TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Monday, October 16, 2017

TaxProf Blog Weekend Roundup

Sunday, October 15, 2017

Brunson & Herzig: The Treasury Department Should Create Blacklist Of What Constitutes Prohibited Discrimination By Religious Organizations

Samuel D. Brunson (Loyola-Chicago) & David J. Herzig (Valparaiso), A Diachronic Approach to Bob Jones: Religious Tax Exemptions after Obergefell, 92 Ind. L.J. 1175 (2017):

In Bob Jones v. U.S., the Supreme Court held that an entity may lose its tax exemption if it violates a fundamental public policy, even where religious beliefs demand that violation. In that case, the Court held that racial discrimination violated fundamental public policy. Could the determination to exclude same-sex individuals from marriage or attending a college also be considered a violation of fundamental public policy? There is uncertainty in the answer. In the recent Obergefell v. Hodges case that legalized same-sex marriage, the Court asserted that LGBT individuals are entitled to “equal dignity in the eyes of the law.” Constitutional law scholars, such as Lawrence Tribe, are advocating that faith groups might lose their status, citing that this decision is the dawning of a new era of constitutional doctrine in which fundamental public policy will have a more broad application.

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October 15, 2017 in Scholarship, Tax | Permalink | Comments (1)

Court Uses First Amendment To Reverse Conviction Of Man Who Flipped The Bird At His Pastor During A Sermon

ABA Journal, Man Who Flipped the Bird At His Pastor Gets His Conviction Overturned On First Amendment Grounds:

A churchgoer convicted of disorderly conduct for flipping the bird at his pastor was engaging in speech protected by the First Amendment, according to the Georgia Supreme Court.

The court reversed the conviction of David Justin Freeman in a decision on Monday, the Atlanta Journal-Constitution reports.

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October 15, 2017 in Legal Education, Tax | Permalink | Comments (1)

Zelinsky: The House Appropriations Committee And The Johnson Amendment

Edward Zelinsky (Cardozo), The House Appropriations Committee and the Johnson Amendment:

The Committee on Appropriations of the US House of Representatives, in a so-called rider to the pending federal budget bill, has proposed significant procedural restrictions on the IRS’s ability to enforce the Johnson Amendment. The Johnson Amendment is the provision of the Internal Revenue Code which prevents all tax-exempt institutions (including churches) from participating in political campaigns. The Committee’s budget rider is the most recent salvo in the ongoing dispute about churches and politics.

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October 15, 2017 in Congressional News, Tax | Permalink | Comments (0)

The Top Five New Tax Papers

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 new papers debuting on the list at #3 and #5:

  1. [1,594 Downloads]  Private Benefits in Public Offerings: Tax Receivable Agreements in IPOs,, by Gladriel Shobe (BYU)
  2. [406 Downloads]  Is Efficiency Biased?, by Zachary Liscow (Yale)
  3. [244 Downloads]  Background and Current Status of FATCA and CRS, by William Byrnes (Texas A&M)
  4. [230 Downloads]  The Rise of Trust Decanting in the United States, by Robert Sitkoff (Harvard)
  5. [208 Downloads]  Rejecting Charity: Why the IRS Denies Tax Exemption to 501(C)(3) Applicants, by Terri Lynn Helge (Texas A&M)

October 15, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, October 14, 2017

This Week's Ten Most Popular TaxProf Blog Posts

IMF: Higher Taxes On The Rich Will Reduce Inequality Without Hurting Economic Growth

IMF Fiscal Monitor, Tackling Inequality, October 2017:

Rising inequality and slow economic growth in many countries have focused attention on policies to support inclusive growth. While some inequality is inevitable in a market-based economic system, excessive inequality can erode social cohesion, lead to political polarization, and ultimately lower economic growth. This Fiscal Monitor discusses how fiscal policies can help achieve redistributive objectives. It focuses on three salient policy debates: tax rates at the top of the income distribution, the introduction of a universal basic income, and the role of public spending on education and health.

IMF 1

New York Times, I.M.F. Cautions Against Tax Cuts for Wealthy as Republicans Consider Them:

The International Monetary Fund delivered a blunt warning to international policy makers ahead of the fund’s annual meeting this week: Governments risk undermining global economic growth by cutting taxes on the wealthy.

The message, while aimed broadly at all developed nations, carries particular resonance in the United States as the Trump administration and Republican lawmakers push a tax plan that critics say will exacerbate income inequality by reducing taxes for the richest Americans. ...

