TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Monday, June 13, 2016

Former Qwest CEO Nacchio Denied Tax Deduction For $45 Million Forfeiture Of Insider Trading Profits

Insider TradingNacchio v. United States, Nos. 2015-5114 & 2015-5115 (Fed. Cir. June 10, 2016):

This is a tax case arising out of a criminal conviction for insider trading. Joseph P. Nacchio and Anne M. Esker (“Nacchio”) filed this action in the Court of Federal Claims seeking an income tax credit of $17,974,832 for taxes paid on trading profits of $44,632,464.38, which Nacchio was later ordered to forfeit to the United States following his conviction for insider trading with respect to those profits. The government opposed Nacchio’s request, contending that his forfeiture payment was a nondeductible penalty or fine and that he was estopped from seeking tax relief because of his criminal conviction. The parties filed cross-motions for summary judgment.

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June 13, 2016 in Celebrity Tax Lore, New Cases, Tax | Permalink | Comments (0)

Bentley University Seeks To Hire A Tenure-Track Tax Prof

BentleyBentley University (Waltham, MA) is seeking to hire a tenure-track Assistant Professor of Law in its Law, Tax & Financial Planning Department:

The Law Taxation and Financial Planning Department at Bentley University, located in the suburbs of Boston, Massachusetts, is seeking a full-time tenure-track Assistant Professor of Law to start in July 2017. With a strong faculty of teacher-scholars, Bentley strives to lead higher education in the integration of global business with the arts and sciences, information technology, and corporate ethics and social responsibility. Providing an intellectually stimulating academic community for both faculty and students, Bentley supports its faculty as they pursue high quality and impactful cutting-edge research and bring their expertise and real world experiences into the classroom. We seek individuals who represent different backgrounds, interests and talents and who share a commitment to the fusion of business and arts & sciences education, information technology, and business ethics.

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June 13, 2016 in Legal Education, Tax, Tax Prof Jobs | Permalink | Comments (0)

Wu:  Higher Education And Legal Education Are Headed Toward Disaster

Frank Wu (Former Dean, UC-Hastings), Is Higher Education Headed Toward Disaster?:

I will be honest. I’m surprised nobody has shouted this already.

The latest news about higher education is dire. We might be headed for disaster. The “discount rate” has reached record levels for many institutions.

Discount

[F]or an increasing number of schools, the “discount rate” should be triggering alarms. It has become the means, at best a stop-gap, of “enrollment management.”

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June 13, 2016 in Legal Education | Permalink | Comments (6)

Trump 2.0 Tax Plan Under Discussion

Trump Tax Plan

Bloomberg:  Less Costly ‘Trump 2.0’ Tax Plan Urged by Reagan-Era Economists, by Lynnley Browning:

Donald Trump has said his main tax-policy goal is a cut for the middle class, yet his guest list for a series of policy presentations at Trump Tower included a Reagan-era economist who has suggested revamping that plan.

Lobbyists and business leaders, including oil billionaire and Trump ally Harold Hamm, gathered June 9 at the presumptive Republican nominee’s New York headquarters to present their policy wish lists. Among them: economist Stephen Moore, who has been offering Trump advice on tax policy -- particularly suggestions for cutting his plan’s estimated cost of $10 trillion over 10 years.

But Moore and fellow conservative economist Lawrence Kudlow have recommended changes that would “all but erase” the middle-class benefits Trump favors, according to Kyle Pomerleau, a senior policy specialist at the right-leaning Tax Foundation in Washington. The foundation, a non-profit research group, reviewed the revisions at the request of Moore and Kudlow. 

Trump hasn’t committed to any of their suggestions, and spokeswoman Hope Hicks told the New York Times last month that Moore and Kudlow don’t speak for the campaign. Nonetheless, Moore’s appearance at Thursday’s Trump Tower conclave -- where he said he was one of the presenters -- suggests that the final contours of Trump’s tax plan remain under discussion.

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June 13, 2016 in Tax | Permalink | Comments (1)

Brooks:  Using Facts Of Tax Cases To Reveal Something About Who We Are

Kim Brooks (Dalhousie), The High Cost of Transferring the Dream:

This paper is part of a larger project where I use the facts in tax decisions to reveal something about who we are. It looks through a small window into the lives of the people who find themselves caught between our collective and their individual expenditure aspirations. More specifically, it explores the circumstances in which individuals find that their outstanding tax debts pose a threat to their ability to maintain ownership of their home.

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June 13, 2016 in New Cases, Scholarship, Tax | Permalink | Comments (0)

ABA Section Of Legal Education And Admissions To The Bar 2016-17 Council Nominees

ABA Section on Legal EdABA Section of Legal Education and Admissions to the Bar, Nominating Committee Announces 2016-2017 Council Slate:

The Nominating Committee, chaired by the Honorable Solomon Oliver Jr., Chief Judge of the U.S. District Court for the Northern District of Ohio, presented the following slate to the Council. The election of Council officers and members will take place at the Section’s annual business meeting, Saturday, August 6, 10:15-11:15 a.m., at the Park Central San Francisco during the ABA Annual Meeting.

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June 13, 2016 in Legal Education | Permalink | Comments (1)

WaPo:  How An Obscure Nonprofit In Washington Protects Tax Havens For The Rich

Center for Freedom & ProsperityWashington Post, How An Obscure Nonprofit In Washington Protects Tax Havens For The Rich:

In May 2007, during a global crackdown on offshore tax havens, an obscure nonprofit lobbying group in Northern Virginia sent a fundraising pitch to a law firm in one of the biggest tax havens in the world — Panama.

The Center for Freedom and Prosperity promised to persuade Congress, members of the George W. Bush administration and key policymakers to protect the players of the offshore world, where hundreds of thousands of shell companies had been created, often to hide money and evade taxes.

To reach out to American officials and fund its U.S. operations, the center said it needed an infusion of cash for an eight-month campaign: at least $247,000. ...

In the eight-page fundraising document discovered by The Post, the Center for Freedom and Prosperity in Alexandria, Va., said that it had already persuaded the Bush administration to thwart an international effort to require more transparency from tax havens. Now the center was promising to derail similar reforms in legislation before Congress.  ...

“It’s sort of like fishing, you have to keep casting your lure,” said Daniel Mitchell, one of the directors of the center, in a recent interview with The Post. ...

Former senator Carl Levin (D-Mich.), once one of the leading voices in Congress on tax haven abuses, said in a recent interview that the center’s activities run counter to America’s values and undermine the nation’s ability to raise revenue.

