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Tuesday, April 21, 2015

Bloomberg's Zachary Mider Wins Pulitzer Prize For His Tax Reporting

BloombergThe 2015 Pulitzer Prize Winners: Explanatory Reporting:

Awarded to Zachary R. Mider of Bloomberg News for a painstaking, clear and entertaining explanation of how so many U.S. corporations dodge taxes and why lawmakers and regulators have a hard time stopping them.  [Photo: Bloomberg News Wins Pulitzer for Explanatory Reporting.]

Here are links to some of Zachary's tax reporting over the past year:

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April 21, 2015 in Tax | Permalink | Comments (0)

New York Law Journal Special Report: Law Schools

NYLJNew York Law Journal Special Report: Law Schools:

Jeremy Paul (Dean, Northeastern), Changing the 'How' But Not the 'Why':

Law school applications are declining more slowly and entry level hiring has begun to recover. First-year law school enrollments have shrunk from more than 52,000 in 2010 to a far more sustainable 38,000 in 2014. Recent studies by Profs. Frank McIntyre and Michael Simkovic continue to vindicate the long-run earning power of the J.D. degree. Perhaps you can hear law school deans breathing sighs of relief. Alas, it is way too soon for that.

Law schools that view nascent positive trends as license to return to business as usual will be missing the far more profound changes in the legal profession that demand new approaches to legal education. The most significant change is the extent to which knowledge of the law is cheaper and easier to obtain for everyone with access to a computer. Future lawyers can expect to earn less for merely informing clients about the law. How lawyers will add value in this changed environment is the question of the day. How lawyers should be trained to do so should be a top priority for every legal educator in the United States.

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April 21, 2015 in Legal Education | Permalink | Comments (5)

Eyal-Cohen: Lessons in Fiscal Activism

Mirit Eyal-Cohen (Alabama), Lessons in Fiscal Activism:

This article highlights an anomaly. It shows that two tax rules aimed to achieve a similar goal were introduced at the same time. Both meant to be temporary and bring economic stimuli but received a dramatically different treatment. The economically inferior rule survived while its superior counterpart did not. The article reviews the reasons for this paradox. It shows that the causes are both political and an agency problem. The article not only enriches an important and ongoing debate that has received much attention in recent years, but also provides important lessons to policymakers.

April 21, 2015 in Scholarship, Tax | Permalink | Comments (0)

14th Annual Conducting Empirical Legal Scholarship Workshop

Wash.U. LogoThe 14th Annual Workshop on Conducting Empirical Legal Scholarship, co-taught by Lee Epstein (Washington University) and Andrew D. Martin (Michigan), will run from June 15-17 at Washington University in St. Louis. The workshop is for law school faculty, lawyers, political science faculty, and graduate students interested in learning about empirical research and how to evaluate empirical work. It provides the formal training necessary to design, conduct, and assess empirical studies, and to use statistical software (Stata) to analyze and manage data.

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April 21, 2015 in Conferences, Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 712

IRS Logo 2National Review, The IRS Assures an Atheist Group It Will Monitor Churches:

It was bad enough, as I wrote here last August, that the Internal Revenue Service appeared to reach an agreement to monitor the pulpits of ill-favored churches. What’s worse is that the IRS, directly counter to Freedom of Information Act (FOIA) requirements, steadfastly has refused to make public key documents pertaining to that decision.

So the IRS, acting with the whole power of government behind it, seems to be saying it can monitor and presumably punish churches for the content of their sermons, but the churches can’t know exactly if, how, and why they are being monitored.

To fight this combined assault on religious liberty and on government transparency, conservative legal stalwarts Alliance Defending Freedom (ADF) and Judicial Watch together filed suit April 9 to force release of the IRS documents. ADF asserts that the IRS already has shared the documents with the atheist Freedom From Religion Foundation (FFRF). Once again, the IRS bends over backwards on behalf of leftists while harassing and ignoring the rights, on multiple levels, of conservative groups or faith communities.

And if the IRS continues to flout FOIA, we ought to treat its obstinacy as a major scandal. Then again, the IRS’s connivance with FFRF is itself a scandalous and deliberate trampling of our founding freedom of religious exercise and expression, guaranteed by the First Amendment.

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April 21, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Monday, April 20, 2015

Field Presents Aggressive Tax Planning and the Ethical Tax Lawyer Today at Pepperdine

Field (2015)Heather Field (UC-Hastings) presents Aggressive Tax Planning and the Ethical Tax Lawyer at Pepperdine today as part of our Tax Policy Colloquium Series:

[H]ow should a tax planner, who wants to engage in “permissible tax planning” but not cross the line over into “unethical loophole lawyering,” exercise her discretion and judgment? This paper seeks to answer this question by drawing on both (a) the extensive literature on lawyering and professionalism and (b) the social science literature regarding factors that contribute to biased decision-making and unintentional lapses in judgment. The explicit incorporation of these strands of literature into the discourse on tax ethics helps each tax planner operationalize, on an individual basis and in a way that aligns with her values, both the general and tax-specific rules of professional conduct. The existing tax ethics literature primarily focuses either on how to comply with the rules governing practice or on how the rules should be improved. Thus, this paper contributes to the literature by focusing on the issues that the rules leave to the discretion of the tax practitioner (rather than on the issues that the rules address) and by approaching the discussion from a lawyering perspective20 (rather than from a policymaking perspective).

Specifically, this paper argues that a lawyer seeking to pursue a career as an ethical tax planner should identify and implement her philosophy of lawyering to help her make difficult discretionary decisions in a principled way, and when implementing that approach to lawyering, she should work to counteract the subtle factors that can skew her professional judgment. ...

Ultimately, this paper argues that an important part of being an ethical tax planner, particularly when dealing with contestable tax positions, includes being deliberate about how one approaches the task of giving tax planning advice and being self-aware about the ways in which one exercises judgment. By fleshing out the concept of ethical tax planning, I hope to give our students confidence and guidance as they embark on (hopefully, ethical) careers as tax planners, and I hope to ease the tension between tax academics’ scholarly work condemning aggressive tax planning and their classroom work, in which they often teach students how to use those same tax planning techniques. And perhaps this limited defense of the ethics of the tax planning profession can help to rehabilitate the public image of tax lawyers.

Update:  Post-presentation lunch:

Field

April 20, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Yale: Anti-Basis

Ethan Yale (Virginia), Anti-Basis, 94 N.C. L. Rev. ___ (2015):

Anti-basis is the untaxed benefit enjoyed by a taxpayer when a liability or obligation is incurred. In the business context, the untaxed benefit is an increase in asset basis or a tax deduction. In the personal context, the untaxed benefit might take one of those forms, or it might be (nondeductible) personal consumption. A well-functioning income tax system must keep track of any such untaxed benefit. If the liability from which the benefit derived is avoided by the taxpayer, the prior untaxed benefit must be taken into income (or must reduce basis). If there was no prior untaxed benefit relating to a liability, exceptions are necessary to various rules requiring income recognition (or basis reduction) on discharge or shifting of liabilities.

