in 59 Countries:

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November 28, 2016 in Scholarship, Tax | Permalink | Comments (5)

The IRS Scandal, Day 1299:  Ways & Means Chair Brady On How The House Has Reined In The IRS

IRS Logo 2Houston Chronicle op-ed: Reining In the IRS, by Kevin Brady (Chair, House Ways & Means Committee):

Over the last year, the Ways and Means Committee has led the "IRS Accountability Agenda" where House Republicans have approved a series of aggressive, Constitution-restoring legislation to reform the IRS and hold it accountable to the American taxpayer.

Our actions include:

Passing into law the first ban against the IRS targeting taxpayers or organizations based on their political beliefs. In June 2016, the House passed the Preventing IRS Abuse and Protecting Free Speech Act, which protects the identities of those who donate to tax-exempt organizations. This was in response to more IRS targeting of Americans.

Passing into law the Stolen Identity Refund Fraud Prevention Act which directs the IRS to take aggressive action to combat the growing problem of identity theft of confidential taxpayer information.

In April the U.S. House passed the Ensuring Integrity in the IRS Workforce Act, which prohibits the IRS from rehiring employees for misconduct, and the No Hires for the Delinquent IRS Act, which suspends the hiring of new IRS employees unless the Treasury Secretary certifies that no IRS employees have serious delinquencies with respect to their own tax obligations.

The same month the U.S. House passed legislation that prohibits the IRS from paying bonuses to employees until the Secretary of the Treasury implements a comprehensive customer service strategy that puts hardworking taxpayers first. And the House approved a bill that repeals the IRS's authority to spend the user fees it collects – restoring to Congress the full authority over how the IRS spends those resources. ... 

One of the most offensive actions by the IRS is its continued unlawful seizures of money and assets of innocent Americans, called civil asset forfeiture. After two years of aggressive oversight by the Ways and Means Committee in which IRS Commissioner John Koskinen apologized for the agency's actions, the U.S. House approved the Clyde-Hirsch-Sowers RESPECT Act, which puts in place important measures to prevent the IRS from wrongfully seizing the assets of law-abiding taxpayers. Since then, under bipartisan pressure the IRS has agreed to review its seizures of assets against hundreds of American taxpayers, and has begun to return the money stolen from these innocent Americans, many of them small business people and farmers merely depositing their daily and weekly receipts. Finally, some justice for those who have been harmed. And perhaps fewer Americans hurt in the future by unlawful seizures.

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November 28, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

TaxProf Blog Holiday Weekend Roundup

Sunday, November 27, 2016

Tax Policy In The Trump Administration

The Top 5 Tax Paper Downloads

SSRN LogoThis week's list of the Top 5 Recent Tax Paper Downloads is the same as last week's list. The #1 paper is now #9 in all-time downloads among 12,361 tax papers:

  1. [5,543 Downloads]  Families Facing Tax Increases Under Trump's Latest Tax Plan, by Lily L. Batchelder (NYU)
  2. [580 Downloads]  Aggressive Tax Planning & the Ethical Tax Lawyer, by Heather M. Field (UC-Hastings)
  3. [311 Downloads]  The Up-C Revolution, by Gregg D. Polsky (Georgia) & Adam H. Rosenzweig (Washington University)
  4. [280 Downloads]  Estate Planning for Digital Assets: Assigning Tax Basis and Value to Digital Assets, by Elizabeth Ruth Carter (LSU)
  5. [254 Downloads]  IRS Issues Final and Temporary Debt-Equity Regulations Under Section 385, by David S. Miller (Proskauer, New York) & Janicelynn Asamoto Park (Proskauer, New York)

November 27, 2016 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Kaplan:  Religion And Advance Medical Directives—Formulation And Enforcement Implications

Richard L. Kaplan (Illinois), Religion and Advance Medical Directives: Formulation and Enforcement Implications, 2016 U. Ill. L. Rev. 1737:

This Article examines the role of religion in the creation and enforcement of advance medical directives. It begins by setting out the principal similarities and differences between the two types of such directives—namely, living wills and health care proxies (or powers of attorney). It then considers the formulation of religiously oriented advance directives and their incorporation of religious doctrine and imperatives. The Article then addresses the impact that the religious views of an individual patient’s treating physician might have on such directives.

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November 27, 2016 in Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 1298: The IRS Scandal And A Trump-Ryan Constitutional Revival

IRS Logo 2Wall Street Journal op-ed: A Trump-Ryan Constitutional Revival: Wariness of Trump Might Inspire Republicans in Congress to Give Up Lazy Delegation and Relearn the Art of Legislating, by Christopher DeMuth (Hudson Institute):

A central purpose of the American scheme of checks and balances is to draw out the distinctive strengths of the two political branches, executive and the legislature, while containing their distinctive weaknesses.