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June 13, 2016 in Tax | Permalink | Comments (0)

Update On Murder-For-Hire Investigation Into Dan Markel's Death

Tallahassee Democrat, Mystery Endures: What We Don't Know About the Markel Investigation:

A surge of initial details following the first arrest in the 2014 killing of Dan Markel provided a rough but compelling outline of what investigators say happened to the Florida State law professor.

But more than a week after the bombshell probable cause report for the arrest of 34-year-old Sigfredo Garcia was made public, many key questions remain unanswered.

With no more arrests — so far — theories still swirl in the case that has captivated Tallahassee and beyond.

Here are some of the outstanding mysteries yet to be revealed:

  • Anatomy of a Hit [interactive]

Anatomy

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June 13, 2016 in Legal Education | Permalink | Comments (4)

Medtronic Wins $2 Billion Transfer Pricing Tax Court Case

MedtronicBloomberg BNA, Tax Court Slams IRS ‘Medtronic'Analysis, Says $2B Too Much:

The IRS grossly underrated the contributions of Medtronic Inc.'s Puerto Rican affiliate to the quality of the company's products, the U.S. Tax Court ruled, finding for the medical device maker in its $2 billion transfer pricing dispute (Medtronic v. Commissioner, T.C. Memo. 2016-112 (June 9, 2016)).

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June 13, 2016 in New Cases, Tax | Permalink | Comments (0)

Thirty Reflection Questions To Help Law Students Find Meaningful Employment And Develop An Integrated Professional Identity

Neil W. Hamilton (St. Thomas ) & Jerome M. Organ (St. Thomas), Thirty Reflection Questions to Help Each Student Find Meaningful Employment and Develop an Integrated Professional Identity (Professional Formation), 83 Tenn. L. Rev. ___ (2016):

Law schools must now define learning outcomes for their programs of legal education. Many law schools (and many professors in individual courses) are defining learning outcomes that include values beyond just minimal compliance with the law of lawyering — called here professional-formation learning outcomes.

This article, drawing on and synthesizing scholarship from law and other disciplines, will focus on the design of a curriculum with thirty reflection questions to help each student’s step-by-step development toward professional-formation learning outcomes beyond mere compliance with the law of lawyering. Section I of this article will describe the present context in which law schools must develop learning outcomes, and will highlight the number of law schools that have embraced one or both of the elements of a professional-formation learning outcome where a law school or a professor in an individual course requires that each student demonstrate an understanding and integration of:

1. proactive professional development toward excellence at all the competencies needed to serve clients and the legal system well;
2. an internalized deep responsibility to clients and the legal system.

Section II of the article analyzes the principles that should inform the design of an effective curriculum for these two professional-formation learning outcomes. Section III of the article will suggest thirty reflection questions that help each student:

1) reflect on the story, experiences and passions that brought her to law school and that she develops during law school as a means of both (a) identifying what she wants to do with her law degree and (b) proactively taking ownership over her growth toward meaningful post-graduate employment; and
2) make progress moving through developmental stages regarding these two professional formation learning outcomes; so that
3) she can begin to define and to live out who she wants to be as a lawyer in the context of what clients and the legal system expect of her.

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June 13, 2016 in Legal Education, Scholarship | Permalink | Comments (1)

The IRS Scandal, Day 1131

House LogoH.R. Rep. No. 612, 114th Cong., 2d Sess.:

I. SUMMARY AND BACKGROUND

A. PURPOSE AND SUMMARY

H.R. 5053, as reported by the Committee on Ways and Means, would prohibit the Internal Revenue Service (IRS) from collecting the identity of donors who contribute to tax-exempt organizations. Under this legislation, a tax-exempt organization would be required to report only information on donors who contribute $5,000 or more during a single tax year and who are either an officer or director of the organization or one of its five highest paid employees. This information would be excluded from public disclosure.

B. BACKGROUND AND NEED FOR LEGISLATION

Current law requires section 501(c)(3) tax-exempt organizations to report information on substantial donors. The IRS defines a substantial donor as a contributor who gives $5,000 or more to an organization in a calendar year. This information is reported on the Schedule B of the Form 990. The requirement to file a Form 990 applies to tax-exempt organizations generally, not just to section 501(c)(3) tax-exempt organizations. Thus, the IRS has expanded the substantial donor reporting requirements to more than section 501(c)(3) tax-exempt organizations. While the IRS does not make this information public, there have been instances where IRS employees have improperly accessed and released the Schedule B donor list. A notable example is the National Organization for Marriage, which had information from its Schedule B leaked in 2012 and the IRS subsequently paid $50,000 to settle a lawsuit with the organization claiming that the IRS improperly accessed the information. Certain states, including California, have moved to make Schedule B information public. The move to publicize Schedule B information was the subject of a recent lawsuit, Americans for Prosperity Foundation v. Kamala Harris, Attorney General for California. The Attorney General of California wanted to require that the Americans for Prosperity Foundation disclose its Schedule B to the California State Registry. In April 2016, the U.S. District Court ruled that requiring the organization to disclose its Schedule B was unconstitutional.

In recent years it was also revealed that the IRS used inappropriate criteria to target organizations applying for tax-exempt status. Additionally, the IRS is considering eliminating Schedule B entirely. H.R. 5053 would protect taxpayers from improper disclosure of Schedule B information, as well as limit the IRS’s ability to target organizations improperly. The legislation also eliminates a burdensome reporting requirement for tax-exempt organizations. ...

II. EXPLANATION OF THE BILL

A. PROHIBITION ON REQUIRING THAT IDENTITY OF CERTAIN CONTRIBUTORS TO SECTION 501(c) ORGANIZATIONS BE INCLUDED ON ANNUAL RETURNS (SEC. 32 OF THE BILL AND SEC. 6033 OF THE CODE)

PRESENT LAW

In general, organizations exempt from taxation under section 501(a) are required to file an annual return (Form 990 series), stating specifically the items of gross income, receipts, disbursements, and such other information as the Secretary may prescribe. An organization that is required to file an information return, but that has gross receipts of less than $200,000 during its taxable year, and total assets of less than $500,000 at the end of its taxable year, may file Form 990–EZ. Section 501(c)(3) private foundations are required to file Form 990–PF rather than Form 990. An organization that has not received a determination of its tax-exempt status, but that claims tax-exempt status under section 501(a), is subject to the same annual reporting requirements and exceptions as organizations that have received a tax-exemption determination.

