TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Monday, April 25, 2016

TaxProf Blog Weekend Roundup

Sunday, April 24, 2016

Anderson:  Law Schools Should Deliver More 'Practical Education', Not 'Experiential Education'

Robert Anderson (Pepperdine), Clinical Legal Education Survey Results:

The law school world is currently enthralled with the idea of "experiential education." The push for experiential education comes from bar associations, accrediting agencies, and especially from lobbying groups of a certain segment of the law professoriat.

I am a big supporter of what I call "practical education" in law schools, which I consider to be education that will prepare law students to be effective early in their careers in their chosen areas of practice. My idea of "practical education" overlaps with, but is not the same as experiential education. A student can have an "experiential" bonanza in The Clinic for the Protection of Left-Handed Ferrets and emerge with no practical skills at all. Indeed, much of what passes for experiential education is not oriented toward imparting practical skills, because it focuses on narrow ideological areas of interest to faculty but not to students who need to get a real job when they graduate.

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

Today Is Tax Freedom Day — Earlier In MS, TN & LA, Later In CT, NJ & NY

Tax Foundation logoTax Foundation, Tax Freedom Day 2016 is April 24:

  • This year, Tax Freedom Day falls on April 24, or 114 days into the year (excluding Leap Day).
  • Americans will pay $3.3 trillion in federal taxes and $1.6 trillion in state and local taxes, for a total bill of almost $5.0 trillion, or 31 percent of the nation’s income.
  • Tax Freedom Day is one day earlier than last year, due to slightly lower federal tax collections as a proportion of the economy.
  • Americans will collectively spend more on taxes in 2016 than they will on food, clothing, and housing combined.
  • If you include annual federal borrowing, which represents future taxes owed, Tax Freedom Day would occur 16 days later, on May 10.
  • Tax Freedom Day is a significant date for taxpayers and lawmakers because it represents how long Americans as a whole have to work in order to pay the nation’s tax burden.

Tax Freedom Day

Center on Budget and Policy Priorities, Tax Foundation Figures Do Not Represent Typical Households’ Tax Burdens; Figures May Mislead Policymakers, Journalists, and the Public:

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April 24, 2016 in Tax, Think Tank Reports | 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 paper debuting on the list at #5:

  1. [746 Downloads]  Lexisnexis® Guide to FATCA Compliance: Chapter 1, by Willliam Byrnes (Texas A&M) & Robert J. Munro (Texas A&M)
  2. [309 Downloads]  Ownership of the Means of Production, by E. Glen Weyl (Chicago) & Anthony Lee Zhang (Stanford)
  3. [281 Downloads]  The Law of the Platform, by Orly Lobel (San Diego)
  4. [259 Downloads]  Taxing Wealth Seriously, by Edward J. McCaffery (USC)
  5. [170 Downloads]  The Panama Papers and Tax Morality, by Usman W. Chohan (University of New South Wales)

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

The Accreditation Battle Over Canada's First Christian Law School

Trinity WesternFollowing up on my previous posts (links below):  Richard Moon (University of Windsor), The Accreditation of Trinity Western University's Law Program:

There is a debate at the moment about whether the law societies (which regulate the legal profession in the various provinces) must accredit a law program to be offered by Trinity Western University [TWU], a private Evangelical Christian college. The Law Society of Upper Canada [LSUC], along with the law societies of British Columbia and Nova Scotia, refused to the accredit the proposed program because of the school’s discriminatory admissions policy and in particular the covenant that all students are required to sign, in which they agree, among other things, not to engage in sex outside of marriage and sex with a same-sex partner. The issue in the TWU accreditation case is whether the covenant is simply an internal matter (a rule that applies simply to the internal operations of a voluntary religious association) or whether it impacts outsiders to the religious community or the public interest, more generally. As I understand it, the law societies are not claiming that the members of a religious community need to be protected from oppressive or discriminatory internal rules. There are two ways in which it may be argued that the TWU program (and the covenant in particular) will have an impact on the public interest.

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April 24, 2016 in Legal Education, Scholarship | Permalink | Comments (1)

The IRS Scandal, Day 1081

IRS Logo 2Patheos:  President Obama Isn’t Interested in Improving the IRS and His Veto Threat Proves It, by Mark Meckler:

President Obama made it abundantly clear this week that he has no interest in improving the integrity of the IRS by promising to veto at least one of four Republican bills aimed at holding the tax giant to the highest standards.

Here is what the president is so opposed to:

  • Executive bonuses curbed until measurable improvements in taxpayer services are proven
  • Banning the hire of persons with tax debt or other tax-related delinquencies
  • Stopping the IRS from rehiring previous employees who were fired for misconduct
  • Curbing the use of fees to fund extra programs

These sensible components that could help revamp a severely broken and biased system are apparently contrary to the big government goals of this administration. The Office of Management issued a Statement of Administration Policy on Monday that outlined the objections to three of the bills they deem as “unnecessary.”

It seems as though the White House — the same one that promised to be the most transparent in history — is more interested in doing things behind closed doors and continue on targeting its political opposition through the IRS vehicle. President Obama continuously asks for sensible legislation from Republicans and when he gets it and sees that it undermines his agenda, he pulls out the veto threat. It’s not hard to see what he’s after and we must continue the fight to resist becoming his targets.

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April 24, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Saturday, April 23, 2016

This Week's Ten Most Popular TaxProf Blog Posts

Barton:  Syracuse's Hybrid Online J.D. Program Is Not The Reboot Legal Education Needs

RebootFollowing up on Thursday's post, Syracuse Law School Seeks Approval For Nation's Second Hybrid Online J.D. Program:  Bloomberg BNA:  Nothing Exciting Yet about the (Mostly) Online J.D. from Syracuse, by Ben Barton (Tennessee):

Everyone knows that hidebound law schools have been too slow to respond to changes in the market and technology. ... [M]aybe the program at Syracuse and a similar one at Mitchell Hamline Law School are good news? Is any change good change?