The scheme has not been working well of late. The consequences are unbridled executive growth into every cranny of commerce and society, and a bystander Congress. We have lapsed into autopilot government, rife with corruption and seemingly immune to incremental electoral correction.

These pathologies were a significant cause of the Trumpian political earthquake. And one of the many astonishing results of Donald Trump’s presidential campaign and the Republican sweep on Election Day is that they have set the stage for a constitutional revival. ... [T]he new president and Congress are poised to revive constitutional practices in their own branches.

One of these practices is results-oriented policy making—so-called transactional politics—an approximation of what the Founders meant by “deliberation.” Another, “checks and balances,” is vigorous policy competition between the executive branch and Congress. Both practices have fallen into disuse in what had seemed, until now, to be a continuing downward spiral of dysfunctional government. ...

Congress is bound to recover and assert many of its long-neglected legislative prerogatives. In recent decades, our scheme of separated powers has been supplanted by party solidarity between presidents and their congressional co-partisans. (Separation of Parties, Not Powers is the title of an influential 2006 study of this development by Daryl J. Levinson and Richard H. Pildes.)

Members of Congress have increasingly acted out of loyalty to party rather than to Congress as an independent constitutional branch. They support or obstruct administration initiatives along partisan lines, and when in support they receive fundraising and bureaucratic favors from the president in return. During periods of party-unified government, congressional majorities delegate broad lawmaking powers to the executive, as in the Affordable Care and Dodd-Frank acts, that are almost impossible to recover when divided government returns. Congressional minorities allied with the president, employing the Senate filibuster and other supermajority rules, ensure that Congress turns a blind eye to executive abuses, as in the recent IRS and Veterans hospital scandals. ...

If [congressional Republicans] want to participate in charting new courses for health-care, tax and immigration policy and financial regulation, they are going to have to give up lazy policy delegation to the executive and relearn the arts of legislating and collective choice. And if President Trump should try to settle these and similarly momentous matters through Obama-style executive decrees, they are going to have to cry foul and make it stick.

The hard intraparty contention of the 2016 campaign has prepared the congressional Republicans for this. President-elect Trump’s obvious relish for transactional politics, and the largeness of his ambitions, suggests that he is prepared as well. The likely evanescence of Barack Obama’s Congress-free domestic and foreign initiatives—the already voided immigration policies, the Clean Power Plan, the Iran deal, national rules for bathroom etiquette—should inspire everyone to stay at the table. ...

These would be healthy developments for our constitutional order. Presidents have the strengths of action, decisiveness, high aspiration and a national political mandate—along with the weaknesses of overreaching, insularity and concentration of power. They oversee a bureaucratic empire too vast for any one man to keep track of, and so powerful that abuse and corruption are commonplace.

Congresses have the strengths of full-spectrum political representation, 535 state and local mandates, and responsiveness to shifting popular concerns and a soft spot for human-rights minorities at home and abroad—along with the weaknesses of parochialism, irresolution, decision-by-committee and herd mentality.

We need more of the strengths and less of the weaknesses. But transactional politics and interbranch rivalry are no guarantee of happy outcomes, which depend ultimately on the constitution of the participants. The record of tough-guy political outsiders is less than great. Businessman Silvio Berlusconi in Italy, and muscleman Arnold Schwarzenegger in California, came to office promising to upend the status quo. But when they discovered how entrenched and hard-bitten the status quo really was, they promptly folded, contented themselves with mere celebrity, and accomplished nothing.

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November 27, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Saturday, November 26, 2016

This Week's Ten Most Popular TaxProf Blog Posts

Law Student Loan Forgiveness 'May Be In Crosshairs' Of Trump Administration, Republican Congress

Trump (President Elect)National Law Journal, Trump's Election Fuels Worry Over Lawyer Loan Forgiveness:

President-elect Donald Trump offered few specifics on the campaign trail about student debt and the government's role in aiding those saddled with massive educational loans.

Now, student loan experts and public-interest advocates are parsing those sparse comments on the subject for clues about what a Trump administration means for current and future borrowers, lawyers and law students included.

Their takeaway? Good news for attorneys already practicing, and a precarious position for lawyers-to-be, especially those wanting public-interest jobs.

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November 26, 2016 in Legal Education | Permalink | Comments (6)

What Would A Libertarian Tax Look Like?

LibertarianJohn R. Dorocak (California State University, San Bernardino), What Would a Libertarian Tax Look Like?, 57 S. Tex. L. Rev. 147 (2015):

Libertarian ideas have been given attention, particularly recently, in academic, judicial, and political areas. Those who have been involved with taxation as practitioners or academicians at some point in time likely wrestle with the question of what should "fair" taxation look like. The goal here is not to discuss all philosophical underpinnings of a tax system, but rather to discuss how libertarians might frame a tax system.