On the applicable annual information return, organizations are required to report their gross income, information on their finances, functional expenses, compensation, activities, and other information required by the IRS in order to review the organization’s activities and operations during the previous taxable year and to review whether the organization continues to meet the statutory requirements for exemption. Examples of the information required by Form 990 include: (1) a statement of program accomplishments; (2) a description of the relationship of the organization’s activities to the accomplishment of the organization’s exempt purposes; (3) a description of payments to individuals, including compensation to officers and directors, highly paid employees and contractors, grants, and certain insider transactions and loans; and (4) disclosure of certain activities, such as expenses of conferences and conventions, political expenditures, compliance with public inspection requirements, and lobbying activities.

Form 990–PF requires, among other things, reporting of: the foundation’s gross income for the year; expenses attributable to such income; disbursements for exempt purposes; total contributions and gifts received and the names of all substantial contributors; names, addresses, and compensation of officers and directors; an itemized statement of securities and other assets held at the close of the year; an itemized statement of all grants made or approved; and information about whether the organization has complied with the restrictions applicable to private foundations (secs. 4941 through 4945).

An organization that files Form 990, Form 990–EZ, or Form 990– PF and receives during the year $5,000 or more (in money or property) from any one contributor generally must report such contributions on Schedule B (‘‘Schedule of Contributors’’). The Schedule B is open to public inspection for an organization that files Form 990–PF (private foundations) or a section 527 political organization that files Form 990 or Form 990–EZ. For all other Form 990 and Form 990–EZ filers, the names and addresses of contributors are not required to be made available for public inspection. All other information, including the amount of contributions, the description of noncash contributions, and any other information, is required to be made available for public inspection unless it clearly identifies the contributor. As a matter of practice, the IRS does not include Schedule B on the CD sets or any other form of media made available to the public. Instead, on a case-by-case basis, when an individual makes a request for a specific organization’s Schedule B, the IRS reviews and redacts the schedule in an effort to avoid divulging information that would identify any contributor. 

The requirement that an exempt organization file an annual information return (Form 990 or Form 990–EZ) does not apply to certain exempt organizations, including organizations (other than private foundations) the gross receipts of which in each taxable year normally are not more than $50,000. Organizations that are excused from filing an information return by reason of normally having gross receipts below such amount must furnish to the Secretary an annual notice (Form 990–N), in electronic form, containing certain basic information about the organization.

Other organizations exempt from the annual information return requirement include: churches, their integrated auxiliaries, and conventions or associations of churches; the exclusively religious activities of any religious order; certain State institutions whose income is excluded from gross income under section 115; an interchurch organization of local units of a church; certain mission societies; certain church-affiliated elementary and high schools; and certain other organizations, including some that the IRS has relieved from the filing requirement pursuant to its statutory discretionary authority.6

REASONS FOR CHANGE

The Committee is concerned that the IRS is collecting sensitive information about donors who contribute to tax-exempt organizations. Although the IRS is required by law to maintain the confidentiality this information, the Committee is aware of instances in which the information was released to third parties. Furthermore, the Committee is concerned that the IRS might use donor information to penalize tax-exempt organizations or donors based on their political beliefs. By limiting the contribution information taxexempt organizations report to the IRS, the provision will protect taxpayers’ identities and help prevent inappropriate political targeting by the IRS. In addition, the Committee believes the Schedule B provides little administrative benefit to the IRS. In fact, senior leadership of the IRS’s Exempt Organizations Division has stated recently that the IRS is considering eliminating the Schedule B filing requirement.

EXPLANATION OF PROVISION

The provision limits the contributor information that must be reported by an organization described in section 501(c) on its annual information return. Under the provision, except as described below, the Secretary may not require an organization to report the name, address, or other identifying information of any contributor to the organization with respect to any contribution, grant, bequest, devise, or gift of money or property, regardless of amount.

The provision provides two exceptions to this prohibition. First, the Secretary is not prohibited from requiring the information described in section 6033(a)(2) relating to prohibited tax shelter transactions. Second, the Secretary is not prohibited from continuing to require reporting of contributions, grants, bequests, devises, or gifts of money or property in excess of $5,000 made by an officer or director of the organization (or an individual having powers to responsibilities similar to those of officers or directors) or by a covered employee. Covered employee means any employee (including any former employee) of the organization if the employee is one of the five highest compensated employees of the organization for the taxable year. For this purpose, an employee’s compensation includes compensation from the organization as well as any compensation paid with respect to the employment of such employee by any related person or governmental entity. A person or governmental entity is treated as related to the organization if it: (1) controls or is controlled by the organization; (2) is controlled by one or more persons that control the organization; (3) is a supported organization (as defined in section 509(f)(3)) during the taxable year with respect to the organization; (4) is a supporting organization described in section 509(a)(3) with respect to the organization; or (5) in the case of an organization that is a voluntary employees’ beneficiary association described in section 501(c)(9), establishes, maintains, or makes contributions to such voluntary employees’ beneficiary association.

The provision makes a conforming amendment to section 6033(b), which describes certain information that a section 501(c)(3) organization must include on its annual information return. ...

VII. DISSENTING VIEWS

We oppose H.R. 5053, which would prohibit the Secretary of the Treasury from collecting the name, address, or other identifying information of contributors to any tax-exempt, 501(c) organization except in limited circumstances. This bill would open the floodgates for unlimited, anonymous, unaccountable money to pour into U.S. elections—including possibly from foreign sources.

Under present law, certain 501(c) organizations must attach to their annual information returns (IRS Forms 990) a list (Schedule B) of donors who contribute $5,000 or more during the year (‘‘substantial contributors’’). The Schedule B is kept confidential by the Internal Revenue Service (IRS) and is not made public.

Certain 501(c) organizations, such as social welfare organizations, are permitted to engage in political activity. These politically active 501(c)(4) organizations are required to disclose their substantial contributors to the IRS but are not required to disclose them to the public.

There has been a sharp rise in undisclosed money being spent by tax-exempt groups in federal elections since the Supreme Court issued its 2010 Citizens United decision. This bill would make it even easier for donors to anonymously funnel money in support of political candidates. Already in this election cycle, according to the Center for Responsive Politics, political spending by tax-exempt groups is five times the amount spent at this point during the 2012 election cycle.