Keep the champagne corked for now. First and foremost, both programs cost the same as attending in person. And yet they will be radically cheaper for the law school to operate, especially once the first round of technical bugs are worked out. Law school’s most glaring weakness is its cost. Law school tuition has outpaced inflation since the 1980s, and has continued its staggering rise even since the market for lawyers and law school attendance have cratered since 2008. According to the non-profit advocacy Law School Transparency, there are fourteen different law schools where the total cost of attendance tops out at over $300,000! Syracuse’s tuition for 2016-17 is $46,460 and Mitchell Hamline’s is $40,570. It will likely be cheaper for students to live at home and work during law school, but until online law schools start passing on their savings to the students I will remain skeptical.

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

NY Times:  Sun Capital Ruling On Pension Fund Debt Could Shake Up Private Equity Industry

NY Times Dealbook (2013)Following up on my previous posts on the Sun Capital case (links below):  New York Times Dealbook:  Ruling on Pension Fund Debt Could Shake Up Private Equity Industry, by Libby Lewis:

It did not receive much notice, but a decision by a federal judge in Massachusetts has reverberated loudly through the private equity industry. Late last month, Judge Douglas P. Woodlock of the United States District Court in Massachusetts found that two private equity funds were jointly liable for the pension fund debt of one of the companies they acquired.

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April 23, 2016 in Tax | Permalink | Comments (0)

Simkovic: Law School Attendance, Happiness, And Success

GuidePaula Franzese (Seton Hall), A Short and Happy Guide to Being a Law Student (2014):

A Short & Happy Guide to Being a Law Student is a must-read whenever worry or doubt creep in. In this volume you will find essential wisdom for the study of law and life. Learn from the unprecedented ten-time recipient of the Professor of the Year award how to be your best in and out of class, how to prepare for exams, how to succeed on exams, how to put your best foot forward in a job interview, how to find teachers to inspire you, what to do in classes that leave you uninspired, how to cope with stress and how to create value in everything you do.

Michael Simkovic (Seton Hall), Book Encouraging Law Students to be Happy Is Latest Target for Scambloggers:

Paula’s well-intentioned book has rather bizarrely been attacked by scambloggers as “dehumanizing”, “vain”, “untrustworthy” and “insidious.” The scambloggers are not happy people, and reacted as if burned by Paula’s sunshine. They worry that Paula’s thesis implies that “their failure must be due to their unwillingness to think happy and thankful thoughts.”

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April 23, 2016 in Book Club, Legal Education | Permalink | Comments (26)

The IRS Scandal, Day 1080

IRS Logo 2Variety, Hollywood Conservative Organization Friends of Abe to Wind Down Current Structure:

Friends of Abe, the organization launched a decade ago as a fellowship for Hollywood conservatives, told members on Thursday that it would abandon its IRS 501(c)3 status, stop collecting sustaining membership dues and operating its website.

Instead, the organization will become a looser affiliation, although some of its founders denied that they are dissolving completely.

“The situation is we were always designed to be a fellowship and not an activist organization,” said writer-producer Lionel Chetwynd, one of the founders of the group. “But now is the time where everyone wants to do something. The community is aware of us. The town is aware of us. Every trade paper and news outlet is aware of us. We really don’t need to exist as a centrally focused private discreet organization. It is time to open the birdcage and fly.” ...

He said that discussions have been ongoing since last fall over the future of the organization, and costs have been a concern. Its profile has risen as a parade of nationally known GOP and conservative figures have addressed the group, including Cruz and Trump, as well as Supreme Court Justice Antonin Scalia and Paul Ryan. Its members have included Kelsey Grammer, Patricia Heaton and Jon Voight, and Gary Sinise was its chief founder.

The group, which does not endorse or fundraise for candidates, had a high-profile dispute in 2014 with the IRS as it sought to obtain 501(c)3 non profit status, as the IRS expressed concerns over the political nature of its activities. The organization also refused to give the agency access to the portion of its website that included a membership roster, which it protects. The IRS eventually granted the status.

But retaining that status comes with costs, along with the cost of maintaining its website and other administrative expenses, as well as lawyers and accountants. According to IRS disclosure forms, the group took in $284,985 in revenue in 2013, compared with $241,680 in expenses. Sinise stepped away from the group’s leadership several years ago to concentrate on his foundation, which supports military veterans.

Newsmax, Hollywood's Lone Conservative Group Closing Down

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April 23, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Friday, April 22, 2016

Now That There Aren’t As Many Law Students, Hiring Has Stabilized (NALP 2016)

Above the Law, Now That There Aren’t As Many Law Students, Hiring Has Stabilized (NALP 2016):

With pants singed from an ironing mishap and a wicked Boston hangover, I showed up at Executive Director Jim Leipold’s morning panel at the recent NALP conference on the state of the legal hiring market. I can therefore report that the legal hiring market has more or less stabilized. There aren’t more jobs, but fewer people are coming out of law schools so employment rates are up for those who graduate. 

In 2007, the last good year on Earth, 68 percent of law grads received long-term, full-time, bar passage required jobs. Last year, 62% of graduates received such positions. Granted, law school enrollments are near record lows, but still, the news is that the market has corrected itself. The employment rate is up. The real number of jobs obtained is down. These are the times we live in.

There was also some good news about the most important chart in legal education: the NALP bimodal salary distribution chart. Once again, it shows that most grads get jobs in the $45,000 – $65,000 range, with only a lucky few getting the Biglaw jobs that pay $160,000.

NALP DistributionCurve2014

This year, Leipold says that if you look really closely you’ll see a slight uptick in the amount of people making salaries in the “valley.” Those high-five-figures/low-six-figures jobs would be great for grads who can’t work in Biglaw but would still like to have a reasonable shot at loan repayment. ...