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November 26, 2016 in Scholarship, Tax | Permalink | Comments (4)

The IRS Scandal, Day 1297: The Scorecard

IRS Logo 2Newsmax, IRS Denies Tax Exempt Status to 2 Tea Party Groups — After 7 Years:

After up to 7 years of intentionally delaying their cases, the IRS denied two Tea Party groups tax exempt status while approving one, The Washington Times reports.

The scorecard, published Monday by the Times, shows:

  • 2 denials (Albuquerque Tea Party and Tri Cities Tea Party from Washington).
  • 2 pending, including Texas Patriots Tea Party, part of a class action lawsuit.
  • 1 approval (Unite in Action from Michigan).

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November 26, 2016 | Permalink | Comments (1)

Friday, November 25, 2016

Weekly Tax Highlight And Roundup

This week, Joe Kristan (CPA & Shareholder, Roth & Company (Des Moines, Iowa); Editor, Tax Update Blog) discusses the importance of not paying other creditors before you pay payroll taxes to the IRS.

KristanNo good deed goes unpunished if you owe payroll taxes.

IRS>Employees. Pay the payroll taxes to the IRS, no matter who else you have to stiff. That’s the lesson of a sad court case out of Houston last week.

Dr. McClendon ran Family Practice Associates for 20 years. Sometime along the way his CFO started keeping the payroll taxes the practice was supposed to remit to the IRS for himself, until by 2009 $10 million was unpaid. The U.S. District Court Judge takes up the story (my emphasis, citations omitted):

Family Practice stopped operating and remitted its remaining receivables to the IRS to pay toward the tax liability. Dr. McClendon made a $100,000 personal loan to Family Practice “for the restricted purpose of . . . using the funds to pay the May 15, 2009 payroll.” Family Practice used that loan to pay its employees.

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November 25, 2016 in New Cases, Tax, Weekly Tax Roundup | Permalink | Comments (0)

Weekly SSRN Tax Article Review And Roundup

This week, Ari Glogower (Ohio State) reviews a new article by Lily Batchelder (NYU), The “Silver Spoon” Tax: How to Strengthen Wealth Transfer Taxation, in Delivering Equitable Growth: Strategies for the Next Administration (Washington Center for Equitable Growth, Fall 2016).

Glogower (2016)Lily Batchelder’s new work examines the reform options for taxing wealth transfers. 

The argues that that wealth transfer taxes are an essential tool for mitigating economic inequality – as measured by both disparities of wealth, income and other measures of economic well-being, and by disparities of economic opportunity. Wealth transfer taxes are also relatively efficient, since taxpayers save for the purposes of enjoying wealth while they are alive (and the social benefits wealth affords) and for retirement needs, in addition to merely accumulating bequests for future generations. Batchelder argues that wealth transfer taxes may also efficiently counter the decreased work incentive among heirs. 

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November 25, 2016 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Legal Education Roundup

The IRS Scandal, Day 1296: Will Koskinen Resign As IRS Commissioner At Trump's Request?

IRS Logo 2Politico Morning Tax, It’s On. Still:

If you thought Donald Trump’s win last week might soften Rep. Jim Jordan’s desire to impeach IRS Commissioner John Koskinen — well, you were wrong.

As our Katy O’Donnell reports, Jordan (R-Ohio), the chairman of the House Freedom Caucus, used the occasion of the IRS denying the Albuquerque Tea Party tax-exempt status to put a jolt into his impeachment efforts. Jordan called that decision just the latest sign that “Koskinen continues in his dereliction of duty. Congress must move forward on impeaching him.”

As Katy also notes, Koskinen isn’t likely to sound daunted by the threat, having noted previously that the votes just don’t seem to be there in the House for impeachment. He’s also said that a federal judge’s recent statement that the IRS might still be improperly singling out tea party groups — which Jordan cited on Monday — was mistaken.

What does it all mean? It’s pretty clear that House GOP leaders really don’t feel the need to tackle impeachment. But Koskinen, who has about a year left on his term, has also suggested that he’d leave if the next president doesn’t want him to lead the agency — which certainly seems like a possibility, at least.

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November 25, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (9)

Thursday, November 24, 2016

Law Profs: Take The Pledge For The Public Good

TakeAlexi Freeman (Denver) & Katie Steefel (Denver), The Pledge for the Public Good: A Student-Led Initiative to Incorporate Morality and Justice in Every Classroom, 22 Wash. & Lee J. C.R. & Soc. Just. 49-106 (2016):

"The first thing I lost in law school was the reason I came." This is the disheartening reality for countless law students. While legal education has made great strides towards diversifying its offerings and expanding its focus over time, the struggle to maintain one's vision and identity, especially if such things connect to the public interest, remains challenging. Some notable exceptions exist, but overall, law schools often still underserve those who are public interest focused and fail to graduate many students who devote themselves to serving the public good.