It is no secret as to why Republicans are working to keep donors a secret: the three largest spenders from 2012—representing fully 51% of the total—include Karl Rove’s Crossroads GPS (that spent $71 million); the Koch Brothers’ Americans for Prosperity (that spent $36 million); and the Koch Brothers’ American Future Fund (that spent $25 million). It is no surprise the Koch Companies Public Sector, LLC sent a letter to Republican Members on the day of the markup urging them to support the bill. Simply put, H.R. 5053 does nothing more than solidify the secrecy around the Republicans’ big campaign efforts.

The bill also potentially opens the door for unlimited, secret money from foreign governments or individuals to be funneled into our elections. Currently, foreign money cannot be given or spent in our elections. The only real protection we have against the use of foreign money by politically active social welfare organizations is that they must disclose their substantial contributors to the IRS. This requirement means that tax-exempt, 501(c)(4) groups know they can be held accountable if they illegally spend foreign money in federal elections. Campaign finance reform groups opposing this bill warned that, if donor disclosure to the IRS is eliminated, no one will know whether a social welfare organization has received foreign funds and is illegally spending them in our elections.

We should not support efforts to reduce transparency and make it easier for donors to pour unlimited funds into political campaigns. For these reasons, we oppose this bill.

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June 13, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

TaxProf Blog Weekend Roundup

Sunday, June 12, 2016

The Story Of Tonight:  With Billion-Dollar Hamilton Poised To Sweep Tony Awards, Broadway Pushes For Tax Break Extension

Hamilton 2Bloomberg, As ‘Hamilton’ Enriches Backers, Broadway Wants Tax Break Extended:

Alexander Hamilton introduced the idea of federal taxes. Broadway producers enjoying a record season buoyed by his namesake musical are lobbying Congress to limit what they owe.

The industry, which will celebrate its success tonight at the Tony Awards, is fighting to keep a provision that allows live-theater backers deductions in a show’s first year. That means they’d pay tax on income only after turning a profit. The provision passed in 2015, yet needs to be extended by Congress this year to survive.

In an industry where four of five performances close without recouping startup costs, producers say such a sweetener will keep the hits coming. While the provision was tacked onto a list of tax breaks last year at the behest of Sen. Chuck Schumer, D-N.Y., there’s no guarantee it will be continued, producers and their lobbyists say. Some lawmakers don’t like the idea. Nor do advocates of tax cuts, who say such breaks make it more difficult to reduce the burden on everyone else. ...

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June 12, 2016 in Celebrity Tax Lore, Tax | Permalink | Comments (1)

NY Times:  Messages To Graduates Of The Class Of 2016

New York Times, Message to Graduates: Times Are Tough, but You Can Make It:

Thousands of college graduates across the nation have gathered with families and friends over the past few weeks to mark not just receiving their degree, but a symbolic crossing from childhood to adulthood. Commencement speakers gave them their marching orders.

If commencement speeches reflect the times we live in, then this year’s entries suggest the times are bleak. The common themes are almost biblical. Among them are resilience, overcoming adversity, not fearing failure and taking risks.

But wait, graduates! Take heart, this year’s commencement sages go on to say. Just because you are leaving college in an uncertain job market during one of the most angry and unpredictable presidential election seasons in memory, and are quite possibly destined to return home to live with your parents, it does not mean that you will not ultimately profit from your experience of hardship and self-doubt. Do not give in to the forces of darkness and despair, the speakers urged the Class of 2016, for you will emerge stronger in the end.

The New York Times prints excerpts with links to these fifteen 2016 graduation speeches:

Hank Azaria (video), actor and Tufts alumnus
Tufts University, Medford, Mass.

Michael Bloomberg (video), business executive and former New York City mayor
University of Michigan, Ann Arbor, Mich.

John Kerry (video), Secretary of state
Northeastern University, Boston

John Lewis (video), congressman and civil rights leader
Washington University in St. Louis

Loretta Lynch (video), Attorney General
Spelman College, Atlanta

Lin-Manuel Miranda (video), creator of “Hamilton”
University of Pennsylvania, Philadelphia

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June 12, 2016 in Legal Education | Permalink | Comments (0)

The Top 5 Tax Paper Downloads

SSRN LogoThere is quite a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new #1 paper and a new paper debuting on the list at #4:

  1. [412 Downloads]  Google's 'Alphabet Soup' in Delaware, by Bret Bogenschneider (Vienna) & Ruth Heilmeier (Cologne)
  2. [328 Downloads]  New Prominence Of Tax Basis In Estate Planning, by Paul L. Caron (Pepperdine) & Jay A. Soled (Rutgers)
  3. [241 Downloads]  Following the Money: Lessons from the Panama Papers, Part 1: Tip of the Iceberg, by Lawrence Trautman (American)
  4. [194 Downloads]  Why Does Inequality Matter? Reflections on the Political Morality of Piketty's Capital in the Twenty-First Century, by Liam Murphy (NYU)
  5. [187 Downloads]  'Death Tax' Politics, by Michael J. Graetz (Columbia)

June 12, 2016 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

WSJ:  How To Cheat Your Fitbit And Win Fitness Challenges

SurgeI am a Fitbit fanatic, assiduously tracking my exercise and sleep on my Surge (right).  The Wall Street Journal opened my eyes on how I can jack up my numbers in our intra-family fitness wars in a front page article,  Want to Cheat Your Fitbit? Try a Puppy or a Power Drill:

Workplace "step challenges" are big with companies aiming to encourage employee fitness. In pursuit of victory, some workers are using power tools, pets and household appliances to fool digital fitness trackers and boost their step totals without lifting a foot.

During a step challenge at an electronics-manufacturing firm in Texas, suspiciously high activity on one employee’s fitness tracker prompted a call from Sonic Boom Wellness, the Carlsbad, Calif.-based company running the challenge. After a brief interrogation, the man came clean: He had clipped his tracker to a hamster wheel.

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June 12, 2016 in Legal Education, Tax | Permalink | Comments (1)

The IRS Scandal, Day 1130

IRS ChurchThe Surly Subgroup:  Tying the IRS’s Hands. Even Tighter, by Sam Brunson (Loyola-Chicago):

Yesterday, the House Committee on Appropriations reported H.R. 2995 to the House of Representatives. H.R. 2995, the Financial Services and General Government Oversight Appropriations Bill  for FY 2017, if passed, would continue the trend of reducing the IRS’s budget, this time by $236 million. ...

I’m interested in an amendment added yesterday by Rep. John Culberson (R-TX). Section 135 of the bill would make it even harder than it already is for the IRS to audit churches. 