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April 20, 2015 in Scholarship, Tax | Permalink | Comments (0)

82% Of Lawyers Say Demanding Work Schedules Are Damaging Their Health

82%ABA Journal, Demanding Work Schedules Are Damaging Their Health, Say 82% of Surveyed Lawyers:

The demands of work at leading law firms in the United States and United Kingdom are quantified in a new survey that found 22 percent of senior lawyers and partners work every weekend, and more than 10 percent work an average of 70 or more hours a week.

Brutal work schedules are taking a toll, according to the survey by Legal Week (sub. req.). Eighty-two percent of the surveyed lawyers believe long hours at work are damaging their health. The results are from a survey of 267 partners and senior lawyers at leading U.K. and U.S. law firms.

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April 20, 2015 in Legal Education | Permalink | Comments (2)

NY Times: Are You Receiving A Marriage Penalty Or Bonus?

New York Times, Are You Receiving a Marriage Penalty or Bonus?:

Nick Kasprak, a developer at the Center on Budget and Policy Priorities, and Kyle Pomerleau, an analyst at the Tax Foundation, have calculated marriage penalties or bonuses for thousands of hypothetical couples with total wages between $10,000 and $1 million.

In marriages without children, the largest bonuses, in percentage terms, occur when couples have income just under $100,000 and only one earner. These couples pay about 7 percent of their income, or $7,000, less in taxes than they would if they were forced to file as two single individuals.

The largest marriage penalties are for those who earn around $17,000, split evenly. These couples pay about 4 percent of their income, or $700, more in taxes than they would if they were allowed to file as two single individuals.

NYT

FiveThirtyEight, Should You Get Married (Or Divorced) For Tax Reasons?:

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April 20, 2015 in Tax | Permalink | Comments (0)

NALP's 'Muddled, False and Damaging' Reporting on Law Student Job Placement

NALP New LogoFollowing up on Friday's post, Welcome To Your First Year As A Lawyer. Your Salary Is $160,000.:  Deborah Jones Merritt (Ohio State), Overpromising:

Earlier this week, I wrote about the progress that law schools have made in reporting helpful employment statistics. The National Association for Law Placement (NALP), unfortunately, has not made that type of progress. On Wednesday, NALP issued a press release that will confuse most readers; mislead many; and ultimately hurt law schools, prospective students, and the profession. It’s the muddled, the false, and the damaging. ...

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April 20, 2015 in Legal Education | Permalink | Comments (4)

Death of Chuck Davenport

DavenportNeil H. Buchanan (George Washington),  Charles Davenport, Rest In Peace:

Chuck Davenport died last week.  I admired him greatly.  Chuck was the senior tax law professor at Rutgers-Newark when I was on the entry-level market for legal academics.  When I visited Newark for my job talk, Chuck came to the small dinner the night that I arrived, and I immediately knew that I had met a kindred spirit.  It was clear that we were politically similar (for example, he positively compared my thinking with that of John Kenneth Galbraith -- a generous compliment that would turn anyone's head!), but that was not what really mattered.  Chuck was just so easy to like.

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April 20, 2015 in Legal Education, Obituaries, Tax, Tax Profs | Permalink | Comments (1)

Tamanaha, Estreicher Respond to Morriss' Ten Reasons To Be Cheerful About The Future of Legal Education

Brian Tamanaha (Washington University) and Samuel Estreicher (NYU) respond to Texas A&M Dean Andy Morriss' Ten Reasons To Be Cheerful About The Future Of Legal Education

Brian Tamanaha (Washington University), Reasons to Be Gloomy About Legal Education:

I agree with much in Dean Andrew Morriss’ Liberty Forum Essay. And I endorse his hope that, in the future, legal academia will have greater differentiation. Yet my take on legal education’s prospects is much gloomier. Dean Morriss writes mostly about what should occur going forward, whereas I am watching what is happening right now. What I see gives me little reason for cheer.

The greatest force for reform in legal education is the stunning decline in law-school applicants, falling to lows not seen in decades. The good news, as Morriss says, is that law schools compete for students through heavy discounting, in the form of higher scholarships deeper into the class. A dozen or so law schools have announced rollbacks in tuition. These price reductions should bring debt levels down for many future graduates, as long as pricing competition continues.

The other good news is that the decline in enrollment promises to reduce the oversupply of law graduates that has flooded the market in the past decade. The percentage of graduates who land full-time jobs as lawyers—about 55 percent nationwide for the last three graduating classes—should rise significantly in coming years.

That is the silver lining. Now let us look at the dark clouds.

  • Tuition at many law schools continues to rise.
  • Debt levels for many law graduates remain extraordinarily high.
  • Many are admitting students who should not be in law school.
  • Bar pass rates will continue to decline in coming years.

These are very serious problems, particularly the collapse in admissions standards. That is why I do not share Dean Morriss’ cheerful take on the future of legal education. He is aware of these issues, of course, and his more positive view is premised on looking beyond when the current crisis shakes out. Even if we stretch the time period out a full decade, however, I don’t see the future he projects.

At least three formidable obstacles stand in the way: legal educators, the American Bar Association’s accreditation standards, and parent universities.

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April 20, 2015 in Legal Education | Permalink | Comments (2)

Undisclosed: The State v. Adnan Syed

UndisclosedKudos to Colin Miller, editor of our EvidenceProf Blog, for following up on his wildly successful series of posts on the Serial Podcast about the prosecution of Adnan Syed with Undisclosed, a series of podcasts on the case (blogged here and here):

The Undisclosed Podcast is a listening experience that reframes, enhances or otherwise shifts everything you've come to know about the State of Maryland's case against Adnan Syed, especially as you've come to know it through listening to Serial. In order to do that, we intend to revisit the case from the beginning, looking at all the available evidence. Not only will we look at the evidence that was presented in Serial, but we will also provide new evidence that we've uncovered in our investigation. We have combed through police and court records that the Serial team did not possess during the podcast, and done much, much more to get to the truth. Accordingly, we aspire to present the best possible version of the events as we believe those events to be. We will also present theories that we believe the evidence best construes. Perhaps most importantly, we will provide you with all of our evidence as part of that process.