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April 22, 2016 in Legal Education | Permalink | Comments (1)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

Weekly Student Tax Note Roundup

The Slow Professor:  Resisting Higher Education's 'Corporatizing Culture Of Speed,' Or 'Self-Indulgent Tenured Faculty Privilege'?

SlowInside Higher Ed, 'The Slow Professor' (reviewing The Slow Professor: Challenging the Culture of Speed in the Academy (University of Toronto Press, Mar. 28, 2016), by Maggie Berg (Queen’s University) & Barbara K. Seeber (Brock University)) (interview):

New book argues that professors should actively resist the "culture of speed" in academe.

In 2013, the jobs website CareerCast named university professor the No. 1 least stressful job, unleashing a torrent of criticism that only grew after Forbes picked up the ranking. Professors -- those with tenure and without -- said the study ignored the changing dynamics of the university, namely the increasingly administrative nature of academic work, the emerging student-as-customer model, unrealistic research expectations and 24-7 contact with colleagues and students via email. Non-tenure-track professors also pointed out that they in many cases lack all job security.

CareerCast evidently learned something from the controversy -- its 2016 least stressful jobs list specifies tenured professor, at No. 3 -- but old notions about what it is to be a professor die hard. And the CareerCast study is just one example. From the running errands to social and family events, someone always seems to be wondering what it’s like to have summers off and “just think” for a living.

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April 22, 2016 in Book Club, Legal Education | Permalink | Comments (2)

WSJ:  Goat Herd Helps Trump Lower Tax Bite

Wall Street Journal, Goat Herd Helps Trump Lower Tax Bite:

Donald Trump has found a solution that cuts both his grass and his tax bill: Goats.

The Republican presidential front-runner’s small goat herd, combined with hay farming and wood cutting, let him qualify for a New Jersey farmland tax break that saves him tens of thousands of dollars a year in property taxes on two golf courses, according to public records.

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April 22, 2016 in Political News, Tax | Permalink | Comments (1)

University of Washington (Seattle) To Open Separate Second Law School In Tacoma

UWThe News Tribune, Law School at UW Tacoma Would be Separate from Seattle Program:

University of Washington officials are moving forward with plans to create a law school at the UW Tacoma and want it to operate separately from the law school at the university’s Seattle campus, UW President Ana Mari Cauce said Wednesday. ...

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April 22, 2016 in Legal Education | Permalink | Comments (2)

Smith:  The PACT Act And The Constitutionality Of The Marketplace Fairness Act

Florida Tax Review  (2015)Eric Smith (Weber State), The PACT Act as Indicium of the Due Process Validity of the Marketplace Fairness Act, 19 Fla. Tax Rev. ___ (2016):

If passed into law, the Marketplace Fairness Act would impose a federal duty on out-of-state sellers to collect a state-defined and state-benefitting use tax. This unique exercise of federal power implicates due process. The PACT Act represents the only other instance in which Congress has similarly compelled state law compliance. Two circuit courts of appeals have found the PACT Act vulnerable on concerns of due process. This Article relies on the PACT Act analogue to simulate how the Marketplace Fairness Act would fare under similar scrutiny. To this end and in this uncommon context, two novel constitutional questions are considered: 1) with which sovereign, the federal government or the state, are minimum contacts measured; and 2) if measured with the state, is a single sale sufficient to meet due process thresholds?

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

The IRS Scandal, Day 1079

IRS Logo 2New York Times, I.R.S. Fights Back Against House Republicans’ Attacks:

For five years, congressional Republicans have taken out their anti-tax wrath on the Internal Revenue Service, cutting its budget by nearly $1 billion, reducing its staff by about 17,000, and even threatening to impeach its chief.

Now they say no one at the agency receives a bonus until customer service improves. And that measure, which the Republican-controlled House easily passed Thursday, was just one of six anti-I.R.S. measures that it approved this week, mostly by party-line votes, to mark the annual tax-filing deadline.

To supporters of the agency — and there are some — years of such attacks have yielded exactly what Republicans seemed to want: a depleted, defanged tax collector.

“I’m appalled, that’s all I can say,” said Lawrence B. Gibbs, a tax lawyer at Miller & Chevalier who joined the I.R.S. during the Nixon administration and was President Ronald Reagan’s choice for commissioner in 1986. “It’s fine to demonize the I.R.S. It has always been a target. Listen, that goes with the job.”

But, he added, given the nation’s challenges, “the one thing people ought to agree on is that we should have a revenue system that works and works well.”

“And if we’re going to create a disrespect for our tax revenue system,” he continued, “I look at it and say I just don’t think it’s in our country’s best interest.”

House Republicans even gave this week a name, “I.R.S. Week,” though the lines of attack began last week, and were many. In debate, multiple hearings (the I.R.S. commissioner, John Koskinen, testified four times over eight days), news conferences and commentary in the news media, the agency even got the blame for the hated tax code, which Congress writes and Republicans have promised for five years to rewrite and simplify.

“Right now, we have a tax code that no one can understand being enforced by an agency that no one trusts,” said Speaker Paul D. Ryan, Republican of Wisconsin, who was the chairman of the tax-writing Ways and Means Committee before taking the House’s top job last fall.

As certain as death and taxes, tax season political attacks on the I.R.S. go back decades. But in recent years, the intensity has grown and the agency’s funding in turn shrank more than any other time in memory. The campaign gained strength in 2013, when Republicans seized on management failures to allege that I.R.S. employees had singled out conservative groups for greater scrutiny and delays in reviewing their applications for tax-exempt status as “social welfare” organizations, though liberal-leaning groups were examined as well, investigations showed.

The assaults and especially the funding cuts have reached a point that the agency’s defenders are speaking out.