The IRS already faces significant limitations on its ability to audit churches. ... The result? Churches are rarely audited, and even more rarely lose their exemptions. While the IRS doesn’t disclose the number of church audits it performs, the ECFA suggests that there may be 100 church audits a year. And how many churches are there in the U.S.? Again, hard to say, but the U.S. Religion Census finds about 345,000 congregations in the U.S. That would be a 0.03% audit rate; even assuming the number of churches is off by a factor of 10, we’re talking a 0.3% audit rate. And I can only find one report of a church losing its exemption for violating the campaigning prohibition (even though thousands of churches have deliberately and explicitly violated it).

That, though, is apparently insufficient for Rep. Culberson, who claims he added his amendment to “protect churches from being bullied by the Internal Revenue Service (IRS) and left-wing activists whenever a church engages in educational political activity.”

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June 12, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Saturday, June 11, 2016

This Week's Ten Most Popular TaxProf Blog Posts

Yale Tiger Mom's Advice For Parenting Adult Children: Contracts

TMCFollowing up on my previous posts:

Wall Street Journal:  The ‘Tiger Mother’ Has a Contract for Her Cubs, by Amy Chua (Yale):

I recently had a harrowing parenting experience, which I addressed through recourse to the law.

My daughters Sophia and Lulu are now 23 and 20, and they’re both working in New York City this summer. Their plan is to stay (for free) in our Manhattan apartment—the pied-à-terre that my husband, Jed, and I spent 20 years saving up for.

I was on the phone with one of my daughters. “I’m so excited to spend some time in New York this summer—so many of my friends are going to be there!” she said happily.

“Me too!” I said. “I can’t wait.”

Pause.

“Wait—what?” she said. “You’re going to be in the apartment too?”

“What do you mean am I going to be in the apartment? Of course I’m going to be in the apartment. It’s daddy’s and my apartment.”

“But you live in New Haven.”

My head started to explode.

I suddenly realized that I was on the verge of becoming a tenant farmer in my own life.

Fortunately, I teach contracts law at Yale, and I came up with a solution. I made my daughters sign a contract—totally valid and legally enforceable—the text of which is reproduced below. ...

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June 11, 2016 in Legal Education | Permalink | Comments (3)

11th Annual Junior Tax Scholars Workshop Concludes Today At UC-Irvine

UC Irvine Logo (2016)Panel #5:  Exempt Organizations/Individual Planning

Manoj Viswanathan (UC-Hastings), Tax Compliance in a Decentralizing Economy
Commentators:  Philip Hackney (LSU), Khrista Johnson (Pepperdine)

Philip Hackney (LSU), Subsidizing the Heavenly(?) Chorus
Commentators:  Manoj Viswanathan (UC-Hastings), Lilian Faulhaber (Georgetown)

Tessa Davis (South Carolina), Reconsidering Alimony and Tax
Commentators:  Khrista Johnson (Pepperdine), Sloan Speck (Denver)

Panel #6:  Grab Bag

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June 11, 2016 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Taxes Could Wipe Out Half Of Prince's $250 Million Estate

Following up on my previous posts (links below) on the estate planning aspects of Prince's death: People Magazine, Taxes Could Wipe Out Half of Prince's $250 Million Estate and Force Early Sale of His Unreleased Songs, Trustee Says:

Prince's estate is getting hit with a hefty tax bill that could end up taking half of his estimated $250 million fortune – and force the early sale of some of the vast troves of unreleased music that the Purple One had locked up in his vault, the trustee for the estate revealed.

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June 11, 2016 in Celebrity Tax Lore, Tax | Permalink | Comments (1)

The IRS Scandal, Day 1129

IRS Logo 2Omaha World-Herald editorial, IRS Stonewalling:

The Internal Revenue Service has, at long last, made public a list of 426 politically conservative organizations targeted by its tax-exempt division.

It took a lawsuit and three long years to pry all of the information into public view. That’s outrageous. But then, foot-dragging and obfuscation have been the agency’s tactics from the start of this sorry affair.

The official at its center, Lois Lerner, took refuge behind the Fifth Amendment when called to answer questions from Congress. Then the IRS claimed that a crash of Lerner’s computer made it “impossible” to produce her emails — until 30,000 were recovered by a Treasury Department inspector general.

All of this does nothing to reassure taxpayers of the agency’s needed fairness. ...

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June 11, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, June 10, 2016

Brunson:  Is It Time To Ban Clickers In The Law School Classroom?

ClickersThe Surly Subgroup:  Teaching Tax — On Clickers and Laptops, by Sam Brunson (Loyola-Chicago):

I’ve used clickers in class ever since I started teaching. In fact, thanks to Paul Caron’s tireless advocacy, I’ve known I was going to use clickers since before I entered academia.

And, like Paul, both I and my students have found clickers tremendously helpful in the classroom. In my experience, they do three main things:

  • They force all students to actively engage with the class. It’s easy enough to sit back in class and passively absorb (or not) the content. Sure, whomever I call on has to actively engage, but I can only call on a small portion of my class on any given day. But clicker questions allow students to not only listen, but actually answer, at least a handful of questions.
  • They tell me how well the students grasp what I’m teaching. If most of the students get the right answer, I know my explanation and the discussion were helpful. If a significant portion get it wrong, I know that I need to go back and address it again (and, depending on the answers they choose, I may be able to figure out where I or they went wrong).
  • They tell my students how well they grasp what I’m teaching. If most of the students get the problem right, a student who gets it wrong knows that she may need to go back and review the topic. Or ask a question. Or do something else.

But I have a problem: ...

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June 10, 2016 in Legal Education, Teaching | Permalink | Comments (3)

Disney CEO:  U.S. Tax Law Is Mickey Mouse

Mickey MouseCNN, Disney CEO: U.S. Taxes Are 'Too High' and 'Ridiculously Complex':

Disney CEO Bob Iger thinks companies -- including his -- are simply paying too much in tax to Uncle Sam.

Iger told CNNMoney on Thursday that high corporate tax rates in the U.S. are "anti-competitive," and described the country's tax system as "ridiculously complex."

"It doesn't mean that a company shouldn't pay taxes, but I think the structure is off ... the tax base should be lowered, and the loopholes should be closed," Iger said, without elaborating on potential reforms.

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June 10, 2016 in Tax | Permalink | Comments (7)

IRS Announces Winners Of Tax Design Crowdsourcing Challenge

IRSThe IRS today announced (IR-2016-86) announced the winners of its first Tax Design Crowdsourcing Challenge:

The Internal Revenue Service today announced the winners of its first crowdsourcing competition, called the Tax Design Challenge, that encouraged innovative ideas for the taxpayer experience of the future.