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April 20, 2015 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 711

IRS Logo 2Charleston Post and Courier editorial, Lack of Transparency a Continuing Scandal:

Hillary Clinton’s disclosure that she used her own email system for official and private business while Secretary of State and has wiped clean its server, after delivering print-outs to the State Department that she and her staff selected, is one more reminder that “the most transparent administration” ever still maintains large walls of darkness around sensitive subjects.

The Justice Department recently bolstered that sad truth when it declined to bring charges of contempt of Congress against former Internal Revenue Service official Lois Lerner.

That means Ms. Lerner can’t be compelled to tell Congress and the public about her role and motives while on the public payroll in supervising an IRS witch-hunt of “Tea Party” and other conservative groups seeking tax-exempt status in the 2011-2012 election cycle. ...

We are left to wonder who at the IRS knew about the crackdown on conservative, but not liberal, groups. Were there higher ups who wanted to tilt the political playing field against conservative candidates?

A reported 298 conservative groups were targeted. U.S. District Court Judge Susan Dlott recently ruled, over the objection of the Justice Department, that the Internal Revenue Service must turn over a list of their names to litigants who want to bring a class-action suit against the government for violating their First and Fifth Amendment rights as well as pertinent federal law.

So the public yet should get some additional information on this scandal from an unwilling administration.

Just over six weeks ago the inspector general for the IRS reported that it was looking into criminal activity by the agency in falsely reporting to Congress that it could not recover Ms. Lerner’s emails because of computer failure and the lack of backup tapes. The IG reported that his office found the backup tapes with little trouble.

That report let a bit of light into the dark subject of the politicization of the revenue service, but the relentless back-checking by the IRS and the Justice Department, like the possibly illegal destruction of records by Mrs. Clinton, will make it hard to learn what happened before the next presidential election is over.

As for the president’s promise that his administration would be the most transparent in history, it is well to remember the advice given by Richard Nixon’s Attorney General John Mitchell on how to evaluate that administration:

“Watch what we do, not what we say.”

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April 20, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

TaxProf Blog Weekend Roundup

Sunday, April 19, 2015

Law Schools Are Like the Chillow

ChillowForbes, 3 Ways Law Schools Are Like the Chillow, by Ryan Craig:

Like everyone, I’ve bought many lousy products in my life. Products that disappoint, break or never work to begin with. But one that stands out is the Chillow, the “revolutionary cooling pad” that “transforms your pillow into a Chillow.” ...

Another product that’s not working very well is the law degree. Graduates of private law schools carry an average debt load of $125k. Yet 45% of law school graduates are unable to find jobs that require JD degrees; every year there are twice as many new JD recipients as open positions.

Prospective consumers have taken note. Successive years of double-digit declines have cut the number of law school applicants nearly in half: from 100,000 in 2004 to just over 55,000 last year. The good news, according to the Law School Admission Council: “the rate of decline is slowing” (which tends to happen when the base gets lower).

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April 19, 2015 in Legal Education | Permalink | Comments (2)

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 #1 paper and a new paper debuting on the list at #5:

  1. [312 Downloads]  Cancellation of Debt and Related Transactions, by Douglas A. Kahn (Michigan) & Jeffrey H. Kahn (Florida State)
  2. [258 Downloads]  Abusive Tax Avoidance and Institutional Corruption: The Responsibilities of Tax Professionals, by Gillian Brock (Harvard) & Hamish Russell (Toronto)
  3. [255 Downloads]  The U.S. Foreign Account Tax Compliance Act: American Legal Imperialism?, by Bruce W. Bean (Michigan State) & Abbey Wright Farnsworth
  4. [236 Downloads]  Recent Developments in Federal Income Taxation: The Year 2014, by Martin J. McMahon Jr. (Florida), Bruce A. McGovern (South Texas) & Ira B. Shepard (Houston)
  5. [192 Downloads]  Can Sharing Be Taxed?, by Shu-Yi Oei (Tulane) & Diane M. Ring (Boston College)

April 19, 2015 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

The Bar Exam Is Unfair And Undemocratic

NewsweekNewsweek:  The Bar Exam Is Unfair and Undemocratic, by Allen Mendenhall:

The bar exam was designed and continues to operate as a mechanism for excluding the lower classes from participation in the legal services market. Elizabeth Olson of The New York Times reports that the bar exam as a professional standard “is facing a new round of scrutiny—not just from the test takers but from law school deans and some state legal establishments.”

This is a welcome development.

The dean of the University of San Diego School of Law, Stephen C. Ferruolo, complained to the Times that the bar exam “is an unpredictable and unacceptable impediment for accessibility to the legal profession.” He is right: The bar exam is a barrier to entry, a form of occupational licensure that restricts access to a particular vocation and reduces market competition. ...

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April 19, 2015 in Legal Education | Permalink | Comments (10)

The IRS Scandal, Day 710

IRS Logo 2Breitbart, IRS: Mistakes Were Made:

Judicial Watch has just released a new batch of documents forced out of the IRS that show the Obama administration’s scandalous misuse of the IRS to target Tea Party and other conservatives goes far deeper than realized.

Included in the new batch of documents is a February 2012 email from Lois Lerner, who was then head of the IRS’ Exempt Organizations Branch, asking that a special program be set up to “put together some training points to help [IRS staffers] understand the potential pitfalls” of revealing too much information to Congress. Amid the hundreds of released pages, Judicial Watch also found a remarkable Lerner email from 2013 in which she says she is willing to take the blame for not having provided sufficient direction to her underlings on how best to investigate the targeted groups, and then concedes that she “understands why the IRS criteria” leading to targeting of Tea Party groups and other opponents of President Obama “might raise questions.”

In May 2013, the Treasury Inspector General for Tax Administration (TIGTA) released an audit revealing the IRS had used “inappropriate criteria” to identify potential political cases. “Early in Calendar Year 2010,” TIGTA wrote, “the IRS began using inappropriate criteria to identify organizations applying for tax-exempt status to (e.g., lists of past and future donors).” The illegal IRS reviews continued for more than 18 months and, TIGTA reported, “delayed processing of targeted groups’ applications” preparing for the 2012 presidential election.”

Not so coincidentally, during this period of time, Lerner emailed former Director of the Office of Rulings and Agreements Holly Paz, attempting to limit information provided by the IRS to Congress about non-profit classifications. ...

Should Mitch McConnell lead Republicans and Democrats in requiring the appointment of a special counsel for Lynch (or, preferably, a better nominee) to get a vote on the floor of the U.S. Senate? Concerned citizens should let McConnell and other Senate representatives know what they think. McConnell’s office can be reached at 202-224-3121.

In the meantime, Judicial Watch will keep on doing what Justice and Congress won’t. There is more to come. The watchdog currently has thousands more internal IRS documents under review, several other lawsuits and more leads that are keeping the organization working at full capacity. The fight for transparency and accountability is too important to let up now.