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October 14, 2017 in Gov't Reports, Tax | Permalink | Comments (4)

Lesson From Tax Court: The Downside of Easy Tax Exemption Approval

These would seem to be fat times for organizations that want tax-exempt status. As everyone and their little dog seems to know, Service resource constraints have made recognition as a tax-exempt organization “virtually automatic” for most applicants on the front end. Even the National Taxpayer Advocate complained that it was too easy for organizations to obtain approval.

This week’s lesson from the Tax Court is that the upside of easy approval on the front end may carry a significant downside on the back end. In the reviewed opinion Creditguard of America, Inc. v. Commissioner, 149 T.C. No. 17, Judge Lauber expressed the Tax Court’s opinion that when the Service revokes an organization’s tax exempt status retroactive to a given year, interest starts running from that retroactive year’s return due date, and not just from the date when the Service made its determination to revoke or actually assessed the tax liability. Why is this such a downside? Because the very resource constraints that make for easy application approval on the front end also create significant delays in completing examinations on the back end. In the Creditguard case, the examined year was 2002, the audit was opened in 2003, completed in 2012 and the resulting deficiency assessed in 2013. And now it’s 2017. That’s a lotta interest. More below the fold.

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October 14, 2017 in Bryan Camp, New Cases, Tax | Permalink | Comments (0)

The Smartest Americans Are Heading West

Bloomberg, The Smartest Americans Are Heading West:

Bloomberg 1

Three cities in Colorado — a state whose fortunes have been tied to the boom and bust of oil, gas and other commodities — are among the top 10 leading destinations for the nation’s best and brightest as old cow and mining towns morph into technology hubs, according to data compiled by Bloomberg. ... Filling out the top 10 of the Brain Concentration Index are cities rich in technology and higher education, including San Francisco (2), Washington (5), Raleigh (6) and Seattle (9).

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October 14, 2017 in Tax | Permalink | Comments (4)

Anne-Marie Rhodes Named John J. Waldron Professor Of Law At Loyola-Chicago

RhodesRhodes Named John J. Waldron Professor of Law:

Loyola University Chicago School of Law is pleased to announce the appointment of Professor Anne-Marie Rhodes as the John J. Waldron Professor of Law.  Rhodes has been a member of Loyola’s full-time law faculty since 1980.  She teaches courses in estate-and-gift tax, income tax, estate planning, trusts and estates, art law, and comparative law, and is a frequent presenter and is widely published in these areas. Her book Fundamentals of Federal Estate, Gift, and Generation-Skipping Taxes (West Academic) was published this year.  Her casebook Art Law & Transactions (Carolina Academic Press) was published in 2011.

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October 14, 2017 | Permalink | Comments (0)

Friday, October 13, 2017

Weekly SSRN Tax Article Review And Roundup

This week, Sloan Speck (Colorado) reviews a new work by Tsilly Dagan (Bar Ilan University), The Future of Corporate Residency.

Speck (2017)Grim. That, in a word, is Tsilly Dagan’s conclusion in her compelling paper, The Future of Corporate Residency. Although Dagan’s position may not surprise many, the route she takes reveals much about the current—and perhaps future—state of international taxation. Dagan begins at the beginning, tracing multinational corporations as legal constructs from the East India Company to the advent of general incorporation statutes in the second half of the nineteenth century. After a brief discussion of the rise and fall of benefits theories of taxation, Dagan exposits a revival in de facto benefits taxation, at least among multinational corporations. Two factors drive this revival: the “marketization” of corporate residence, in which jurisdictions compete for multinationals’ presence, and the “fragmentation” of the state-derived benefits of incorporation, in which multinationals divide their presence among multiple jurisdictions to create “mix-and-match” legal regimes. Dagan is skeptical that cooperation can overcome marketization and fragmentation. Furthermore, Dagan notes that cooperation may be undesirable, if it entails efficiency losses and disadvantages developing countries.

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October 13, 2017 in Scholarship, Tax | Permalink | Comments (0)

Tax Policy In The Trump Administration

Weekly Legal Education Roundup

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October 13, 2017 in Legal Education, Weekly Legal Education Roundup | Permalink | Comments (0)

Camp: FDR And The Forgotten History Of The Earned Income Tax Credit

FDRBryan Camp (Texas Tech), Franklin Roosevelt and the Forgotten History of the Earned Income Tax Credit, 20 Green Bag 2d 337 (2017):

On his 1934 income tax return, Franklin Roosevelt claimed an "earned income credit" of $1,400. We usually think of the Earned Income Tax Credit (ETIC) as a subsidy for the poor. This article recovers the original history of the credit back when it was a subsidy for the rich, or at least wealthy taxpayers who earned their wealth through their labor. The purpose of this credit, which lasted up until WWII, was to offset the huge tax preference given to wealthy taxpayers whose income came from capital.