Out of 48 submissions, winners from California, Minnesota and Washington, D.C., were among those selected in categories covering overall design, taxpayer usefulness and best financial capability.

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June 10, 2016 in IRS News, Tax | Permalink | Comments (2)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

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June 10, 2016 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

11th Annual Junior Tax Scholars Workshop Kicks Off Today At UC-Irvine

UC Irvine Logo (2016)Panel #1:  Tax Bases

Erin Scharff (Arizona State), Pigouvian User Fees
Commentators:  Goldburn Maynard (Louisville), Tessa Davis (South Carolina)

Goldburn Maynard (Louisville), A Plea for Courts to Abolish the Judicially Created Right of the Wealthy to Avoid Estate Taxes
Commentators:  Erin Scharff (Arizona State), Philip Hackney (LSU)

Emily Satterthwaite (Toronto), Chain Effects and the Small Supplier Election
Commentators:  Ari Glogower (Ohio State), Omri Marian (UC-Irvine)

Ari Glogower (Ohio State), Wealth Integration
Commentators:  Emily Satterthwaite (Toronto), Andrew Hayashi (Virginia)

Panel #2:  Compliance

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June 10, 2016 in Conferences, Scholarship, Tax | Permalink | Comments (0)

CBO:  The Distribution Of Household Income And Federal Taxes, 2013

Congressional Budget Office, The Distribution of Household Income and Federal Taxes, 2013:

In 2013, according to the Congressional Budget Office’s estimates, average household market income— a comprehensive income measure that consists of labor income, business income, capital income (including capital gains), and retirement income—was approximately $86,000. Government transfers, which include benefits from programs such as Social Security, Medicare, and unemployment insurance, averaged approximately $14,000 per household. The sum of those two amounts, which equals before-tax income, was about $100,000, on average. In this report, CBO analyzed the distribution of four types of federal taxes: individual income taxes, payroll (or social insurance) taxes, corporate income taxes, and excise taxes. Taken together, those taxes amounted to about $20,000 per household, on average, in 2013.1 Thus, average after-tax income—which equals market income plus government transfers minus federal taxes— was about $80,000, and the average federal tax rate (federal taxes divided by before-tax income) was about 20 percent.

CBO

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June 10, 2016 in Congressional News, Gov't Reports, Tax | Permalink | Comments (1)

Dan Markel's Law Prof Colleagues Finger Ex-Wife's Family In Murder-For-Hire Killing

PeoplePeople Magazine, Colleagues of Murdered Florida Law Professor Suspected Link to Bitter Divorce from Ex-Wife: 'I Hope to God She Wasn't Involved':

Colleagues of the popular Florida law professor Dan Markel, who was fatally shot execution-style in July 2014, say they long feared the recent revelation by authorities who said his death was tied to a bitter divorce with his ex-wife, a fellow law professor.

"A number of people here – and that includes myself – had some suspicions about her family because of a number of things that Danny had confided," says Fernando Teson, another law professor at Florida State University who counted Markel and his then-wife Wendi Adelson as friends before she filed for divorce in 2012. "I see now that my instincts were right, but it's still just incredibly shocking that this would happen. I don't want to accuse anybody," he says, "but I always had a funny feeling that this had to be connected to the custody battle somehow." ...

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June 10, 2016 in Legal Education | Permalink | Comments (2)

Crawford:  Valuation, Values, Norms — Proposals For Estate And Gift Tax Reform

Bridget Crawford (Pace), Valuation, Values, Norms: Proposals for Estate and Gift Tax Reform, 57 B.C. L. Rev. 979 (2016):

In their contributions to the Symposium on The Centennial of the Estate and Gift Tax, Professor Joseph Dodge, Professor Wendy Gerzog, and Professor Kerry Ryan offer concrete proposals for improving the existing estate and gift tax system.

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June 10, 2016 in Scholarship, Tax | Permalink | Comments (0)

NYLS Hosts Third National Symposium On Experiential Learning In Law

NYLS

Third National Symposium On Experiential Learning In Law (agenda):

The 2016 Third National Symposium on Experiential Learning in Law will take a careful look at how to identify and effectively assess experiential learning outcomes in the legal education context. This symposium will offer highly interactive sessions that will provide learning designed to improve the quality of assessment in law schools’ experiential programs.

Assessment is the pedagogical topic of our time.

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June 10, 2016 in Conferences, Legal Education | Permalink | Comments (1)

The IRS Scandal, Day 1128

IRS Logo 2The Hill, House Panel Votes to Cut IRS Funding:

The House Appropriations Committee on Thursday approved a spending bill that would reduce funding for the Internal Revenue Service (IRS).

The bill would give the IRS $10.9 billion for fiscal 2017, which is $236 million less than the enacted level for this year.

The IRS budget under the bill would be lower than its 2008 level and $1.3 billion less than President Obama requested in his budget. The bill also includes provisions to stop the IRS from further implementing ObamaCare and to increase oversight of the IRS in the wake of its political-targeting scandal.

Republicans supported the bill’s treatment of the IRS.

Rep. Ander Crenshaw (R-Fla.), chairman of the subcommittee with jurisdiction over the bill, said that instead of turning over a new leaf after the targeting scandal came to light, “the IRS made a series of embarrassing management mistakes at the expense of customer service.”

But Democrats expressed concerns about the cuts to the IRS. Rep. José Serrano (D-N.Y.), the top Democrat on the subcommittee, said that “by continually cutting the IRS, we are simply empowering tax cheats and confusing honest taxpayers.”

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June 10, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Thursday, June 9, 2016

Logue Responds To Galle's In Praise Of Ex Ante Regulation

Kyle Logue (Michigan), In Praise of (Some) Ex Post Regulation: A Response to Professor Galle, 69 Vand. L. Rev. En Banc 97 (2016):

Professor Brian Galle recently argued [In Praise of Ex Ante Regulation, 68 Vand. L. Rev. 1715 (2015)] that the growing consensus that ex post regulation is superior to ex ante regulation on efficiency grounds has been overstated by scholars, including me, and that ex ante regulation has advantages that have been ignored or underemphasized.