While the climate at our school is supportive and embracing of public interest, and efforts to do even more are on the rise, the University of Denver Sturm College of Law (Denver Law) is no exception. To move any law school to "the other side" that only a few are privileged to be a part of, large-scale, long-term transformation is needed to connect public interest to all aspects of culture and curriculum. The consumers of legal education—the students—can play a major role in jumpstarting this transformation. At Denver Law, the Chancellor's Scholars did just that with the creation of the Pledge for the Public Good.

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November 24, 2016 in Legal Education | Permalink | Comments (2)

Penn State Issues Call For Tax Papers

Penn StateThe Penn State Journal of Law & International Affairs has issued a call for tax papers:

The Penn State Journal of Law & International Affair (“JLIA”) is conducting a call for papers for an upcoming publication in spring 2017. The publication will focus on areas of taxation, corporate law, banking and finance, and related subject areas. Current papers accepted for publication cover areas of international taxation, international financial regulation for cryptocurrencies, and regulations resulting from the global financial crisis.

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November 24, 2016 in Scholarship, Tax | Permalink | Comments (0)

WKRP in Cincinnati Thanksgiving Turkey Drop

November 24, 2016 in Legal Education, Tax | Permalink | Comments (1)

The IRS Scandal, Day 1295: If Koskinen Is Impeached Or Fired, Trump Could Appoint New IRS Commissioner To Go Easy On His Taxes

IRS Logo 2Politico, Trump Gets to Pick His Own Auditor: Lawyers Say There's Nothing to Stop Him From Appointing an IRS Chief Who Will Go Easy on Him:

President-elect Donald Trump will soon be able to appoint a new director of the agency auditing his taxes, a potential political minefield after his writeoffs and his refusal to release his returns were repeatedly questioned in the campaign.

The president is barred from directing how the IRS treats specific taxpayers, but lawyers say there’s nothing to stop Trump from appointing an IRS chief who will go easy on him while scrutinizing his political enemies.

“There is precious little statutorily that prohibits that,” said Caplin & Drysdale tax lawyer Chris Rizek, who served in the Treasury Department’s Office of Legislative Counsel under former president Clinton.

Trump could have the opportunity to put his own IRS chief into place quickly, even though the IRS commissioner serves a fixed five-year term to shield the agency from presidential politics. Current Commissioner John Koskinen, whose term ends next November, is facing potential impeachment in the House over his handling of investigations, and he could come under pressure to resign before Trump takes office. House Freedom Caucus Chairman Jim Jordan reiterated his call for impeachment this month, and lobbyists expect Trump to give Koskinen the boot to throw conservatives a bone. ...

The IRS also reviews the president’s and vice president’s returns each year, but those audits aren’t required by law, and Trump could stop them. “They don’t need Congress’ approval to change that,” [Valparaiso Law Professor David] Herzig said. “It might raise red flags politically. But you could just change it, or you could just not enforce that part about presidential audits.” ...

Trump is taking office at a time when the IRS has already been weathering accusations that its audits are politically motivated.

The IRS admitted to using “Be On the Lookout” lists to target political groups seeking tax-exempt status in May 2013, after an inspector general audit found the agency was using “inappropriate criteria” to flag “Tea Party and other organizations…based upon their names or policy positions.” No evidence was ever uncovered the White House had anything to do with scandal, but some conservatives argue President Obama in effect sent a dog whistle audit plea by publicly criticizing political social welfare groups, prodding former IRS official Lois Lerner to take it upon herself to act.

Koskinen himself says that the tea party controversy, which he was brought in to clean up, should illustrate the importance of a nonpolitical, independent IRS.

“It’s reemphasized the importance of making sure that there isn’t a question about the IRS being political,” Koskinen maintained.

For the most part, the IRS has gotten pretty good at shrugging off political pressures, tax lawyers said.

“It is not at all uncommon for people to clamor for IRS or DOJ activity or criminal investigation, and the IRS kind of takes the position that they ignore that political pressure. I have not heard of any instance since 1973 of anyone at the White House calling anyone at the IRS to ask for an audit or put pressure on a taxpayer,” [Chris Rizek, who served in the Treasury Department’s Office of Legislative Counsel under former president Clinton] said. “Because if that got out it would be a pretty outrageous news story.”

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November 24, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Wednesday, November 23, 2016

Will Trump Treat The Presidency As A Part-Time Job For Tax Purposes?