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April 22, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Thursday, April 21, 2016

Delaney Thomas Reviews Weeks McCormack's The Childcare Tax Squeeze

Jotwell (Tax) (2016)Kathleen DeLaney Thomas (North Carolina), It's Time to Revisit the Tax Treatment of Working Childcare Costs (reviewing Shannon Weeks McCormack (University of Washington), Over-Taxing the Working Family: Uncle Sam and the Childcare Squeeze, 114 Mich. L. Rev. 559 (2015)):

Childcare costs have soared in recent years while wages remain stagnant. To make matters worse, relief by provided by the tax code is extremely limited. Parents may be able to claim a tax credit for a portion of their childcare costs and may be able to divert limited funds to a pretax flexible spending account. But in many cases, these tax benefits capture only a minor portion of parents’ costs. It is no surprise, then, that with an election year upon us, a number of proposals to expand the current childcare tax credit have resurfaced in recent months. These proposals echo years of debate over whether the tax system discourages work by secondary earners and treats working parents unfairly vis-à-vis their non-parent counterparts.

But current proposals to modestly expand the childcare credit will make only a small dent in working parents’ childcare costs. Recognizing the inadequacy of such an approach, Shannon Weeks McCormack proposes a more fundamental reform in her forthcoming article, Over-Taxing the Working Family: Uncle Sam and the Childcare Squeeze. The childcare tax credit, she argues, should be replaced with an above-the-line deduction for childcare expenses that is not subject to phase-outs or dollar limitations. In essence, Weeks McCormack calls for according childcare expenses the same treatment as deductible trade or business expenses.

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

Gergen:  How To Tax Capital

Mark P. Gergen (UC-Berkeley), How to Tax Capital, 69 Tax L. Rev. ___ (2016):

This paper proposes a new system for taxing capital that can collect the same amount of revenue as the existing system with much lower administrative and compliance costs, and with somewhat lower distortionary impact. Its pillar is a flat annual tax assessed on the market value of publicly traded securities paid by an issuer. Wealth represented by a string of publicly traded securities is taxed once by giving an issuer a credit for amounts remitted with respect to publicly traded securities it owns. The securities tax will cover around 75 to 80 percent of income producing capital that is presently subject to the individual and corporate income taxes.

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

UC-Davis Spent $175,000 To Scrub Pepper Spray Incident From Google Search Results

UC DavidInside Higher Ed, How (Not) to Hide a Scandal:

Google “University of California, Davis.” What do you see? Who controls what you see?

Until last week, here’s what you wouldn’t see: images of a police officer, back in 2011, pepper spraying a group of student protesters. The students are assembled peacefully, sitting in a line on the ground, heads ducked. ...

Here’s the video of the incident, which racked up over a million views in the days after it was posted:


Once the video started circulating, the university tried to control the fallout. Over the last five years, it paid contractors at least $175,000 to scrub references to the controversy from the Internet.the video started circulating, the university tried to control the fallout. Over the last five years, it paid contractors at least $175,000 to scrub references to the controversy from the Internet.

But last week, the PR campaign backfired. On the afternoon of April 14, the top search result for “UC Davis” was the headline from The Sacramento Bee, the paper that broke the story through open-records requests: “UC Davis spent thousands to scrub pepper-spray references from Internet.”

Now, lawmakers and students are calling for Chancellor Linda Katehi’s resignation. They see the spending as an ethical breach: in the midst of budget cuts, how can the university use public funds to smooth over a scandal? ...

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

NY Times:  $20 Billion In Tax Credits For College Fails To Increase College Attendance

New York Times:  $20 Billion in Tax Credits Fails to Increase College Attendance, by Susan Dynarski:

Taxpayers will file for $20 billion in tax credits for college expenses they paid in 2015, but while those who get them will no doubt be happy, new evidence shows they have no effect on encouraging people to attend college.

The federal government provides over $30 billion annually in tax benefits for college. In addition to the two tax credits — the American Opportunity Tax Credit and the Lifetime Learning Credit — benefits include a deduction for interest paid on student loans, a recently defunct deduction for tuition expenses, and the 529 and Coverdell tax-advantaged savings accounts.

That is a lot of money. It’s about half of what the federal government spends on elementary and secondary education and two-thirds of what it spends on Pell Grants, which subsidize costs for low-income college students. 

The tax benefits were created to get more people into and through college. But researchers at Stanford and the University of California, Santa Cruz, have now shown that the largest tax benefit, the tax credits, have no effect on increasing education [The Returns to the Federal Tax Credits for Higher Education].

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April 21, 2016 in Tax | Permalink | Comments (2)

Wells:  International Tax Reform By Means Of Corporate Integration

Florida Tax Review  (2015)Bret Wells (Houston), International Tax Reform By Means of Corporate Integration, 19 Fla. Tax Rev. ___ (2016):

This Article focuses on a single organizing question, namely how should a dividend paid deduction regime be designed so that it achieves acceptable international tax outcomes. By focusing on the international tax implications attendant with a dividend paid deduction regime, the author is not attempting to minimize the broader benefits of achieving shareholder-corporate integration. The dividend paid deduction proposal, as to distributed earnings, would equate the tax treatment of debt and equity, and in so doing it would reduce distortions that current law creates with respect to debt and equity in the corporate context. Furthermore, recent economic works suggest that the incidence of the corporate income tax burden is partially shifted to labor and away from shareholders whereas a properly designed integration proposal puts the incidence of business taxation squarely on shareholders. Furthermore, shareholder-corporate integration for C corporations harmonizes the divergent tax treatment that currently exists between C corporations and pass-through entities. Thus, a corporate integration proposal provides a broad spectrum of potential benefits, and so not surprisingly significant scholarship has been dedicated towards how to best achieve shareholder-corporate integration. But, in today’s era, the overwhelming tax policy problem that must be solved rests on finding a solution to the systemic international tax challenges that face the country, and so that is where this Article will focus.