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October 13, 2017 in Scholarship, Tax | Permalink | Comments (0)

Michigan Hosts International Tax Law Conference Today On Perspectives On The Multilateral Instrument

Michigan Law Logo (2015)Michigan hosts an International Tax Law Conference today on  Perspectives on the Multilateral Instrument:

Join tax specialists and international law experts from universities, private practice, and global institutions as they explore the impact of the recently signed Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). The MLI, which has been signed by almost 70 jurisdictions, will modify many existing bilateral tax treaties by introducing anti-tax avoidance measures.

Pasquale Pistone (IBFD), Dispute Settlement under the MLI and the EU Arbitration Convention
Commentator: Kim Brooks (Dalhousie)

Richard Reinhold (Willkie Farr), Article 7 and Prevention of Treaty Abuse
Commentator: Reuven Avi‐Yonah

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October 13, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Kahng: Who Owns Human Capital?

Lily Kahng (Seattle), Who Owns Human Capital?, 94 Wash. U. L. Rev. 607 (2017):

This Article analyzes the tax law’s capital income preference through the lens of intellectual capital, an increasingly important driver of economic productivity whose value derives primarily from workers’ knowledge, experience and skills. The Article discusses how business owners increasingly are able to “propertize” labor into intellectual capital — to control their workers and appropriate the returns on their labor through the expansive use of intellectual property laws, contract and employment laws, and other legal mechanisms. The Article then shows how the tax law provides significant subsidies to the process of propertization and thereby contributes to the inequitable distribution of returns between business owners and workers.

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October 13, 2017 in Scholarship, Tax | Permalink | Comments (1)

Camp: Equitable Principles And Jurisdictional Time Periods

Bryan Camp (Texas Tech), Equitable Principles and Jurisdictional Time Periods, Part 1, 156 Tax Notes 1397 (Sept. 11, 2017):

Like other federal courts, the Tax Court is very, very cautious about not overstepping its Congressionally-given bounds. However, the Tax Court also strives to allow taxpayers their day in Court. These two impulses — the caution to stay within the statutory grants of power and the drive to decide cases on the merits — sometimes collide. When that happens, the Tax Court struggles in applying the relevant limitation period and, as a result, sometimes lies or cheats. It sometimes lies by claiming that it may not apply equitable principles to the relevant limitation period. It sometimes cheats by accomplishing the same result by manipulating facts to bring a case within the relevant time period. It sometimes does both at the same time.

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October 13, 2017 in Scholarship, Tax | Permalink | Comments (0)

Effect Of Tax Subsidies To Fossil Fuel Companies On U.S. Crude Oil Production

Peter Erickson (Stockholm Environment Institute), Adrian Down (Stockholm Environment Institute), Michael Lazarus (Stockholm Environment Institute) & Doug Koplow (Earth Track), Effect of Subsidies to Fossil Fuel Companies on United States Crude Oil Production:

Countries in the G20 have committed to phase out ‘inefficient’ fossil fuel subsidies. However, there remains a limited understanding of how subsidy removal would affect fossil fuel investment returns and production, particularly for subsidies to producers. Here, we assess the impact of major federal and state subsidies on US crude oil producers. We find that, at recent oil prices of US$50 per barrel, tax preferences and other subsidies push nearly half of new, yet-to-be-developed oil investments into profitability, potentially increasing US oil production by 17 billion barrels over the next few decades. This oil, equivalent to 6 billion tonnes of CO2, could make up as much as 20% of US oil production through 2050 under a carbon budget aimed at limiting warming to 2 °C. Our findings show that removal of tax incentives and other fossil fuel support policies could both fulfil G20 commitments and yield climate benefits.

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October 13, 2017 in Scholarship, Tax | Permalink | Comments (0)

Thursday, October 12, 2017

Virginia Tax Review Publishes New Issue

Virginia Tax Review (2016)The Virginia Tax Review has published Vol. 36, No. 2 (Summer 2017):

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October 12, 2017 in Scholarship, Tax | Permalink | Comments (0)

Law Firms Continue To Cling To Desktops In Age Of Tablets And Laptops

Legal Tech News, Desktop's Not Dead: Law Firms Continue to Use Desktops for Security, Upkeep Concerns:

Amid all the slick tech hardware on the market today, desktop computers perhaps seem like a relic of an ancient past. They're bulky, arguably unattractive and chained to one specific location — the name literally points to its permanent fixture on a desk top. And yet, 45 percent of all law firms plan to equip attorneys with desktop computers in their 2017 hardware refresh.