White House LogoWashington Post: Will Trump Claim That Being President Is a Part-Time Job — For Tax Purposes?, by Allan Sloan:

Can you imagine anyone saying that being president of the United States is only a part-time job? Well, Donald Trump might have an incentive to say just that.

That sounds bizarre. But I think it’s within the realm of possibility for Trump to claim in future years that things such as living in Trump Tower rather than the White House and mentioning his properties at every opportunity are promotional activities. If he can show that he spends more than half his time developing, managing and promoting real estate, it could shelter millions of dollars of his non-real-estate income from federal income tax.

I’m not saying that Trump plans to play this particular tax game. But given that he won’t disclose his tax returns, as presidents and presidential candidates have done for decades — and given how aggressive he’s been about cutting his personal tax bill — it doesn’t seem so far-fetched. ...

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November 23, 2016 in Political News, Tax | Permalink | Comments (2)

Shearman & Sterling Joins Growing BigLaw Trend In De-Equitizing Partners: 'Shearminations'

ShearmanNew York Times: Law Firms, Struggling Financially, Cull Partner Ranks, by Elizabeth Olson:

Wrestling with a difficult market, some big law firms are demoting partners — meaning they are no longer owners in the firm who share in annual profits.

The latest to publicly weigh such a step is Shearman & Sterling, a powerhouse New York firm that indicated recently that it would revamp itself, primarily through demotions and delays in promotions to full partnership status.

Demoting, or even cutting, partners is not new in the legal industry. A decade ago, the efforts at Shearman & Sterling to jettison unproductive partners were called “Shearminations.” But it is a tool the legal industry once wielded sparingly.

“It’s back now because there is a growing recognition that demand for legal services is not picking up and firms are facing overcapacity issues,” said Peter Zeughauser, a law firm consultant.

Some firms have been quietly weeding their partner ranks as a result. In a process called de-equitizing, law firms set retirement dates for certain equity partners or reduce them to salaried status, cutting them out of the yearly profit distribution. ...

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November 23, 2016 in Legal Education | Permalink | Comments (0)

Concord Law School Seeks Permission For Its Graduates To Take The Bar Exam In States Other Than California

Concord Logo (2016)ABA Journal, For-Profit Concord School of Law Seeks More State Bar Exam Opportunities For its Grads:

The Concord Law School of Kaplan University, which offers online courses, in the past month has filed petitions in Arizona, New Mexico and Connecticut, asking the states to change existing rules that restrict its graduates from taking bar exams.

California is currently the only state that allows Concord graduates to sit for its state bar exam as first-time test takers, says Martin Pritikin, the for-profit law school’s dean and vice president. He expects to file more petitions on other states.

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November 23, 2016 in Legal Education | Permalink | Comments (0)

Kaplan:  The Cadillac Tax And Its Potential To Transform How Americans Purchase Health Care Services

Richard Kaplan (Illinois), The Cadillac Tax and Its Potential to Transform How Americans Purchase Health Care Services, 2016 NYU Rev. Em. Ben. & Exec. Comp.:

This Article examines one of the most contentious provisions of the Affordable Care Act — namely, the 40% excise tax on high-value health insurance provided by employers. This levy, commonly denominated the “Cadillac” tax, is scheduled to take effect in 2020 but has already induced many employers to raise annual deductibles on the health insurance they provide to reduce the value of such insurance and thereby lower their exposure to this new tax.

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November 23, 2016 in Scholarship, Tax | Permalink | Comments (0)

Law School Student Debt Rankings

2017 U.S. News LogoJD Journal, Law School Debt Rankings — Law Schools with the Highest Debt:

U.S. News and World Report analyzed the indebtedness of law school graduates in 2015, and they discovered a huge gap between the school with the highest student debt, Thomas Jefferson School of Law, and the least, University of Hawaii-Manoa. To no one’s surprise, the majority of graduates had student loan debt, but what was shocking about this list was that even the non-top ranked schools came with a heavy price tag for students.

Here are the ten law schools with the highest student debt, and the ten law schools with the lowest student debt:

Top 10

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November 23, 2016 in Law School Rankings, Legal Education | Permalink | Comments (6)

Trump Foundation Form 990-PF Admits To Violating Ban On ‘Self-Dealing’

WSJ:  Many Deans Resist Law School Accreditors Raising The Bar—'Nobody Looks At Job Outcomes Of PhDs, MBAs'

WSJWall Street Journal, Law School Accreditors Raising the Bar:

With the percentage of fledgling lawyers failing state licensing exams on the rise, national accreditors are getting tough and telling law schools to better prepare students for legal practice or risk losing their accreditation.

The American Bar Association, which oversees the nation’s more than 200 accredited law schools, is working on a new rule that would require 75% of a law school’s graduates sitting for a bar exam to pass it within two years.