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

Islamic State's Income Drops 30 Percent On Lower Oil, Tax Revenue

ISIS FlagReuters, Islamic State's Income Drops 30 Percent on Lower Oil, Tax Revenue:

Islamic State's income and the population under its control have both fallen by about a third, a U.S.-based analysis firm said, describing the declining revenue as a threat to its long-term rule over its self-proclaimed caliphate.

Revenue for the ultra-hardline Sunni Muslim group, also known as ISIS or ISIL, fell to $56 million a month in March from around $80 million a month in the middle of last year, the analysis company IHS said.

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April 21, 2016 in Tax | Permalink | Comments (1)

Pepperdine Symposium:  The Impact Of King v. Burwell On Judicial Deference To IRS Determinations

Pepperdine Law ReviewSymposium, The Impact of King v. Burwell on Judicial Deference to IRS Determinations, 2015 Pepp. L. Rev. 1-81:

I previously blogged the online version of the symposium, published  just four months after the decision in King v. Burwell.  The Pepperdine Law Review has now released a hard copy of the symposium, pictured on the right.  This is the third major tax symposium produced by the Pepperdine Law Review over the past three years:

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April 21, 2016 in Conferences, Scholarship, Tax | Permalink | Comments (1)

NYLJ Special Report:  Law Schools

NYLJ Cover

New York Law Journal Special Report: Law Schools:

  • Jeremy Paul (Dean, Northeastern), Ask What the Bar Can Do for Law Schools:  "Bar leaders have looked to law schools to get better at producing so-called "practice-ready" graduates. But it is the profession's leaders who are best positioned to partner with law schools to solve the very problems legal employers so often identify."

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April 21, 2016 in Legal Education | Permalink | Comments (1)

House Democrats Introduce Bill To Raise Estate Tax Rate

Accounting Today, House Democrats Introduce Bill to Raise Estate Tax Rate:

Rep. Sander Levin, D-Mich., the ranking member of the tax-writing House Ways and Means Committee, and other House Democrats introduced legislation Wednesday to restore the estate tax and gift tax rate and exemption level to the same amounts as in 2009.

At the beginning of January 2013, Congress passed legislation raising the estate tax rate to 40 percent (up from 35 percent), with an exemption for estates below $5 million, but indexed for inflation. Under current law, estates valued at or below $5.45 million ($10.9 million for a couple) are exempt from owing any estate tax.

The proposed legislation, The Sensible Estate Tax Act of 2016, would return the exemption and tax rate to 2009 levels, lowering the estate tax exemption to $3.5 million ($7 million jointly) and increasing the maximum tax rate to 45 percent. The bill would also restore the rates for the gift tax and generation-skipping transfer tax. It would reinstate the $1 million lifetime gift exemption and retain the annual $14,000 gift tax exclusion and unlimited spousal portability. A summary of the bill is available here.

Estate Tax

April 21, 2016 in Congressional News, Tax | Permalink | Comments (3)

Law Revue Video Contest

Above the Law has announced the six finalists in its annual law revue video contest, with entries from students at George Washington, Georgetown, Northwestern, NYU, Texas, and Virginia law schools.  My favorite is from Texas:  Give Me My Grades Today:

For you Hamilton fans, NYU offers Trevor Effin’ Morrison:

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

The IRS Scandal, Day 1078

IRS Logo 2The Daily Signal, Jason Chaffetz Wants to Use ‘Atrophied’ Muscle of Impeachment Against IRS Commissioner:

The chairman of the House Oversight and Government Reform Committee wants Congress to impeach wayward government agents more often, and he’d like GOP leadership to start with Commissioner of Internal Revenue John Koskinen.

In an interview with The Daily Signal, Rep. Jason Chaffetz, R-Utah, likened impeachment “to a muscle that has atrophied over time,” and said he wants to “Get that muscle working again—this should be a common occurrence, this shouldn’t be once in a century.”

Chaffetz believes impeachment is within Congress’ Constitutional authority. “This was the safety valve,” he explained, “for somebody who’s not serving the best interest of the United States of America.”

Congress has only impeached

More recently Chaffetz has led the charge to impeach Koskinen, saying he obstructed the congressional investigation into the agency’s targeting of conservative groups. Chaffetz drew up impeachment articles for the taxman last October and directed his staff to hand deliver the papers to each member of Congress. Last year, the Treasury Department issued a statement backing Koskinen, saying that “Commissioner Koskinen is a man of the highest integrity with a steadfast commitment to public service during difficult times,” per the Associated Press.

But so far, House Speaker Paul Ryan, R-Wis., has hesitated to give Koskinen the boot. At a press conference last week, Ryan told reporters he’d rather wait until after the election to fire the top tax agent.

There’s always an election,” Chaffetz said, expressing frustration with Ryan’s decision to punt on the issue.

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April 21, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, April 20, 2016

Doran Presents The Puzzle Of Non-Qualified Retirement Pay Today At Penn

Doran (2015)Michael Doran (Virginia) presents The Puzzle of Non-Qualified Retirement Pay: Optimal Contracting, Managerial Power, and Taxes at Pennsylvania today as part of its Center for Tax Law and Policy Seminar Series hosted by Chris Sanchirico and Reed Shuldiner:

Pay arrangements for managers of public corporations typically include substantial amounts of compensation deferred through non-qualified retirement plans. As a departure from the familiar baseline of current payment for current services, this presents a longstanding puzzle. The corporate-governance literature offers two explanations for the practice. The “optimal-contracting account” argues that non-qualified retirement pay represents “inside debt” that aligns the interests of managers with the interests of the corporation’s unsecured general creditors. The “managerial-power account” argues that non-qualified retirement pay represents “stealth compensation” that facilitates managers’ extraction of rents from corporate assets. In this paper, I set out a different explanation based on tax considerations.