In the modern legal workplace, where attorneys are expected to be reachable at any given hour of the day, it may seem counterintuitive for law firms to invest too heavily in desktop technology. Law firms have taken significant steps towards embracing the kind of mobility and flexibility needed to stay available to clients at any time of the day. In the last decade, laptops and tablets began to outstrip desktop computers in law firm purchasing. Aiding in the matter, law firms have widely adopted cloud-based data hosting, enabling attorneys to work remotely and collaboratively.

Yet in a few key ways, desktop computers still play an integral role in law firms' technology strategies. Desktop computers are still potentially the most secure, reliable and cheaply maintained option for many law firms.

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October 12, 2017 | Permalink | Comments (0)

Soled & Alm: W(h)ither The Tax Gap?

Jay A. Soled (Rutgers) & James Alm (Tulane), W(h)ither the Tax Gap?:, 92 Wash. L. Rev. 521 (2017):

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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October 12, 2017 in Scholarship, Tax | Permalink | Comments (0)

600 Friends Celebrate Charles Ogletree's Life As He Battles Alzheimer’s

Following up on my previous post, Charles Ogletree Sees 'Blessing' In Alzheimer’s Diagnosis At Age 63:  Harvard Law Today:  Honoring Charles Ogletree: 600 Colleagues, Former Students, Friends Gather to Celebrate Life and Legacy of Influential Law Professor:

It felt like a family reunion — with 600 relatives.

That many friends, former students, colleagues, and well-wishers gathered Oct. 2 in a joyful celebration of the life and career of Harvard Law Professor Charles Ogletree, advocate for Civil Rights, author of books on race and justice, and mentor to former President Barack Obama and first lady Michelle Obama.

Last year, Ogletree ’78, the Jesse Climenko Professor of Law and founding and executive director of the Charles Hamilton Houston Institute for Race & Justice, revealed he had been diagnosed with Alzheimer’s disease.

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October 12, 2017 in Legal Education | Permalink | Comments (1)

McCormack: Postpartum Taxation And The Squeezed Out Mom

Shannon Weeks McCormack (University of Washington), Postpartum Taxation and the Squeezed Out Mom, 105 Geo. L.J. 1323 (2017):

Faced with too-short (or nonexistent) maternity leaves, inflexible work schedules, and the soaring costs of childcare in the United States, many new mothers temporarily leave the workforce to care for their young children. Although media attention has focused on the “opt-out” mom, many more mothers are squeezed out of the external workplace. But mothers that try to return to work may discover that it is difficult to do so, as employers have been shown to be less likely to hire mothers than others. A mother that does reenter may find that even short periods out of work cost (sometimes far) more than the income foregone during her intended time out and may result in a reduction in her overall earning potential, retirement, disability, and Medicare benefits. This may contribute to severe economic hardships among divorced mothers and their children, the underrepresentation of women in high-level leadership positions, and a wage gap between mothers and others, to name a few problems.

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October 12, 2017 in Scholarship, Tax | Permalink | Comments (4)

ABA Legal Ed Committee Proposes Changes To Accreditation Standard On Law School Admissions Tests

ABA Section On Legal Education (2016)ABA Journal, ABA Legal Ed Committee Suggests Changes to Rule on Law School Admissions Tests:

After recent announcements from various law schools that they will accept the GRE from applicants in addition to the LSAT, an American Bar Association section committee recently made various accreditation standard recommendations, including doing away with the separate admissions test rule entirely.

In March, the council of the ABA’s Section of Legal Education and Admissions to the Bar sought notice and comment for a proposed revision to Standard 503 — which covers admission tests — that called for the council to establish a process that determines the reliability and validity of other tests besides the LSAT. That’s a change from the current version, which directs law schools using alternate admissions tests to demonstrate that the exams are valid and reliable.

The section’s Standards Review Committee — which met Friday and Saturday in Boston —recommends that the council reject the earlier proposal, and consider three options:

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October 12, 2017 in Legal Education | Permalink | Comments (9)

Doran: Uncapping Executive Pay

Michael Doran (Virginia), Uncapping Executive Pay, 90 S. Cal. L. Rev. 815 (2017) (reviewed here):

This article sets out the case for repealing the $1 million tax cap on executive pay. The cap is easily avoided and, when not avoided, widely ignored. Since enactment in 1993, the cap has had little effect in reducing executive pay or in linking pay to performance. Even worse, the cap increases corporate tax liabilities — liabilities that likely burden workers and investors. In effect, the cap punishes rank-and-file employees and shareholders for pay deals made by directors and executives. This article demonstrates why prominent reform proposals would be ineffective and counterproductive. It then devises a novel reform approach — a confiscatory tax on excessive executive pay — that would limit executive pay without burdening workers or investors.