The proposal, which recently cleared a key administrative hurdle and could be implemented early next year, is rankling some law schools that say it will unfairly hurt those institutions with a mission of increasing access to legal education to a more diverse array of students.

Others say a national standard makes little sense when some states, such as California and New York, have notoriously more difficult bar exams than others.

“Nobody looks at what percentage of Ph.D.s end up as college professors, or what percentage of M.B.A.s achieve their goal,” said Gilbert Holmes, the dean of University of La Verne College of Law in California, who opposes the rule.

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November 23, 2016 in Legal Education | Permalink | Comments (8)

The IRS Scandal, Day 1294: House Republicans Will Try To Oust IRS Commissioner Koskinen This Month

IRS Logo 2Washington Examiner, Conservatives Will Try to Oust IRS Chief This Month:

Rep. Tim Huelskamp will call for a post-election vote to impeach IRS Commissioner John Koskinen when Congress returns from Thanksgiving recess, he told the Washington Examiner.

Huelskamp, R-Kan., said he has no plans to drop his effort to oust Koskinen, whose term does not expire until November 2017. "We need to clean house, especially at the IRS," Huelskamp said.

Huelskamp said Koskinen could pre-empt a vote by announcing he will retire when Republican President-elect Trump takes office in January. "But barring that, I anticipate that two weeks from now we will introduce that resolution," Huelskamp said.

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November 23, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (9)

Tuesday, November 22, 2016

July 2016 California Bar Exam Carnage

The California State Bar has released the results from the July 2016 bar exam.  The overall pass rate was 43%, the lowest in 32 years.  For California ABA-accredited law schools, the pass rate fell 6.2 percentage points from 2015, to 62%, down 21 percentage points from 2008. 

California Bar

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November 22, 2016 in Legal Education | Permalink | Comments (10)

Alstott Presents A New Deal For Old Age: Toward A Progressive Retirement Today At Columbia

Old AgeAnne Alstott (Yale) presents A New Deal for Old Age: Toward a Progressive Retirement at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium Series hosted by Alex Raskolnikov and Wojciech Kopczuk:

A growing chorus of policy analysts is calling for an increase in the Social Security retirement age. Even staunch defenders of Social Security have begun to concede that the retirement age of 66 is too low, in light of the increasing longevity, improving health, and expanding work options of older Americans. Still, some progressives worry that the only way to protect disadvantaged workers is to leave the early and full retirement ages as they are. The result is a debate that pits intergenerational fairness against intragenerational fairness: either we shortchange the young (by paying unneeded benefits to the old) or else we shortchange the disadvantaged (by raising the retirement age to levels that are unrealistic for low-earners).

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November 22, 2016 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

New Website Seeks To Register Professors Accused of Liberal Bias

ProfessorInside Higher Ed, Being Watched: New Website Seeks to Register Professors Accused of Liberal Bias and “Anti-American Values”

A new website is asking students and others to “expose and document” professors who “discriminate against conservative students, promote anti-American values and advance leftist propaganda in the classroom.”

The site, called Professor Watchlist, is not without precedent -- predecessors include the now-defunct NoIndoctrination.org, which logged accounts of alleged bias in the classroom. There's also David Horowitz's 2006 book, The Professors: The 101 Most Dangerous Academics in America. But such efforts arguably have new meaning in an era of talk about registering certain social groups and concerns about free speech.

At the same time, the new list has attracted Twitter jokesters under the hashtag #trollprofwatchlist, with complaints about Indiana Jones, Professor Plum of "Clue University," and Gilderoy Lockhart from Harry Potter's Hogwarts School of Witchcraft and Wizardry, among others.

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November 22, 2016 in Legal Education | Permalink | Comments (5)

Fleming, Peroni & Shay:  Two Cheers For The Foreign Tax Credit

J. Clifton Fleming Jr. (BYU), Robert J. Peroni (Texas) & Stephen E. Shay (Harvard), Two Cheers for the Foreign Tax Credit, Even in the BEPS Era, 91 Tulane L. Rev. 1 (2016):

Reform of the U.S. international income taxation system has been a hotly debated topic for many years. The principal competing alternatives are a territorial or exemption system and a worldwide system. For reasons summarized in this article, we favor worldwide taxation if it is real worldwide taxation – i.e., a non-deferred U.S. tax is imposed on all foreign income of U.S. residents at the time the income in earned. This approach is not acceptable, however, unless the resulting double taxation is alleviated. The longstanding U.S. approach for handling the international double taxation problem is a foreign tax credit limited to the U.S. levy on the taxpayer’s foreign income. Indeed, the foreign tax credit is an essential element of the case for worldwide taxation. Moreover, territorial systems often apply worldwide taxation with a foreign tax credit to all income of resident individuals plus the passive income and tax haven income of resident corporations. Thus, the foreign tax credit is actually an important feature of many territorial systems.