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April 20, 2016 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Clarke:  New Research On The Stubborn Persistence of Tax Expenditures

Conor Clarke (Ph.D. Candidate, Yale Law School), New Research on the Stubborn Persistence of Tax Expenditures, 150 Tax Notes 1462 (Mar. 21, 2016):

In this essay I examine new research on tax expenditures. By utilizing survey experiments, several new studies have explored when and why the public prefers spending programs organized as tax credits rather than direct expenditures, even when the substance and cost of the policies are the same. I argue that this 'framing effects' research can help explain why tax expenditures have continued to grow faster than government spending as a whole, and why tax expenditure budgets have failed to stop this growth.

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April 20, 2016 in Scholarship, Tax | Permalink | Comments (0)

Poverty, Foster Care, Rape, And Taxes

TaxesMelissa Chadburn, The Throwaways:

Strangely, it was for dreams like these—the simplest dreams of rest, of feeling, of safety—that I first began to look at taxes. Taxes are the tool that makes these dreams of ours possible. Shelter for everyone, food for everyone, taxes ensure public safety. And what about love? Love is given and received. Love is not a solitary act. Love requires people to commune with one another.

My previous associations with taxes were shame and guilt and trickery. Then I looked at my history with money and public funding in general. Some people have argued that we are a nation of self-interested people. People who only care about themselves. Their own well-being.

I disagree. I think we are better than that but have been assaulted by the overwhelming personification of Greed. In all the books we read, in all the films we watch, all the stuff in the news and social media, those who possess greed have the characteristic affect of the slow scrape of a Brillo pad against my heart. The most ferocious. The taking of things that do not belong (sex, money, power, children). The taking of too much is greed personified.

It’s our first lesson in pain.

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April 20, 2016 in Tax | Permalink | Comments (0)

Implicit Bias In Law Review Article Selection

Michael J. Higdon (Tennessee), Beyond the Metatheoretical: Implicit Bias in Law Review Article Selection, 51 Wake Forest L. Rev. ___ (2016):

Every year, law review editors around the country are forced to select which authors, out of the hundreds who annually submit articles, to extend offers of publication. For law review editors, these are stressful times given 1) the short time frame they have for reading and assessing this ever growing number of submissions and 2) the fear that a poor selection on their part could potentially embarrass both themselves and their law schools. Although legal scholars sometimes forget about article selection from the perspective of the hurried, stressed law review editor, everyone in the academy should be somewhat concerned about the current process. After all, numerous studies have shown that, when people are asked to make decisions quickly and under stressful conditions, their decision-making is more likely to be influenced by implicit bias.

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April 20, 2016 in Legal Education, Scholarship | Permalink | Comments (1)

Alm & Soled:  Did You Cheat On Your Taxes?

COnversation 2The Conversation: Did You Cheat on Your Taxes? Here’s Why Your Days May be Numbered, by James Alm (Tulane) & Jay Soled (Rutgers):

The so-called Panama Papers span thousands of pages, revealing that many of the world’s elite have been hiding their money in offshore accounts in an attempt to shield their income from taxes.

Their release – the biggest data leak in history – depicts a world of rampant tax noncompliance. However, it also reveals just how vulnerable all electronic data in the 21st century are to discovery.

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April 20, 2016 in Tax | Permalink | Comments (1)

Syracuse Law School Seeks Approval For Nation's Second Hybrid Online J.D. Program

Syracuse Logo (2016)Syracuse University Press Release, College of Law Partners With 2U for Juris Doctor Degree Program:

The College of Law and 2U today announced a partnership to develop a hybrid juris doctor (J.D.) degree program, pending New York State and American Bar Association approval.

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April 20, 2016 in Legal Education | Permalink | Comments (0)

NYU Hosts Book Discussion Today With Anne Alstott On A New Deal For Old Age

AlstottNYU Law Tax Blog, A New Deal for Old Age: Book Discussion with Anne Alstott (today at 12:30 p.m.):

Please join us for a presentation by Anne Alstott, the Jacquin D. Bierman Professor in Taxation at Yale Law School, of her recently published book, A New Deal for Old Age: Toward a Progressive Retirement (Harvard University Press, 2016). ...

As America’s haves and have-nots drift further apart, rising inequality has undermined one of the nation’s proudest social achievements: the Social Security retirement system. Unprecedented changes in longevity, marriage, and the workplace have made the experience of old age increasingly unequal. For educated Americans, the traditional retirement age of 65 now represents late middle age. These lucky ones typically do not face serious impediments to employment or health until their mid-70s or even later. By contrast, many poorly educated earners confront obstacles of early disability, limited job opportunities, and unemployment before they reach age 65.

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April 20, 2016 in Book Club, Scholarship, Tax | Permalink | Comments (0)

University Of Texas Law School Reallocates Tenured And Adjunct Faculty, Suspends Supreme Court Clinic

Texas Logo (2016)The Daily Texan, Students, Alumni Concerned Over Supreme Court Clinic Suspension:

The University’s Supreme Court Clinic has offered law students experience with drafting briefs and researching arguments used in front of the highest court of the country since fall 2006, but for the first time the clinic has been put on hiatus. ...

Current law students and Supreme Court Clinic alumni have said they’re concerned about the sudden semester-long closing, which they noticed a few weeks ago. Law school Dean Ward Farnsworth said a staffing problem had caused the clinic’s sudden suspension. ...