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April 19, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, April 18, 2015

The Ugly Truth About What's Going Wrong In American Law Schools

UglyBloomberg, The Ugly Truth About What's Going Wrong in American Law Schools: With Test Scores and Bar-Passage Rates Falling, Academics Grope for Answers:

Are law students getting dumber, foreshadowing a future dip in the talents available to legal clients nationwide? Or are aspiring attorneys getting a bad rap?

The National Conference of Bar Examiners (NCBE), the nonprofit that creates the multiple-choice portion of the test used by many states, goes with the diminished-intellect theory. "The group that sat [for bar exams] in July 2014 was less able than the group that sat in July 2013," NCBE President Erica Moeser said in a blunt memo to law deans last October.

"That's just baloney," Brooklyn Law School's Dean Nick Allard tells me. An innovative leader scrambling to keep his venerable institution afloat in a shrinking legal job market, Allard alleges darkly that unnamed pooh-bahs are fixing the system to exclude his scrappy students. "It's a jaw-dropping story," he says. "The NCBE is a powerful testing organization with a web of financial interests that has an outsize role in determining the future careers of law school graduates." Tens of thousands of law school graduates, he adds, "are ripped off by the bar exam scam twice a year."

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April 18, 2015 in Legal Education | Permalink | Comments (3)

IRS Budget Cuts: Tax Administration v. Tax Handouts

Chris Edwards (Cato Institute), IRS Budget Cuts and Tax Filing:

For taxpayers needing IRS help, this year’s filing season could be a nightmare. The Washington Post today reports on the long lines at IRS offices. The newspaper suggests that five years of Republican budget cuts are to blame, even though Democrats control the White House and, until recently, the Senate. But, whoever is at fault, the IRS commissioner is correct that his agency’s service is “abysmal.”

Let’s take a closer look at those alleged budget cuts. Using data from the OMB budget database, I split total IRS outlays into two activities: administration and handouts. Administration includes tax return processing, taxpayer help, enforcement, and other bureaucratic functions. Handouts are mainly refundable tax credits, particularly the earned income tax credit, child credit, and Obamacare exchange subsidies, which began in 2014.

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April 18, 2015 in IRS News, Tax | Permalink | Comments (3)

Burk: Much Heat, Some Light In Resurgent Law School Eschatology Debate

Bernie Burk (North Carolina), Much Heat, Some Light in Resurgent Law-School Eschatology Debate:

There has been a flareup in the debate over the purpose and value of law school.  The new discussion has been prompted by a series of posts by Michael Simkovic on Brian Leiter’s Law School Reports in which he summarizes and elaborates on his work with Frank McIntyre in two recent articles, The Economic Value of a Law Degree and Timing Law School. (You can get Mike’s complete set of posts—there are, by my count, 14—on Leiter’s blog by starting here (posted March 19) and scrolling up.  Paul Caron has collected links to commentary on the commentary from both sides of the debate here, not all of which are subject to the objection I register below.) ...

[A]nyone with any intellectual honesty must appreciate the importance of Mike Simkovic’s recent contributions to the ongoing public discussion on the purpose and value of legal education.  His work ...  is by my lights the first serious, empirically grounded, methodologically thoughtful showing that things—at least some things for at least some people—may not be quite as bad as some of us have feared.

Predictably, extremists on both sides of this longstanding debate have popped up to demonize or deify Prof. Simkovic and his work, vilifying or vaunting his motives and methods in sweeping and categorical terms.  I have only one request of all of you—please stop.  Stop the toxic name-calling.  Stop erecting effigies of your adversaries’ graves so you can dance on them.  The subject is much too important to be obscured in petty rivalries.  You’re not enlightening anyone, and it’s way too early to claim a victory lap, let alone drag your enemy in circles at the back of your chariot for the next nine days.  (I, at least, perceive Mike as having managed to hold himself mostly above the fray thus far, with only an occasional descent into the snippy or snide when goaded a bit too much.  But that happens to all of us now and then—not least, I regret to say, your not altogether gentle scribe.  I hope we’ll both try harder from here on out.)

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April 18, 2015 in Legal Education | Permalink | Comments (3)

The IRS Scandal, Day 709

IRS Logo 2Letter From Charles Grassley (Chair, Senate Judiciary Committee) to Sally Yates (Acting Deputy Attorney General) and J. Russell George (Treasury Inspector General for Tax Administration) (Apr. 15, 2015):

I am writing in regard to the ongoing criminal investigation into the alleged misconduct by Internal Revenue Service personnel, including Ms. Lois Lerner, in connection with their handling of applications for tax-exempt status by certain conservative organizations. In May of 2013, Attorney General Holder announced that he had ordered the investigation. In January of 2014, the Wall Street Journal, citing unnamed law-enforcement officials, reported that the FBI did not at that time plan to file any criminal charges as a result of the investigation, but noted that the case was ongoing and would likely remain open for months.

On November 3, 2014, the Department of Justice filed a sworn declaration by Mr. Nelson D. Hermilla, an official in the Department’s Civil Rights Division, in a civil case in the U.S. District Court for the District of Columbia. In that declaration, Mr. Hermilla stated that the Justice Department “is currently conducting” the investigation of alleged IRS misconduct, further stating:

The investigation is being conducted by career attorneys in the Civil Rights Division and the Public Integrity Section of the Criminal Division, as well as agents from the Federal Bureau of Investigation and the Treasury Inspector General for Tax Administration.”

In order to evaluate the extent to which your organizations are actively investigating this issue, please provide written answers to the following questions by May 15, 2015:

1. Since January of 2014, who has been assigned to the investigation from each of the offices cited in Mr. Hermilla’s declaration?

2. When were they assigned, and by whom?

3. How many hours has each attorney or agent identified above worked on the investigation since being assigned to it? How many hours since January of 2014?

4. Prior to being assigned to this investigation, had any of these assigned attorneys or agents previously had contact with any of the IRS employees or offices under investigation? If so, please provide a detailed explanation of the nature and extent of the prior contacts.

5. Has a litigation hold or other preservation effort been instituted to ensure that all potentially relevant parties preserve all possible evidence, including electronically stored information that could otherwise be damaged or erased absent such preservation efforts? If so, please provide a copy. If not, please explain why not.

If you have any questions about this request, feel free to contact Patrick Davis of my Committee staff at (202) 224-5225. Thank you for your attention to this important matter.