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October 12, 2017 in Scholarship, Tax | Permalink | Comments (1)

Avi-Yonah: The Structural Problems Of The Tax Reform Framework

Trump Tax ReformReuven S. Avi-Yonah (Michigan), Slicing and Dicing: The Structural Problems of the Tax Reform Framework:

The Unified Framework for Fixing Our Broken Tax Code (the “Framework”) released by the “Big Six” group of Treasury, White House and Congressional leaders on September 27 has been the focus of a lot of commentary. Most of the comments have focused on the distributive aspects of the plan and on the proposed rate structure, as well as the impact on revenues and the federal deficit.

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October 12, 2017 in Scholarship, Tax | Permalink | Comments (0)

Wednesday, October 11, 2017

Marian Presents Is All Corporate Tax Planning Good For Shareholders? Today At Penn

Marian (2016)Omri Marian (UC-Irvine) presents Is All Corporate Tax Planning Good for Shareholders at Pennsylvania today as part of its Tax Policy Workshop Series hosted by Chris Sanchirico and Reed Shuldiner:

Multiple commentators argue that corporate managers have an affirmative duty to engage in corporate tax planning. Underlying this argument is the assumption that reduced corporate tax liability enhances shareholder value. In this article, I explain that this common perception is frequently incorrect. Corporate tax reduction schemes may increase the overall tax burden on shareholders. I make the following descriptive arguments in this regard:

First, I show that in many cases, successful (and legal) corporate tax planning schemes are not Pareto-optimal to shareholders. Some classes of shareholders (generally, tax-exempt shareholders) may see a net benefit, while other shareholders (usually taxable shareholders) experience a net loss. Second, I show that in certain instances it is reasonable to expect that legal corporate tax planning schemes will be overall inefficient. Meaning, the losses to taxable shareholders may exceed the gains to tax-exempt shareholders. Lastly, I show that because of an underappreciated agency problem, shareholders approve inefficient corporate tax plans, even when information about the potential detriment is freely available.

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October 11, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Cockfield Presents What's International Tax Law Got To Do With It? Today At Toronto

Cockfield (2016)Arthur Cockfield (Queen's) presents What's International Tax Law Got to do With It? at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series:

The OECD and G20 Base Erosion and Profits (BEPS) project represents the greatest multilateral cooperative effort to date to inhibit aggressive international tax planning and offshore tax evasion. While accepting that cooperation is normally helpful, the Article explores some of the theoretical and practical limits to international tax cooperation along with the potential for unilateral tax reform to confront pressing challenges.

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October 11, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Stanford Symposium: Lawyers And Leadership

Stanford 2

Symposium, Raising the Bar: Lawyers and Leadership, 69 Stan. L. Rev. 1593-1853 (2017):

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October 11, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (1)

How The Trump Tax Plan Affects Working Families

Two weeks after the release of their tax reform blueprint, the Trump administration and congressional Republican leaders still haven't said how much their plan would raise the child tax credit or how they would treat head-of-household filers. In the meantime, Kyle Rozema (Chicago) and I have tried to estimate the change in net tax liability under the Trump plan for working families (adjusted gross income of $75,000 or less) under a number of plausible scenarios.

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October 11, 2017 in Tax, Tax Policy in the Trump Administration | Permalink | Comments (4)

The Tax Lawyer Publishes New Issue

The Tax Lawyer (2013)The Tax Lawyer has published Vol. 70, No. 4 (Summer 2017) (State and Local Tax Edition):

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October 11, 2017 in ABA Tax Section, Scholarship, Tax | Permalink | Comments (0)

Summers: Trump's Tax Plan Is An Atrocity

Washington Post op-ed:  The Trump Administration’s Tax Plan Is An Atrocity, by Lawrence Summers:

The Trump administration’s tax plan is not a plan. It is a melange of ideas put forth without precision or arithmetic. It is not clear enough to permit the kind of careful quantitative analysis of its expected budget costs, economic effects and distributional implications that precedes such legislation in a serious country.