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April 20, 2016 in Legal Education | Permalink | Comments (1)

Joint Tax Committee Releases IRS Disclosures Of Tax Return Information, 2015

Joint Tax CommitteeThe Joint Committee on Taxation has released Disclosure Report for Public Inspection Pursuant to Internal Revenue Code Section 6103(p)(3)(C) for Calendar Year 2015 (JCX-32-16):

Section 6103(p)(3)(C) of the Internal Revenue Code provides that the Secretary of the Treasury shall, within 90 days after the close of each calendar year, furnish to the Joint Committee on Taxation for disclosure to the public a report which provides, with respect to each Federal agency and certain other entities, the number of: (1) requests for disclosure of returns and return information (as such terms are defined in section 6103(b)); (2) instances in which returns and return information were disclosed pursuant to such requests or otherwise; and (3) taxpayers whose returns, or return information with respect to whom, were disclosed pursuant to such requests. In addition, the report must describe the general purposes for which such requests were made

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April 20, 2016 in Gov't Reports, Tax | Permalink | Comments (0)

Clarke Reviews The Hidden Wealth of Nations

HiddenConor Clarke (Ph.D. Candidate, Yale Law School), What Are Tax Havens and Why Are They Bad, 94 Tex. L. Rev. ___ (2016) (reviewing Gabriel Zucman, The Hidden Wealth of Nations: The Scourge of Tax Havens (University of Chicago Press, 2015)):

This essay reviews Gabriel Zucman's The Hidden Wealth of Nations: The Scourge of Tax Havens. Zucman's important new book brings clarity to a confusing subject -- but occasionally does so at the expense of nuance. My review has three goals. First, I summarize and appraise Zucman's central findings, and re-estimate his revenue-loss totals for the United States using tax-rate assumptions that I believe are more realistic. Second, I position Zucman's findings against the backdrop of the wider literatures on tax havens and inequality, and attempt to answer the two questions in this essay's title. Third, I comment on Zucman's call for a global registry covering the ownership of financial securities. I argue that such a proposal must contend with the fact that there is no international legal consensus on what constitutes ownership.

Prior reviews of The Hidden Wealth of Nations:

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April 20, 2016 in Book Club, Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 1077

IRS Logo 2Townhall op-ed:  Dealing with the IRS Doesn’t Have to Be Hell, by Reps. Kevin McCarthy, Jason Smith, Rick Allen, Kristi Noem, David Rouzer & Glenn Grothman:

[H]ow do we plan to make the IRS more accountable? We have six bills we plan to pass next week.

The first will require the IRS to crack down on their employees who are delinquent on their own taxes. ...

Next, we will consider legislation that creates something that should already exist—a statutory rule blocking the IRS from rehiring employees who were already fired from the IRS for misconduct. ...

Following that, the House plans to pass a proposal that addresses the IRS’s shoddy customer service record in responding to requests for help in preparing tax forms. During some tax-filing seasons, the IRS only answers one in ten calls from taxpayers. This bill will ban IRS employees from getting bonus payments until the agency implements a plan to bring customer service performance levels up to what we expect of customer service in the private sector.

We also have a bill to prevent the IRS from keeping user fees they charge in a slush fund that is neither transparent nor accountable. ...

Lastly, we will be passing two bills that we expect to have wide bipartisan support: the first to stop any IRS funding from being used to target citizens for exercising their First Amendment rights, and the next to provide printed copies whenever requested of the official IRS instructions book on how to file taxes, ensuring those with limited or no Internet access still have everything they need to deal with April 15th.

In the week following Tax Day, House Republicans will send a clear message to the IRS: clean up your act, because this is only the beginning. Accountability isn’t an option in government; it’s a necessity. Only with a thoroughly reformed IRS and eventually a simplified and fair tax code can taxpayers again trust that the government is not only working efficiently, but is working for them.

Then, while we can’t promise that paying taxes will be a good experience, at the very least it won’t feel like being stuck in hell.

Office of Management and Budget, Statement of Administration Policy (Apr. 18, 2016):

The Administration opposes H.R. 1206, the No Hires for the Delinquent IRS Act; H.R. 4890, the IRS Bonuses Tied to Measurable Metrics Act; and H.R. 3724, the Ensuring Integrity in the IRS Workforce Act of 2015. These bills would impose unnecessary constraints on the Internal Revenue Service's (IRS) operations without improving the agency's ability to administer the tax code and serve taxpayers.

H.R. 1206 would prohibit the IRS from hiring any new employees until the Secretary of the Treasury certifies that no IRS employee has a seriously delinquent debt, or provides a report to the Congress that includes an explanation of why certification is not possible and what would be required to provide such a certification. The bill could result in the IRS being prohibited from hiring any new employees for any purpose -- a drastic and counterproductive step that would compromise tax administration and taxpayer services. The bill is also unworkable in operation, as "seriously delinquent" debts could be as low as $1 and tax liens are recorded on a case-by-case basis. This legislation is unnecessary, as strong laws and procedures already exist to ensure that IRS employees comply with their tax obligations. Publicly-available data show that IRS employees are among the most tax compliant groups in the Nation with a delinquency rate of less than 1 percent.

H.R. 4890 would ban performance awards to IRS employees until the Secretary of the Treasury develops and implements a comprehensive customer service strategy. This bill is unnecessary, as the IRS has already developed and has begun to execute a strategy to improve taxpayer services. The real constraint on the IRS's ability to serve taxpayers effectively is severe underfunding, including for taxpayer services. IRS funding is more than $900 million below its 2010 level, before adjusting for inflation. These budget cuts have impeded the IRS's ability to serve taxpayers, including inadequate responses to taxpayer calls and correspondence. Filing season statistics show that taxpayer service has improved this year as a result of a small funding increase provided last year, but more resources are needed to serve all taxpayers effectively and efficiently. Legislation constraining the IRS's ability to retain and recruit highly qualified employees is not needed and could be counterproductive to the Service's mission.

H.R. 3724 would prohibit the IRS from rehiring any employee who was involuntarily separated due to misconduct. The bill as written could force the immediate termination of employees who had been terminated and rehired many years ago, even if their performance since rehiring has been blemish-free. The bill's prohibition is also unnecessary because current IRS processes already ensure the agency does not rehire former employees who had significant conduct or performance problems during prior employment with the agency.