Forbes, IRS Targeting Investigation Is Probed By Senator Grassley, by Robert W. Wood:

Without hyperbole, Sen Grassley ask logical questions and is entitled to some answers:

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April 18, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, April 17, 2015

The Smartest People Are Opting Out of Law School

Following up on Tuesday's post, Organ Projects 2.6% Decline in Fall 2015 1L Enrollment, With 12.4% Decline in 165+ LSATs, 4.1% Increase in < 150 LSATs:  Bloomberg, The Smartest People Are Opting Out of Law School:

American law schools have a brain drain problem. Fewer people with high Law School Admission Test scores are applying to and enrolling in law school, and less-qualified students are filling their slots, new research shows.

As schools grapple with a persistent slump in young Americans’ interest in legal education, the programs seem to be compensating for their sudden unpopularity by taking in people who wouldn’t have made the cut five years ago. As of March 2015, about half as many students with scores of 165 and above on the LSAT have applied to law school as did in 2010, according to a new analysis of the latest numbers from the Law School Admission Council, which administers the test. LSAT scores range from 120 to 180. Applications from students with lower scores are falling, too, but not nearly as sharply, as the second chart below shows.

Bloomberg 1

The disenchantment with law school on the part of the people most likely to get in shows up in the classroom head count, too: Around 5,400 people with the highest scores will enroll in law school this year, down from 9,400 in 2010, according to Jerome Organ, the University of St. Thomas School of Law professor who parsed the numbers. 

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April 17, 2015 in Legal Education | Permalink | Comments (2)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

Catholic University Turns To Buyouts, Layoffs In Wake Of $10 Million Law School Revenue Shortfall

Catholic Logo (2015)Following up on my previous posts (links below): Washington Post, Catholic University Turns to Buyouts and Layoffs to Cut Spending:

Catholic University, a school with direct ties to the Vatican, is trimming staff through layoffs and buyouts because of financial pressures. It is the third private university in the nation’s capital to disclose layoffs in recent weeks.

Thirty-seven positions were cut from a full-time staff of about 1,300, a Catholic spokesman confirmed Thursday. About two-thirds of those affected took voluntary buyouts, and the rest were laid off.

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April 17, 2015 in Legal Education | Permalink | Comments (0)

Pepperdine Law Review Symposium Today On International Arbitration And The Courts

Brochure 2I am sitting in on a wonderful Pepperdine Law Review symposium on International Arbitration and the Courts, organized by my friends and colleagues Trey Childress and Jack Coe. There is an all-star cast of speakers, including George Bermann (Columbia), Andrea Bjorklund (McGill), Christopher Drahoal (Kansas), Alan Rau (Texas), Jan Schaefer (King & Spalding, Frankfurt), Maxi Scherer (Queen Mary University of London), Abby Cohen Smutny (White & Case, Washington, D.C.), and Jarrod Wong (McGeorge). You can view the live stream here.

April 17, 2015 in Conferences, Legal Education | Permalink | Comments (0)

NY Times: Welcome To Your First Year As A Lawyer. Your Salary Is $160,000.

NY Times Dealbook (2013)New York Times Deal Book, Welcome to Your First Year as a Lawyer. Your Salary Is $160,000.:

Salaries for lawyers starting out at firms have remained flat, with an annual pay of $160,000 continuing to be the top of the market, according to a new survey from the National Association for Law Placement. [First-Year Associate Salaries at Large Law Firms Have Become Less Homogenous, Though $160,000 Continues to Define the Top of the Market].

Some 39 percent of the largest firms — those with 700 lawyers or more — reported paying that amount in the association’s 2015 law associates’ salary survey. This was up from last year, when only 27 percent of the big firms reported paying their new legal hires at the uppermost level. But the percentage was still below 2009, when nearly two-thirds of the first-year salaries were at the top point of $160,000. [Click on chart to enlarge.]

NALP

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April 17, 2015 in Legal Education | Permalink | Comments (4)

David Han And Greg McNeal Receive Pepperdine Faculty Scholarship Award

Congratulations to my friends and colleagues David Han and Greg McNeal, recipients of Pepperdine Law School's 2015 Dean's Award For Excellence in Scholarship for their outstanding 2014 publications:

HanDavid Han:

Courts generally craft speech-tort jurisprudence as a binary proposition. Any time state tort law and the First Amendment come into potential conflict, courts typically hold either that the First Amendment comes into play and the defendant is completely exempt from traditional tort liability, or that it does not come into play and the plaintiff is entitled to the full complement of tort remedies. In other words, courts generally adopt an unspoken assumption that in speech-tort cases, liability and full tort remedies necessarily go hand-in-hand.

This rigid approach, however, significantly limits courts’ ability to craft a nuanced balance between First Amendment and tort interests. In individual cases, it forces them to choose only one set of interests to be vindicated to the complete exclusion of the other, and on a jurisprudential level, it gives courts only the bluntest of instruments to tailor speech-tort doctrine to widely varying facts. Furthermore, the current approach exacerbates the distributional problem inherent to speech-tort cases: any time the First Amendment intervenes to completely invalidate a subset of common law tort liability, plaintiffs left without liability or remedy are effectively forced to subsidize the costs of free speech, the benefits of which are shared broadly by the public at large.

In this Article, I argue that courts should incorporate a greater degree of remedial flexibility into speech-tort doctrine. Rather than simply adhere to an all-or-nothing approach, courts should consider intermediate approaches in which the First Amendment applies not to vitiate a finding of tort liability but merely to limit or eliminate the damages to which plaintiffs are entitled. These approaches allow courts to shape the complex balance of speech and tort interests with a scalpel rather than a chain saw, both on a case-by-case basis and on the broader level of doctrinal design.

In recent years, this remedy-based approach to speech-tort jurisprudence has rarely been discussed by courts and commentators, while the shadow cast by the First Amendment over tort law has expanded well beyond the defamation context. This calcification of a rigid, binary approach to speech tort cases represents a significant lost opportunity for courts to design more sensible and equitable doctrines. By providing a detailed account of the benefits underlying the use of flexible remedies, evaluating potential critiques to such an approach, and laying out concrete examples of what a remedy-based regime might look like in practice, this Article seeks to rekindle judicial, legislative, and academic interest in adopting such approaches within speech-tort doctrine.

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April 17, 2015 in Legal Education | Permalink | Comments (0)

House Votes To Repeal Estate Tax, Preserve Step-Up In Basis At Death

Estate Tax LogoFollowing up on Monday's post, the House voted 240-179 yesterday to repeal the estate tax and preserve step-up in basis at death:

April 17, 2015 in Congressional News, Tax | Permalink | Comments (8)

Loyola-L.A. Law School Shrinks Enrollment By 20%, Taps $20 Million From University Endowment For Student Scholarships

Loyola-L.A. Logo (2013)Los Angeles Loyolan, LMU Approves Special Payout for Loyola Law:

Law school enrollment has seen a dramatic decline in the last five years. Since hitting its peak of 52,488 in 2010, enrollment at U.S. law schools has steadily fallen, plummeting to 37,924 this year, according to the ABA. Law schools around the country have adopted various strategies in order to deal with this 27.7 percent decrease.