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November 22, 2016 in Scholarship, Tax | Permalink | Comments (0)

Sandy Levinson Receives Hateful Postcard

Sandy Levinson (Texas), who is visiting at Harvard Law School this semester, received this hateful postcard in the mail:

Sandy Levinson

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November 22, 2016 in Legal Education | Permalink | Comments (10)

How Republicans Plan To Spend Like Crazy Without Running Up Debt

Bloomberg, How Republicans Plan to Spend Like Crazy Without Running Up Debt:

When Washington argues about fiscal policy, it’s really fighting over models. By the time the White House produces its budget, its Office of Management and Budget has already modeled what it hopes that budget will do. Majorities in Congress send their budget resolutions to their own preferred think tanks for modeling, too. Then, by statute, bills that come out of most committees must receive a “score”—a modeled result—from the Congressional Budget Office and, for revenue bills, the Joint Committee on Taxation. The CBO and the JCT have a reputation for straight-backed probity, but congressional staffers quietly haggle with both institutions over footnotes.

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November 22, 2016 in Tax | Permalink | Comments (2)

Tax Policy In The Trump Administration

The IRS Scandal, Day 1293: WSJ— Has The Obama Administration Been 'Long On Dignity And Short On Scandal'?

IRS Logo 2Wall Street Journal: A Crisis of Authority—II, by James Taranto:

[I]n a lengthy series of interviews, both pre- and postelection, with the New Yorker’s David Remnick, Obama has been quite fretful—torn, as at that press conference, between his duty as a lame-duck president to respect the office and the man who will soon hold it, and his anguish at what amounts to a repudiation of authority. ...

Remnick himself described the Obama presidency as “two terms long on dignity and short on scandal.” The IRS? The State Department scandal that arguably sank Mrs. Clinton’s campaign? Again, the memory hole.

In Lima on Sunday the president himself declared: “I am extremely proud of the fact that over eight years we have not had the kinds of scandals that have plagued other administrations.” That’s either delusional or very carefully worded: To our knowledge no other administration has used the IRS to punish ordinary citizens for dissent, nor faced FBI findings that the secretary of state treated classified information in an “extremely careless” fashion.

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November 22, 2016 in IRS News, IRS Scandal | Permalink | Comments (4)

Monday, November 21, 2016

Shaviro Presents The Mapmaker’s Dilemma In Evaluating High-End Inequality Today At NYU

Shaviro (2015)Daniel Shaviro (NYU) presents The Mapmaker’s Dilemma in Evaluating High-End Inequality at NYU today as part of its High-End Inequality Colloquium Series (more here):

The last thirty years have witnessed rising income and wealth concentration among the top 0.1 percent of the population, leading to intense political debate regarding how, if at all, policymakers should respond. Often, this debate emphasizes the tools of public economics, and in particular optimal income taxation. However, while these tools can help us in evaluating the issues raised by high-end inequality, their extreme reductionism — which, in other settings, often offers significant analytic payoffs — here proves to have serious drawbacks.

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November 21, 2016 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Financial Times Special Section On Law Schools:  
The Admissions Collapse Continues

Financial Times (2017)Financial Times, Law School Admissions Collapse Continues: They Are Being Forced to Innovate or Face Being Left Behind:

Since 2010, US law schools have experienced a drop in student admissions to a level not seen since 1973, when there were 53 fewer schools than today (204). The number of first-year students entering law school in 2015 dropped to just above 37,000 compared to 52,000 in 2010, according to figures released by the American Bar Association. The latest enrolment numbers are due in December.

FT Chart 2

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November 21, 2016 in Legal Education | Permalink | Comments (6)

National Taxpayer Advocate:  The IRS Is Out Of Touch With The People It Serves

Taxpayer Advocate (2016)Accounting Web, Nina Olson: IRS Out of Touch with the People it Serves:

National Taxpayer Advocate Nina Olson minced few words in a recent assessment of the future of the IRS and its current interactions with taxpayers: The agency’s growing disconnect from the people it serves will lead to its failure.

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November 21, 2016 in IRS News, Tax | Permalink | Comments (4)

#AcademicHumblebrags

HumblebragInside Higher Ed, Academic Humblebrags:

Consider the humblebrag, a seemingly modest utterance that’s actually a boast. ...

  • Gosh, if I don’t send in that manuscript to Oxford by this fall, they’re gonna kill me!
  • You know, if it weren’t for all the grateful letters that I’ve gotten from students over the years, I’d’ve given up teaching a long time ago.
  • I’m sure plenty of people could have delivered the keynote address at this conference, but I’m the one who got suckered into it.
  • Never mind all my publications. The teaching award I got this year makes me realize what really matters in life.