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

Tuesday, April 19, 2016

Student Activists Demand Free Tuition At Harvard Law School

Harvard Law School (2016)Harvard Crimson, Law School Activists Demand End to Tuition:

In the most recent wave of activism at the Law School, some students are calling on the school to eliminate tuition completely as part of their new campaign for financial justice.

Members of the group Reclaim Harvard Law published an open letter Sunday addressed to Law School Dean Martha L. Minow and members of the Harvard Corporation—the University’s highest governing body—demanding an end to tuition.

The demand is the cornerstone of “Fees Must Fall,” a campaign activists launched several weeks ago during the Law School’s admitted students weekend. The initiative marks a new focus on economic issues in their movement for better treatment of minorities at the Law School, after activists successfully advocated for the school to remove its controversial seal. ...

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April 19, 2016 in Legal Education | Permalink | Comments (20)

Goldin Presents Rethinking The Taxation Of Single Parents Today At Georgetown

GoldinJacob Goldin (Stanford) presents Beyond Head of Household: Rethinking the Taxation of Single Parents (with Zachary Liscow (Yale)) at Georgetown today as part of its Tax Law and Public Finance Workshop Series hosted by John Brooks and Itai Grinberg:

Under current law, unmarried taxpayers with children can take advantage of the head of household filing status (HHFS) to reduce their federal income taxes. We argue that the design of the filing status is largely obsolete, geared toward alleviating a “marriage penalty” in the tax code that is much less important than when the filing status was first established. At the same time, the growth in the fraction of Americans raising children outside of traditional two-parent households has dramatically raised the cost of the filing status to the fisc.

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April 19, 2016 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Alm Presents Whither The Tax Gap? Today At NYU

AlmJames Alm (Tulane) presents Whither the Tax Gap? (with Jay Soled (Rutgers)) at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Chris Sanchirico:

For decades, policy makers and politicians have railed against the “tax gap,” or the difference between what taxpayers are legally obligated to pay in taxes and what they actually pay in taxes. To close the gap, Congress has instituted numerous reforms, with varying degrees of success. Notwithstanding these efforts, the tax gap has largely remained intact, and, if anything, its size has gradually grown over the last several decades.

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April 19, 2016 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Coachella 2016:  Dropping Acid, Listening To Guns N’ Roses, Filing Tax Returns

Coachella2The Daily Beast, Coachella’s Hot New Act: Filing Taxes at the Last Minute:

Almost a dozen concertgoers rushed to Indio, California’s post office to snail-mail returns to the IRS between dropping acid and listening to Guns N’ Roses.

The Coachella music festival’s makeshift post office saw unexpected traffic this weekend, as festival-goers scrambled to file their tax returns last minute from the campground.

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April 19, 2016 in Tax | Permalink | Comments (0)

ABA Continues Inquiry Into BYU Law School’s Expulsion Of Ex-Mormon Students

BYUFollowing up on my previous post, Group Files Complaint With ABA Alleging Discrimination By BYU Law School Against LGTB, Ex-Mormon Students

Wall Street Journal, ABA Reviewing BYU Law’s Policy of Expelling Ex-Mormon Students:

Brigham Young University Law School is coming under fire for a potentially discriminatory practice of expelling ex-Mormons. An alumni group first brought concerns to the American Bar Association in January, and, according to the National Law Journal, the inquiry is still in the works.

National Law Journal, Inquiry Into BYU Law School’s Expulsion of Non-Mormons Proceeds:

Brad Levin, a law graduate and director of FreeBYU—the alumni group that filed a complaint with the ABA’s Section of Legal Education and Admissions to the Bar in January—was informed by letter on April 6 that the complaint survived an initial review by ABA administrators and has been referred to the organization’s accreditation committee for consideration.

FreeBYU’s complaint alleges that the university’s policy of expelling students who leave the Mormon faith runs afoul of ABA rules meant to protect against religious discrimination. Additionally, the group says the university honor code, which bans homosexual behavior, violates the accreditor’s protections of gay, lesbian and transgender students. ...

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April 19, 2016 in Legal Education | Permalink | Comments (1)

Law School Dean Completes Boston Marathon 8 Months Pregnant

WaynePress Release, Wayne Law Dean Completes Boston Marathon 8 Months Pregnant:

Jocelyn Benson, dean of Wayne State University Law School in Detroit, today became one of only a handful of women in history to complete the Boston Marathon in her eighth month of pregnancy.

Benson, 38, of Detroit completed the nation's most-prestigious marathon in 6 hours, 12 minutes, 32 seconds.

She planned to run Boston again, and she qualified at the San Diego Marathon in May with a time of 3 hours, 37 minutes.

"I found out in September that I was accepted to run in Boston, and I found out a month later that I was pregnant," Benson said. "Initially, I thought that eight months would be too far along for me to compete. But then I read a story about Amy Kiel, who had my same due date, was in her mid-thirties and had finished Boston in 2015. Her story inspired me to realize what seemed impossible was possible. So, I started training and, with the blessing of my doctor, flew to Boston to run."

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April 19, 2016 in Legal Education | Permalink | Comments (6)

Law School Rankings By Employment Outcomes:  California

Following up on Sunday's post, Law School Rankings By Employment Outcomes: New York And D.C./Maryland/Virginia:  Derek Muller (Pepperdine) blogs legal employment outcomes among California's 21 ABA-accredited law schools.  Stanford (92.3%, 8 law school funded jobs (LSF)), UCLA (91.3%, 34 LSF), and UC-Berkeley (91.0%, 11 LSF) are head and shoulders above the other California law schools in "total placement" (per U.S. News).

April 19, 2016 in Law School Rankings, Legal Education | Permalink | Comments (2)