Loyola Law School (LLS) has seized this opportunity to restructure and intentionally get smaller. LMU has also approved an approximately $20 million special payout from the University’s endowment towards student scholarships at the law school. ...

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April 17, 2015 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 708

IRS Logo 2Wall Street Journal editorial, How Lois Lerner Got a Pass: The Prosecutor Absolved the IRS Witness on His Last Day on the Job:

If Americans know anything about the IRS it’s that it accepts no excuses, and so they trudged wearily on Wednesday to pay their taxes. That’s in notable contrast to the free passes that keep flowing to the tax agency’s most famous former employee, Lois Lerner.

The Obama Administration’s latest gift to the former IRS tax-exempt chief came recently when U.S. Attorney for the District of Columbia Ron Machen informed the House of Representatives that he would not file charges on its formal contempt citation against Ms. Lerner. This absolution, which shields Ms. Lerner from a grand jury probe, came on Mr. Machen’s final day on the job.

To review: Ms. Lerner was summoned to the House on May 22, 2013, to answer questions about her role in the IRS’s politically biased review of Tea Party nonprofit group applications for tax-exempt status.

She began her testimony with a statement recounting her career, reprising the scandal and proclaiming her innocence. She ended by saying: “I have not done anything wrong. I have not broken any laws, I have not violated any IRS rules or regulations, and I have not provided false information to this or any other congressional committee.” Only after she offered this long defense did she claim her right not to incriminate herself by citing the Fifth Amendment, refusing to answer questions.

House lawyers determined that, in making that statement, Ms. Lerner had forfeited her right to remain silent. The House on May 7, 2014 held her in contempt of Congress and sent the citation to Mr. Machen.

The law clearly explains that the U.S. Attorney’s only “duty” “shall be” to “bring the matter before the grand jury for its action.” Mr. Machen instead sat on the contempt citation for 11 months, and on March 31 sent Speaker John Boehner a letter explaining he’d unilaterally decided not to investigate Ms. Lerner.

According to Mr. Machen’s rationale, Ms. Lerner’s statement made only “general claims of innocence” that did not forfeit her Fifth Amendment rights to refuse to answer questions. To reach this conclusion, Mr. Machen had to willfully ignore that Ms. Lerner, in her statement, rebutted specific accusations against her.

“[M]embers of this committee have accused me of providing false information when I responded to questions about the IRS processing of applications for tax exemption,” she said, before claiming she had never done so. Those accusations had been detailed to her in a letter from former House Oversight Committee Chairman Darrel Issa, eight days before she testified.

Mr. Machen also had to ignore that Ms. Lerner had prior to her House appearance voluntarily met for an interview with Justice prosecutors. As the Heritage Foundation’s Hans von Spakovsky has noted, the D.C. Circuit Court of Appeals in its 1969 Ellis v. U.S. decision found that “once a witness has voluntarily spoken out, we do not see how his protected interest is jeopardized by testifying in a subsequent proceeding, provided he is not required to disclose matters of substance which are unknown to the Government.”

Since Ms. Lerner had already disclosed to the “government” (prosecutors), she lost her privilege to clam up before Congress. And we’d note that after her House stonewall, she again chose to speak in an interview with the Politico website. Ms. Lerner wants the right not to answer questions except when it suits her public-relations purposes.

In any event, the job of making these legal calls belonged to a grand jury—not Mr. Machen. Then again, this is the prosecutor who in an exit interview with the National Law Journal about his tenure touted his allegiance to Attorney General Eric Holder, describing him as a “tremendous mentor and a tremendous friend.”

After Mr. Machen’s performance in shielding Ms. Lerner from the consequences of her actions, Mr. Holder would no doubt return the compliment. The handling of the IRS scandal is a blot on both of their careers.

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April 17, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Thursday, April 16, 2015

Omri Marian Leaves Florida For UC-Irvine

Marian (2015)Omri Marian, a rising tax scholar at Florida, has accepted a lateral offer from UC-Irvine. Omri spent three years as a tax associate at Sullivan & Cromwell and joined the Florida tax faculty in 2012. His recent tax scholarship includes (in addition to reviews and op-eds):

Omri joins Sarah Lawsky in giving UC-Irvine a powerhouse tax faculty and strengthening my not entirely disinterested view that Southern California boasts the strongest collection of tax scholars of any region in the country, which includes, among others:  UCLA (Steve Bank, Jason Oh, Kirk Stark, Eric Zolt), USC (Tom Griffith, Ed Kleinbard, Ed McCaffery), San Diego (Howard Abrams, Jordan Barry, Victor Fleischer, Miranda Perry Fleischer, Bert Lazerow), and Loyola-L.A. (Ellen Aprill, Ted Seto, Katie Pratt), not to mention (ahem) the tax faculty at Pepperdine.

April 16, 2015 in Scholarship, Tax, Tax Prof Moves | Permalink | Comments (3)

NY Times Op-Ed: The Declining Support For Redistribution

New York Times op-ed:  Has Obamacare Turned Voters Against Sharing the Wealth?, by Thomas B. Edsall:

With the advent of the Affordable Care Act, the share of Americans convinced that health care is a right shrank from a majority to a minority.

This shift in public opinion is a major victory for the Republican Party. It is part of a larger trend: a steady decline in support for redistributive government policies. Emmanuel Saez, an economics professor at Berkeley and one of the nation’s premier experts on inequality, is a co-author of a study [How Elastic Are Preferences For Redistribution? Evidence From Randomized Survey Experiements] that confirms this trend, which has been developing over the last four decades. A separate study, The Structure of Inequality and Americans’ Attitudes Toward Redistribution, found that as inequality increases, so does ideological conservatism in the electorate.

The erosion of the belief in health care as a government-protected right is perhaps the most dramatic reflection of these trends. In 2006, by a margin of more than two to one, 69-28, those surveyed by Gallup said that the federal government should guarantee health care coverage for all citizens of the United States. By late 2014, however, Gallup found that this percentage had fallen 24 points to 45 percent, while the percentage of respondents who said health care is not a federal responsibility nearly doubled to 52 percent. ...

The conservative shift in public attitudes on health care and on issues of redistribution and inequality pose a significant threat to the larger liberal agenda.

The 2013 paper published in Public Opinion Quarterly that I mentioned at the beginning of this article, The Structure of Inequality and Americans’ Attitudes Toward Redistribution, suggests that Democratic programs providing tax-financed benefits to the poor are facing growing hostility.