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October 11, 2017 in Tax, Tax Policy in the Trump Administration | Permalink | Comments (1)

Advice To Law Students Seeking Letters Of Recommendation

Bridget Crawford (Pace) reprinted the great advice from Chris Walker (Ohio State) to law students seeking letters of recommendation:

1. When reaching out, please include resume, transcript, and talking points.
2. Talking points should tell me what you want me to cover substantively and bonus points if in a format I could cut and paste into letter.
3. Talking points are even better if they situate my letter within the context of any other letters, personal statement, etc.
4. Talking points should include as much detail of our substantive interactions as possible, as that detail really makes the letter.
5. Don't assume I'll remember the highlights of our interactions. Remind me. Even when I do remember, your framing is often much better.

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October 11, 2017 in Legal Education | Permalink | Comments (6)

Johnson: A Conceptual Framework For Capital Gain

Florida Tax Review  (2015)Calvin H. Johnson (Texas), A Conceptual Framework for Capital Gain, 20 Fla. Tax Rev. 664 (2017):

Qualification for preferential tax rates on capital gain is “fuzzy at best and incoherent at worst.” The primary governing statute provides that sale or exchange of “property” yields capital gain, with only narrow exceptions. Under traditional understanding, however, capital gain does not include income, including rent, interest, compensation, and periodic business income, even though such income is received on the sale of something reasonably considered to be “property” in nontax contexts. A conceptual framework is needed that brings both courts and congressional rules into consistency and produces principled results; this Article presents such a framework.

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October 11, 2017 in Scholarship, Tax | Permalink | Comments (1)

Tuesday, October 10, 2017

Greene Presents Welfare Reform, Consumer Credit, And Inequality Today At Columbia

GreeneSara Sternberg Greene (Duke) presents The Bootstrap Trap: Welfare Reform, Consumer Credit, and Inequality, 67 Duke L. J. (2017) at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium Series hosted by Alex Raskolnikov and Wojciech Kopczuk:

In the mid-1990s, Congress fundamentally altered the public safety net when it passed the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, otherwise known as welfare reform. Under the PRWORA, cash assistance was no longer an entitlement for income-qualifying families; instead, recipients faced work requirements and lifetime limits on receiving benefits. Bipartisan reformers sought to transform welfare from a program believed to trap poor mothers in a “culture of dependence” into a program that would promote a culture of “self-sufficiency” and “personal responsibility.” This shift in culture, it was argued, would ultimately lead to upward mobility. This Article shows how, ironically, over twenty years after welfare reform, the private safety net that many struggling families rely on — the credit system — disincentivizes the very self-sufficient behavior that welfare reformers had hoped to promote.

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October 10, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Mason Presents Are Tax Rulings Selective? Today At Boston College

Mason (2016)Ruth Mason (Virginia) presents State Aid Special Report – Part 6: Are Tax Rulings Selective? at Boston College today as part of its Tax Policy Workshop Series hosted by Jim Repetti, Diane Ring, and Shu Yi Oei:

The scope of EU state-aid enforcement in the tax area is unpredictable.  Lawyers in Europe worry that tax policies as quotidian as participation exemption and as central as territoriality may constitute state aid.  This legal uncertainty arises in part because the Commission uses the state-aid rules to pursue a number of conflicting values, and it does not always specify clearly in each case what value it pursues. The goals of state-aid control ought to be more clearly articulated, and the Commission’s enforcement actions should be limited by those goals.  Such limitations could be self-imposed by the Commission, using clearer published guidance and more explicit reasoning in decisions, or such limitations could from the EU courts via judicial review of the Commission’s state-aid decisions.  

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October 10, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

WSJ: Our Smartphones Are Making Us Dumber — Even When They Are Turned Off

IPhone XWall Street Journal, How Smartphones Hijack Our Minds: Research Suggests That as the Brain Grows Dependent on Phone Technology, the Intellect Weakens:

So you bought that new iPhone. If you are like the typical owner, you’ll be pulling your phone out and using it some 80 times a day, according to data Apple collects. That means you’ll be consulting the glossy little rectangle nearly 30,000 times over the coming year. Your new phone, like your old one, will become your constant companion and trusty factotum — your teacher, secretary, confessor, guru. The two of you will be inseparable.

The smartphone is unique in the annals of personal technology. We keep the gadget within reach more or less around the clock, and we use it in countless ways, consulting its apps and checking its messages and heeding its alerts scores of times a day. The smartphone has become a repository of the self, recording and dispensing the words, sounds and images that define what we think, what we experience and who we are. In a 2015 Gallup survey, more than half of iPhone owners said that they couldn’t imagine life without the device.