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November 21, 2016 in Legal Education | Permalink | Comments (0)

ATPI Conference:  Improving The Tax System Using Advances In Social Knowledge And Technology

ATPI Logo (2014)The American Tax Policy Institute sponsored a conference on Improving the Tax System Using Advances in Social Knowledge and Technology at Skadden's Washington, D.C. office on Friday:

Panel 1:  How behavioral economics relates to and might be taken into account in developing tax policy and administration

  • James Alm (Tulane) (Panel Chair)
  • Mike Hawkins (HM Revenue & Customs)
  • Steven M. Sheffrin (Tulane)
  • Eric LoPresti (Taxpayer Advocate Service, IRS)

Panel 2:  Using social science to improve the tax system and promote voluntary compliance

  • Susan C. Morse (Texas) (Panel Chair)
  • Joseph Bankman (Stanford)
  • John Guyton (Office of Research, Applied Analytics & Statistics, IRS)
  • Ronald Hodge (Office of Research, Applied Analytics & Statistics, IRS)
  • Kathleen DeLaney Thomas (North Carolina)

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November 21, 2016 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Law Profs Weigh In On The Hamilton/Pence/Trump Controversy

The IRS Scandal, Day 1292: Boston Herald Editorial—IRS Scandal Belies President Obama's Claim That His Has Been A Scandal-Free Administration

IRS ScandalBoston Herald editorial, Scandal 'Free' Obama:

“I am very proud of the fact that we will — knock on wood — leave this administration without significant scandal.” — President Obama at his Nov. 14 news conference.

Ah, the lie oft repeated . . .

Define scandal. Or perhaps “significant scandal.”

Well, let’s start with the IRS scandal — or is there another word for what happens when public officials in one of government’s most sensitive departments make decisions based on ideology. Let’s see, how about when any organization with the words “tea party” in its name applies for tax-exempt status? Lois Lerner, who headed the tax exempt division resigned.

But guess that’s only a “significant scandal” for those groups still waiting to hear back from the IRS. ...

No scandal here, folks. Just move along.

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November 21, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

TaxProf Blog Weekend Roundup

Sunday, November 20, 2016

NY Times:   After Critical Inspector General Report, IRS Cracks Down On Bitcoin Users

Bitcoin IRSNew York Times, Bitcoin Users Who Evade Taxes Are Sought by the IRS:

The IRS is on the hunt for people who used Bitcoin to evade taxes.

The tax agency sent a broad request on Thursday to Coinbase, the largest Bitcoin exchange in the United States, asking for the records of all customers who bought virtual currency from the company from 2013 to 2015.

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November 20, 2016 in IRS News, Tax | Permalink | Comments (0)

129 College Presidents Send Letter Asking President-Elect Trump To Condemn 'Harassment, Hate And Acts Of Violence'

Trump (President Elect)Inside High Ed:

Dear President-elect Trump,

As do you, we “seek common ground, not hostility; partnership, not conflict.” In order to maintain the trust required for such productive engagement, it is essential that we immediately reaffirm the core values of our democratic nation: human decency, equal rights, freedom of expression and freedom from discrimination. As college and university presidents, we commit ourselves to promoting these values on our campuses and in our communities, and we stand alongside the business, nonprofit, religious and civic leaders who are doing the same in organizations large and small.

In light of your pledge to be “President for all Americans,” we urge you to condemn and work to prevent the harassment, hate and acts of violence that are being perpetrated across our nation, sometimes in your name, which is now synonymous with our nation’s highest office. In our schools, on job sites and college campuses, on public streets and in coffee shops, members of our communities, our children, our families, our neighbors, our students and our employees are facing very real threats, and are frightened.

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November 20, 2016 in Legal Education, Political News | Permalink | Comments (15)

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. The #1 paper is now #19 in all-time downloads among 12,340 tax papers:

  1. [4,594 Downloads]  Families Facing Tax Increases Under Trump's Latest Tax Plan, by Lily L. Batchelder (NYU)
  2. [522 Downloads]  Aggressive Tax Planning & the Ethical Tax Lawyer, by Heather M. Field (UC-Hastings)
  3. [299 Downloads]  The Up-C Revolution, by Gregg D. Polsky (Georgia) & Adam H. Rosenzweig (Washington University)
  4. [271 Downloads]  Estate Planning for Digital Assets: Assigning Tax Basis and Value to Digital Assets, by Elizabeth Ruth Carter (LSU)
  5. [223 Downloads]  IRS Issues Final and Temporary Debt-Equity Regulations Under Section 385, by David S. Miller (Proskauer, New York) & Janicelynn Asamoto Park (Proskauer, New York)

November 20, 2016 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)