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April 16, 2015 in Tax | Permalink | Comments (0)

Moody's: Rich Colleges and Universities Are Getting a Lot Richer

Moody'sWashington Post, Rich Colleges and Universities Are Getting a Lot Richer, Study Finds:

The 10 richest universities in America hold nearly a third of the total wealth, in cash and investments, amassed by about 500 public and private institutions. The 40 richest hold almost two-thirds of the total wealth.

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April 16, 2015 in Legal Education | Permalink | Comments (1)

NY Times Op-Ed: Shaming Those Who Skip Out on Taxes

New York Times op-ed:  Shaming Those Who Skip Out on Taxes, by Ricardo Perez-Truglia (Harvard) & Ugo Troiana (Michigan):

In 2006, according to an estimate by the United States Treasury Department, Americans underpaid their taxes by about $450 billion. For that year, that’s roughly equal to Pentagon spending, and more than the gross domestic products of Sweden and Switzerland.

A good chunk of the missing tax revenues comes from underreporting income, or tax evasion. The rest, roughly 25 percent — about $110 billion — comes from failure to pay taxes, or tax delinquency.

Some people are hard up and can’t afford to pay their taxes. But others simply choose not to pay. When traditional enforcement strategies, like charging above-market interest rates on the debt, don’t work, the government uses a number of tools to collect these taxes. For instance, some states, like Kentucky, can order employers to take a bigger tax bite from the wages of tax delinquents, as allowed by federal and state law.

But traditional collection methods don’t always work. In a recent study [Tax Debt Enforcement: Theory and Evidence from a Field Experiment in the United States], we used another strategy that got results: publicly shaming tax delinquents. It should be a key part of government efforts to increase the collection of tax debts, and thanks to the Internet and social media, the government has the means to make it even more effective.

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April 16, 2015 in Tax | Permalink | Comments (0)

'Culture of Cheating' Prevalent at Stanford, Other Elite Colleges

LogoLos Angeles Times, Colleges Grapple With Cheating in the Digital Age:

Stanford University's honor code dates to 1921, written by students to help guide them through the minefield of plagiarism, forbidden collaboration, copying and other chicaneries that have tempted undergraduates since they first arrived on college campuses.

Exams aren't proctored, and students are expected to police themselves and speak up when they see others committing violations.

But there appears to have been a massive breakdown during the recent winter quarter, culminating in "an unusually high number of troubling allegations of academic dishonesty" reported to officials, according to a letter to faculty from Provost John Etchemendy.

"Among a smattering of concerns from a number of winter courses, one faculty member reported allegations that may involve as many as 20% of the students in one large, introductory course," Etchemendy said in the March 24 letter. ...

Although the Stanford allegations may have surprised some, for many others they cemented the belief that a culture of cheating pervades higher education. Harvard, Dartmouth, the Air Force Academy and other prominent institutions have recently grappled with allegations of large-scale cheating.

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April 16, 2015 in Legal Education | Permalink | Comments (4)

North Carolina Law Review Festschrift In Honor Of Bill Turnier

TurnierJohn Charles Borger (Dean, North Carolina), An Issue in Tribute to a Splendid Career William J. Turnier: UNC Law Colleague, 1973–2014, 93 N.C. L. Rev. 643 (2015):

It is not every senior faculty member whose fondest wish upon retirement is less a dinner hosted in his honor or a public celebration in the Rotunda of Van Hecke-Wettach, but rather an issue of the North Carolina Law Review devoted to tax scholarship. Yet it seems completely fitting that William J. Turnier, a member of the University of North Carolina law faculty for the past forty-one years, has acquiesced in the tribute that appears in these pages, a series of tax articles his scholarly colleagues have assembled in this issue of the Review to mark his departure from full-time academic life. ...

There is always some sadness in watching the departure from our halls of learning of someone who has built such a rich career and commanded such gratitude from more than two generations of students. Yet Bill Turnier’s impact on Carolina Law will remain, and by suggesting this special issue, designed in tribute to his chosen field, Bill has afforded us one last gift that will endure as long as readers strive to read, research, and understand law and its potential for ordering the commonweal.

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April 16, 2015 in Legal Education, Scholarship, Tax | Permalink | Comments (1)

Adler: How The IRS Repeatedly Rewrites Obamacare Tax Credit Provisions

The Volokh Conspiracy:  How the IRS Repeatedly Rewrites Obamacare Tax Credit Provisions, by Jonathan H. Adler (Case Western):

The plaintiffs in King v. Burwell argue that an IRS regulation unlawfully extends tax credit eligibility beyond what is expressly authorized under Section 1401 of the Patient Protection and Affordable Care Act (PPACA). It appears that this sort of administrative rewrite of the PPACA may be more the rule than the exception, as there are at least two other instances of the IRS rewriting the PPACA’s tax credit eligibility requirements. 

In a series of posts at “Notice & Comment,” the blog of the Yale Journal on Regulation, Professor Andy Grewal documents two additional cases in which the IRS has rewritten the PPACA’s tax credit eligibility requirements so as to expand eligibility beyond what Congress authorized.  Combined with other instances of the IRS and HHS disregarding the PPACA’s plain text, it appears the federal government has little regard for what the PPACA actually says. ...

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April 16, 2015 in Tax | Permalink | Comments (5)

Georgetown Launches 'Low Bono' Law Firm With DLA Piper, Arent Fox

The Mob Museum: The Treasury Department's Special Intelligence Unit

Mob MuseumThe Mob Museum Presents Follow The Money: The Unsung Intelligence Unit That Put Away Some Of The Most Notorious Mobsters:

Who put some of the most notorious mobsters behind bars? Many people don’t realize it was, in fact, the IRS. On Thursday, April 16 at 8 p.m., The Mob Museum, the National Museum of Organized Crime and Law Enforcement, presents its next installment in the Courtroom Conversations series, “Follow the Money: The Unsung Intelligence Unit That Brought Down the Mob.”

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April 16, 2015 in IRS News, Tax | Permalink | Comments (0)

The IRS Scandal, Day 707

IRS Logo 2Wall Street Journal, House Passes Package of Bills Aimed at Curbing IRS Abuses:

The House on Wednesday passed a package of bills aimed at preventing future abuses at the Internal Revenue Service, in the wake of a series of controversies at the agency.

The bills, which were largely noncontroversial, passed the House on voice votes, with support from some Democrats.

Despite the bipartisan agreement on Wednesday, the bills’ future in the Senate remains somewhat unclear, as there is ongoing partisan rancor over the IRS.