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June 9, 2016 in Scholarship, Tax | Permalink | Comments (0)

Graetz & Greenhouse:  The Burger Court And The Rise Of The Judicial Right

Burger CourtMichael J. Graetz (Columbia) & Linda Greenhouse (New York Times), The Burger Court and the Rise of the Judicial Right (June 7, 2016).  From Columbia Law School:

Early reviews are extolling the insights of The Burger Court and the Rise of the Judicial Right, the new book by Columbia Law School Professor Michael J. Graetz and Pulitzer Prize-winning journalist Linda Greenhouse. Graetz—the author of seven books, an eminent scholar and teacher, and a former official in the U.S. Treasury Department—is the Columbia Alumni Professor of Tax Law. He has argued before the Supreme Court. For nearly 30 years, Greenhouse covered the Supreme Court for The New York Times

The Burger Court and the Rise of the Judicial Right, published today by Simon & Schuster, challenges the accepted portrayal of the Supreme Court from 1969 to 1986 as pragmatic and accommodating, a moderate or transitional period when “nothing much happened.” On the contrary, explain Graetz and Greenhouse, American law moved to the right with President Richard Nixon’s four appointments to the Supreme Court, including Chief Justice Warren Burger. A new conservative majority reacted to the previously liberal Court under Chief Justice Earl Warren, curbing and rolling back landmark rulings on civil rights and civil liberties, while granting a First Amendment right to “commercial speech,” which would enable businesses to invoke the Constitution in opposition to government regulation. The Burger Court and the Rise of the Judicial Right shows how the Court reached its most lasting decisions, laying a legal foundation for the conservative Rehnquist and Roberts Courts. ...

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June 9, 2016 in Book Club, Legal Education, Scholarship, Tax | Permalink | Comments (1)

University Of Washington Combats Salary Compression ('Loyalty Tax') With Faculty Vote On Retention Bonuses To Star Professors

UWInside Higher Education, University of Washington Plan Seeks to Alleviate Faculty Salary Compression:

Salary compression — when assistant professors make close to what associate and full professors make due to changes in the market between their points of hire — is a problem across academe. But fixing it is a complicated undertaking that some institutions avoid. ...

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

AAUP Handbook:  Best Practices In Peer Review

AAUP Handbook, Best Practices in Peer Review (2016):

AAUPThe purpose of this document, written by the AAUP’s Acquisitions Editorial Committee, is to articulate a set of practices that comprise a rigorous process of peer review. The Committee acknowledges, however, that the peer review process is highly complex, involves many individuals, and must be responsive to the norms of the appropriate fields. Thus, while the steps discussed below are recognized as generally acceptable best practices, this document is not intended to prescribe the conduct of an acceptable peer review in every case. Moreover, though strong peer reviews are necessary for moving forward with a project, they form only one part of a broad range of factors, including considerations of fit and budget, that together lead to a publishing decision.

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

University Of Chicago Dean Resigns Amid 10% Budget Cuts Imposed On Academic Departments

University of ChicagoCrain's Chicago Business, Dean Steps Down Amid U of C Budget Pressures:

The dean of the humanities division at the University of Chicago quit with a year left in her term today, underscoring pressures on scholars to cut costs and initiate layoffs at the Hyde Park campus.

Martha Roth, an ancient Near East scholar and dean for nine years, only hinted at the financial challenge in an email disclosing her resignation, effective June 30:

A colleague said she cited in a meeting last week an administration mandate to slice spending by 8 percent, on top of previous reductions [of 2 percent], in the fiscal year that begins next month.

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June 9, 2016 in Legal Education | Permalink | Comments (5)

NY Times:  Two Williams & Connolly Tax Lawyers Ordered To Testify In Client’s Tax Evasion Case Under Crime Fraud Exception To Attorney-Client Privilege

WilliamsNew York Times Deal Book, Lawyers Ordered to Testify on Client’s Tax Evasion Case:

It is not every day that two prominent lawyers are brought before a federal grand jury and directed to provide documents and testimony about conversations they had with a wealthy client.

But that is what happened with two partners at Williams & Connolly, the prestigious Washington law firm, who are representing Morris E. Zukerman, a former Morgan Stanley banker and oil investor. Last month, Mr. Zukerman was accused of failing to pay $45 million in income and sales taxes on works of art and profits from the sale of an oil company.

A series of court filings in Mr. Zukerman’s pending criminal case in Federal District Court in Manhattan shines a light on the often-unseen role lawyers can play in nonpublic tax investigations by the Internal Revenue Service and federal prosecutors. In the filings, federal prosecutors in Manhattan raised the prospect of potential conflict of interest for the two lawyers, who are trying to negotiate a plea deal for Mr. Zukerman.

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June 9, 2016 in Tax | Permalink | Comments (0)

Law Grad Responds To Fundraising Appeals From 'Greedy' Law School: 'Go To Hell, You Parasite'

Minneapolis Star-Tribune op-ed:  Law School Fundraising: What Have You Ever Done For Me?, by Robert G. Larson III (J.D. 2010, William Mitchell (now Mitchell Hamline)):

To my greedy law school:

No. Stop asking. I’m not going to give you any money. Ever. So you can stop sending those fundraising letters every few months, begging for more of my hard-earned cash.

I’m not blaming you for the collapse of the legal job market. ...  I’m blaming you because you lied to us. You reported employment statistics — even back in 2007, when things were decidedly rosier — that led prospective students to believe that a huge portion of your graduates walked out of your hallowed halls and right into lucrative associate positions at fancy law firms. The reality, as we now know, is that you were counting everyone with any kind of job at all — from the guy working just a few hours per week at the 7-Eleven to the girl who took your perennial temporary position in the student affairs office — as employed, for the purposes of bragging about postgraduation employment. ...

I truly, deeply regret attending law school. Full of youthful optimism, I tried to better my life through education, and was slapped down hard. Despite assurances to the contrary, the things I learned haven’t helped me in the slightest. ...

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June 9, 2016 in Legal Education | Permalink | Comments (26)

House Holds Hearing Today On The Need To Control Automatic Spending And Unauthorized Programs

HouseThe House Budget Committee holds a hearing today at 9:30 a.m. EST on The Need to Control Automatic Spending and Unauthorized Programs with these witnesses:

  • Lily Batchelder (NYU)
  • Stuart Butler (Brookings Institution)
  • David Walker (Former Comptroller General of the United States)

June 9, 2016 in Congressional News, Tax | Permalink | Comments (0)

Tax Foundation:  Options For Reforming America’s Tax Code

TF_Options_for_Reforming_Americas_Tax_CodeTax Foundation, Options For Reforming America’s Tax Code:

There is a widespread consensus among Americans across the political spectrum that the U.S. tax system is overly complex, inefficient, uncompetitive, and due for an overhaul. However, Congress has not passed a comprehensive tax reform bill in three decades. As a result, many lawmakers have set their sights on the 2017 legislative session as an opportunity to hammer out a tax reform deal.