We love our phones for good reasons. It’s hard to imagine another product that has provided so many useful functions in such a handy form. But while our phones offer convenience and diversion, they also breed anxiety. Their extraordinary usefulness gives them an unprecedented hold on our attention and vast influence over our thinking and behavior. So what happens to our minds when we allow a single tool such dominion over our perception and cognition?

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October 10, 2017 in Legal Education | Permalink | Comments (1)

FBA Tax Law Student Writing Competition

FBA

The Federal Bar Association Section on Taxation invites J.D. and LL.M. students to participate in the 2017 Donald C. Alexander Tax Law Writing Competition:

The Federal Bar Association Section on Taxation is once again sponsoring an annual writing competition and invites law students to participate. The Donald C. Alexander Tax Law Writing Competition is named in honor of former IRS Commissioner (1973-1977) Don Alexander, who passed away in 2010. Mr. Alexander was a widely admired role model and advocate for writing skills and style in the area of tax law throughout his career.

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October 10, 2017 in Legal Education, Tax, Teaching | Permalink | Comments (0)

Protesters Force Cancellation Of Speech By State Representative At Federalist Society Event At Thurgood Marshall Law School

Thurgood Marshall LogoFollowing up on yesterday's post, Seattle Law School Is Latest Flashpoint Over Campus Speech; Petition Seeks Cancellation Of Immigration Debate Sponsored By Federalist Society:  KHOU, Protesters at TSU Prevent State Representative's Speech:

There was controversy on the Texas Southern University campus right before the cancellation of one lawmaker’s speech Monday.

After dozens of protesters filed into an event featuring House Representative Briscoe Cain, they wouldn’t allow Rep. Cain to speak, claiming he has ties to the Alt-Right and is anti-LGBT.

Rep. Cain was invited to the Thurgood Marshall School of Law by the Federalist Society to talk to the students about the recent legislative special session. Instead, the event was shut down before it even started. 

“No hate anywhere, you don’t get a platform here!" protesters yelled inside the room.

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October 10, 2017 in Legal Education | Permalink | Comments (8)

Camp: Misapplication Of The Anti-Injunction Act In Chamber Of Commerce v. IRS

Camp (2017)TaxProf Blog op-ed:  Misapplication Of The Anti-Injunction Act In Chamber Of Commerce v. IRS, by Bryan Camp (Texas Tech):

This is a follow-up to some good blogs on a recent decision by the District Court for the Western District of Texas in Chamber of Commerce v. IRS. See these posts by Professors Les Book, Kristin Hickman, Daniel Hemel and Andy Grewal. All are worth reading.

The more I think about this opinion, the more convinced I am that the court misapplied the Anti-Injunction Act. What I want to point out in this post is what I see as a logical disconnect between the court’s ruling on standing and its ruling on the Anti-Injunction Act. My contention is that the court’s rationale for finding standing necessarily poisons the plaintiffs’ ability to avoid the Anti-Injunction Act. In brief, I just don’t think the plaintiffs here can have it both ways. If they have standing because the disliked regulation will hurt them by potentially increasing their taxes, the Anti-Injunction Act applies. But if, in order to avoid §7421, they claim that striking down the disliked regulation will have no effect on the assessment or collection of taxes from them (or anyone else) then they lose standing.

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October 10, 2017 in New Cases, Tax | Permalink | Comments (1)

Artificial Intelligence And Its Implications For Lawyers And Law Schools

Robot Lawyer 2David Barnhizer (Cleveland State), Artificial Intelligence and Its Implications for Lawyers and Law Schools:

Billionaire investor Warren Buffett recently stated that capitalism inevitably cuts jobs in its quest for greater efficiency, productivity and profit.  That is what he says is going on with AI/robotics.  While lamenting this dynamic, Buffett did go as far as saying that government needed to develop strategies to help the “Roadkill” represented by workers pushed out of jobs that will not be recreated. If we accept the dismal placement figures for recent law school graduates, far too many are “Roadkill”, both because they find out on graduating that there is no place to go for work of the kind they anticipated, or any kind related to law, and because they are burdened by massive debt with little hope of being able to repay that obligation.

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October 10, 2017 in Legal Education | Permalink | Comments (0)

Treasury Rolls Back Eight Tax Regulations

TreasuryTreasury Department, Second Report to the President on Identifying and Reducing Tax Regulatory Burdens (Executive Order 13789) (Oct. 2, 2017) (press release):

This Second Report recommends actions to eliminate, and in other cases mitigate, consistent with law, the burdens imposed on taxpayers by eight regulations that the Department of the Treasury (Treasury) has identified for review under Executive Order 13789. As stated in the order, it is the policy of the President that tax regulations provide clarity and useful guidance. Recent regulations, however, have increased tax burdens and impeded economic growth. The order therefore calls for immediate action to reduce tax regulatory burdens and provide useful and simplified tax guidance.