Republicans have been harshly critical of the IRS, particularly after an inspector general’s report in 2013 said agency officials had targeted dozens of tea party-type groups for intrusive scrutiny as they sought tax-exempt status, starting in 2010. That controversy in turn led to a series of other scandals, for example over how and why the agency had mishandled some confidential taxpayer information. ...

Democrats have acknowledged problems with some of the agency’s processes. But they have generally blamed bureaucratic incompetence, saying the agency wasn't motivated by political bias. ...

The bills passed on Wednesday were mostly narrow in focus. One would streamline the application process for nonprofit social-welfare groups seeking to become tax-exempt, effectively eliminating the IRS’s ability to hold up their applications indefinitely.

Another would make it a firing offense for an IRS official to target taxpayers for their political beliefs. Still another would clarify that gift taxes don’t apply to donations to social-welfare groups organized under section 501(c)(4). 

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April 16, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, April 15, 2015

Shay Presents Designing a U.S. Minimum Tax on Foreign Business Income Today at Penn

Shay (2014)Stephen Shay (Harvard) presents Designing a U.S. Minimum Tax on Foreign Business Income (with Cliff Fleming (BYU) & Robert Peroni (Texas)) at Pennsylvania today as part of its Tax Law and Policy Workshop Series hosted by Chris William Sanchirico and Reed Shuldiner:

This paper continues an exploration of second best international tax reforms, in this case, how a U.S. minimum tax on foreign income earned by a controlled foreign corporation should be designed to protect the U.S. against erosion of its corporate income tax base and combat tax competition by low-tax intermediary countries. A minimum tax should be an interim tax that preserves the residual U.S. tax on foreign income. Such a tax would more effectively limit incentives to seek low-taxed foreign income while ameliorating pressure to retain excess earnings abroad. Corresponding changes should be made to the U.S. corporate residence definition, to the residence taxation of U.S. portfolio investors in foreign corporations and to the source taxation of foreign MNCs to reduce tax advantages under current law for investments in foreign corporations. These changes would reduce tax advantages for foreign parent corporate groups and incentives for U.S. corporations to expatriate as a consequence of increased U.S. taxation of foreign income.

April 15, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Chodorow: What It Would Mean For The IRS If Scientists Defeat Mortality

WilliamsSlate, Death and Taxes: What It Would Mean for the IRS If Scientists Defeat Mortality, by Adam Chodorow (Arizona State):

It has long been said that the only things certain in life are death and taxes. If you still haven’t filed your taxes, or if you were hit with a big bill this year, the former might seem more appealing than the latter right now. However, the aphorism is death and taxes, not death or taxes. Even kicking the bucket cannot provide an escape.

But what if death isn’t so certain? How would that affect taxes? In a 2012 law review article titled “Death and Taxes and Zombies,” I considered the important question of whether those who die and come back as zombies should be considered dead for estate tax purposes. The answer to this question is important both for the government, which will need significant revenues to protect the living, and for individual taxpayers, who may be tempted to escape the estate tax by becoming zombies.

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April 15, 2015 in IRS News | Permalink | Comments (0)

IRS in Space: How Will We Tax a Mars Mission?

ESASpace.com, IRS in Space: How Will We Tax a Mars Mission?:

Paying taxes is an inescapable reality — even in space.

Taxes are going to play a big role in a Mars mission, both in getting there and upon arrival, Adam Chodorow, a law professor at Arizona State University in Tempe, said April 9 at an event hosted by Future Tense, a partnership of Slate, the nonprofit New America Foundation and Arizona State University.

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April 15, 2015 in Tax | Permalink | Comments (1)

A Dozen University of Texas Law Profs Are Victims of Tax Identity Theft

Texas LawAustin American-Statesman, UT Law School Faculty Members Fall Victim to ID Theft, Tax Scam:

University of Texas officials are investigating whether a data breach may have led to the identity theft of at least a dozen Law School faculty members who appear to be victims of a tax scam.

The identity theft was discovered when faculty members attempted to file their federal tax returns only to have the Internal Revenue Service reject the submissions, stating that their returns had already been filed, Law School spokesman Christopher Roberts said Tuesday.

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April 15, 2015 in Legal Education | Permalink | Comments (1)

NY Times: Would You Let The IRS Prepare Your Taxes?

Turbo Tax (2015)New York Times, Would You Let the I.R.S. Prepare Your Taxes?:

Around this time every year, Joseph Bankman, a professor of tax law at Stanford Law School and a longtime advocate of using technology to simplify tax filing, gets on the phone with reporters to explain what is wrong with how we do our taxes in the United States. Every year he says pretty much the same thing: No other industrialized country asks its citizens to jump through as many hoops to calculate their taxes as ours.

It isn’t just lawmakers or the hapless-seeming Internal Revenue Service that is perpetuating the annoyance of tax time, he adds. Instead it is the private sector — specifically, the software company Intuit, which makes TurboTax, the most popular tax program in the country.

For more than a decade, Mr. Bankman and a small group of tax experts have called on the government to create a tax preparation method that they say would vastly reduce the time and cost of tax-filing for most people. Intuit has been a primary obstacle to the effort.

The reform plan would work like this: Today, employers, banks, brokerage firms and pretty much every other financial organization in the country send the federal government detailed records about our economic activity every year. These organizations also send you, the taxpayer, a similar set of documents, which are forms with names like W2 and 1098. After you file your taxes, the government matches its two sets of documents to make sure you have filed correctly.

To Mr. Bankman, this double documentation doesn’t make much sense. If the government is already collecting financial data from employers and banks, why can’t the I.R.S. use that information to precalculate our tax returns for us? At the very least, why can’t tax software just connect to the government’s database to download all the information that the government has collected, saving us all that record-keeping and data entry?

“Imagine if your vehicle registration fee was done the same way,” Mr. Bankman asked in a recent interview. “Imagine if the state said, ‘Go to your car, find your VIN number and then look at this table that has different tax rates to find out how much you owe.’ If they did, people would probably need to hire an expert for that too.”

The idea of the government filling our tax returns for us, known as “return-free filing,” has been met with much opposition from several groups, including conservatives suspicious of the I.R.S. And as the investigative news organization ProPublica reported in 2013 and 2014, some of the most intense opposition has come from Intuit, which has spent millions lobbying to oppose methods for the I.R.S. to create a tax-filing system that might free us from having to use software like TurboTax. ...

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April 15, 2015 in Tax | Permalink | Comments (3)

World Premiere of Loopholes, A Pain In The I.R.S.

Tonight is the world premiere of Loopholes, A Pain In The I.R.S. at the Hudson Mainstage Theatre in Hollywood, Calijfornia

Loopholes

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April 15, 2015 in Celebrity Tax Lore, Tax | Permalink | Comments (0)