Because so many parts of the U.S. tax code are in need of change, any tax reform bill considered by Congress is likely to be hundreds of pages long and contain dozens of distinct provisions. As a result, lawmakers and voters may be unsure of the effects of each separate tax change on federal revenue collections, the tax burden borne by different groups of Americans, and the growth of the U.S. economy.

To assist lawmakers in assembling tax reform bills over the coming months, and to help the American public in understanding the tax changes being proposed, we have assembled this book: Options for Reforming America’s Tax Code.

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June 9, 2016 in Tax, Think Tank Reports | Permalink | Comments (4)

Merritt:  Lessons For Online Legal Education

Deborah Merritt (Ohio State), Lessons for Online Legal Education:

An increasing number of law schools are creating online courses, certificate offerings, and degree programs. As newcomers to online education, we should look to existing programs for inspiration. One of those is Harvard Business School’s successful CORe program, an online certificate course in business basics. I wrote about CORe’s suitability for law students several weeks ago. Here, I examine three lessons that the program offers to law schools interested in online education.

1.  Evaluate Your Expertise From New Perspectives. ... We tend to think of creating majors, minors, and degree programs. Creating a useful course for students majoring in something else falls outside our typical worldview. Yet this approach is just what online education demands: categorizing our expertise by subject rather than course or degree program; exploring new audiences, again looking outside of traditional concentrations; and finding a match between the two.

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

Thimmesch:  State Taxing Power After Direct Marketing Association v. Brohl

Adam B. Thimmesch (Nebraska), State Taxing Power after Direct Marketing Association v. Brohl, 80 State Tax Notes 299 (Apr. 25, 2016):

The Tenth Circuit Court of Appeals’ recent decision in Direct Marketing Association v. Brohl marked another entry into the ongoing saga regarding the scope of state taxing power over remote vendors. That decision, along with the U.S. Supreme Court’s decision in an earlier iteration of the litigation, has predictably increased the debates regarding the meaning and validity of the Court’s long-standing physical presence rule and the merits of congressional intervention.

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June 9, 2016 in Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 1127

Wednesday, June 8, 2016

Wendi Adelson Discusses Her Ex-Husband Dan Markel's Murder: Transcript And Commentary

AdelsonFollowing up on yesterday's post on Wendi Adelson's discussion of the murder of her ex-husband Dan Markel on the Writing Class Radio Podcast:

David Lat provides a transcript and commentary on Wendi's story and other remarks in:

The Murder Of Dan Markel: Wendi Adelson Speaks (Part 1):

Before we dig into the podcasts, a macro-level observation: I view this as additional evidence that Wendi Adelson did not know about, and was not involved in, the murder of Dan Markel. ... [I]f Wendi knew about or was involved in Dan’s murder and then wrote about it for a class and spoke about it on a podcast, she would have to be stupid, insane, or both. ...

That said, there are aspects of the podcast that some listeners might find chilling or insensitive. And in an interesting twist, Wendi herself at times acknowledges the creepiness factor. The resulting podcast is rich and has so many layers to it; I’ve listened to it about a half-dozen times now. I’m going to discuss some highlights below, but do yourself a favor and listen to the original during your commute or while at the gym. You won’t regret it.

David Lat (Above the Law), The Murder Of Dan Markel: Wendi Adelson Speaks (Part 2):

I am far from a member of “Team Wendi” — in my opinion, she acted abominably in the divorce (more on that later) — but as I’ve written before, I don’t think she was involved in Dan’s murder or had advance knowledge of it (although it’s possible she at some point in the past two years acquired such knowledge)

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

IRS Reopens Transcript Service With More Rigorous e-Authentication, But 70% Of Taxpayers Will Be Unable To Access Their Accounts; TIGTA Identifies Additional 600,000 Taxpayer Victims In Hack Of Prior System

ID TheftFollowing up on my previous posts on security problems with the IRS website (links below):

IR-2016-85, IRS Launches More Rigorous e-Authentication Process and Get Transcript Online (June 7, 2016):

With the assistance of top digital experts at U.S. Digital Service and other security authorities, the Internal Revenue Service today launched a more rigorous e-authentication process for taxpayers that will significantly increase protection against identity thieves impersonating taxpayers to access tax return information through the IRS Get Transcript online service.  This enhanced authentication process will also provide a foundation for additional IRS self-help services in the future.

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June 8, 2016 in IRS News | Permalink | Comments (0)

Johnston:  Who's Getting Richer? Hardly Anyone.

David Cay Johnston (Syracuse), Who's Getting Richer? Hardly Anyone:

The latest federal income data show what looks on the surface like robust economic gains, with Americans reporting 4.6% more income in 2014 than 2013. But that’s misleading.

My analysis of the official data reveals that just beneath the shiny surface lies an ugly picture. A few Americans are seeing their incomes soar, and the top 15% or so are doing well overall. Meanwhile, the vast majority tread water or slowly sink, an economic reality that has fueled support for both Donald Trump and Senator Bernie Sanders.

This disparity, which I have been documenting for more than two decades, reflects government policies that subtly take from the many and redistribute upward to the already very rich few; the downward pressure on wages due to globalization; and the decline of unions, which had given workers bargaining power so they enjoyed a larger share of business revenues.

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June 8, 2016 in Tax | Permalink | Comments (1)

WSJ:  Foreign Students In U.S. Colleges Cheat Five Times More Than Domestic Students

WSJ 3Wall Street Journal, Foreign Students Seen Cheating More Than Domestic Ones:

A flood of foreign undergraduates on America’s campuses is improving the financial health of universities. It also sometimes clashes with a fundamental value of U.S. scholarship: academic integrity.

A Wall Street Journal analysis of data from more than a dozen large U.S. public universities found that in the 2014-15 school year, the schools recorded 5.1 reports of alleged cheating for every 100 international students. They recorded one such report per 100 domestic students.

Students from China were singled out by many faculty members interviewed. “Cheating among Chinese students, especially those with poor language skills, is a huge problem,” said Beth Mitchneck, a University of Arizona professor of geography and development.

In the academic year just ending, 586,208 international undergraduate students attended U.S. colleges and universities, according to the Department of Homeland Security. More than 165,000 were from China. South Korea and Saudi Arabia were the source of nearly 50,000 each and India of about 23,500.

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June 8, 2016 in Legal Education | Permalink | Comments (4)