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October 10, 2017 in Gov't Reports, IRS News, Tax | Permalink | Comments (3)

Monday, October 9, 2017

Liscow Presents Is Efficiency Biased? Today At Loyola-L.A.

Liscow (2017)Zachary Liscow (Yale) presents Is Efficiency Biased? at Loyola-L.A. today as part of its Tax Policy Colloquium Series hosted by Katie Pratt and Ted Seto:

The most common underpinning of economic analysis of the law has long been the goal of efficiency (i.e., choosing policies that maximize people’s willingness to pay), as reflected in economic analysis of administrative rulemaking, judicial rules, and proposed legislation. Current thinking is divided on the question whether efficient policies are biased against the poor, which is remarkable given the question’s fundamental nature. Some say yes; others, no.

I show that both views are supportable and that the correct answer depends upon the political and economic context and upon the definition of neutrality.

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October 9, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Leiter: What In The World Is Going On At Emory Law School?

Emory LogoBrian Leiter (Chicago), What in the World Is Going On at Emory Law School?:

I've been hearing about the turmoil at Emory Law from both insiders and colleagues elsewhere, who have also heard from insiders. Here's what seems absolutely clear at this point:

1.  Prof. Robert Schapiro announced last March he would not seek another term as Dean.

2.  Disregarding faculty input, the central administration (itself in transition) appointed an alum, a retired partner from Alston & Bird, as the Interim Dean.

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October 9, 2017 in Legal Education | Permalink | Comments (0)

ABA Tax Section Chair Explains Reduced Travel Support For Academics

ABA Tax Section (2017)Following up on my previous posts:

To:      ABA Taxation Section Teaching Taxation Committee members
From: Karen L. Hawkins, Chair, Taxation Section
Re:     Reimbursement for Academic leaders and speakers

As all of you are aware by now, during the business meeting of the Taxation Section Council, difficult financial decisions were made. These types of difficult belt-tightening decisions have had to be made over the past two years, and will continue to be required to reach, and maintain, a revenue neutral budget. If the Section is to maintain its stated commitments to provide services to its membership; tax assistance to vulnerable taxpayers; and leadership in support of a workable tax system, it is imperative that we continue to cut expenses while also seeking additional ways to increase income.

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October 9, 2017 in ABA Tax Section, Legal Education, Tax | Permalink | Comments (0)

Seattle Law School Is Latest Flashpoint Over Campus Speech; Petition Seeks Cancellation Of Immigration Debate Sponsored By Federalist Society

Seattle

Bloomberg Law, Seattle Law School Latest Flashpoint Over Campus Speech:

An immigration debate at Seattle University School of Law is the latest front for the hot-button issue of campus speech rights. ...

At Seattle University’s law school, a Change.org petition purportedly signed by over 200 individuals is asking the school to cancel the Oct. 16 debate, which is being hosted by the school’s Federalist Society chapter.

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October 9, 2017 in Legal Education | Permalink | Comments (15)

Which Law School Will Become The Mayo Clinic Of Legal Education Via The Dean And Faculty's Use Of Social Media?

Mayo 3Kevin O’Keefe (CEO & Founder, LexBlog), Law Schools Need To Introduce Social Learning:

Little question that some law school students are using social media and blogging to build a name for themselves. ... But how many law students are blogging and using social media for learning? How many law professors and law schools are promoting its use for learning?

Sadly, not many — and that’s a loss for the students, as well possible malfeasance on a law school’s part for failing to do so.

ZDNet’s Dion Hinchcliffe recently reported that though technology has long been used to improve how we learn, today’s digital advances, particularly with social media, have taken learning in a powerful new direction:

[The digitization of learning] allows learning — for better or worse, depending on the critic — to be far more situational, on-demand, self-directed, infinitely customized, even outright enjoyable, depending on the user experience, all of which leads to more profound engagement of learners.

In addition, the rise of social networking technology has allowed people with similar learning interests to come together as a group to share knowledge on a subject — and perhaps even more significantly — to express their passion for an area of learning. This can create deeper, more intense, and more immersive educational experiences within a community of like-minded learners. ...

“Social learning” is more than theory, the use of digital platforms and social networks to bring together communities has proven to work. ... Hinchcliffe suggests organizations lay a foundation for social learning. In the case of law schools, a foundation means creating a positive environment for social media and blogging.

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October 9, 2017 in Legal Education | Permalink | Comments (0)

Lesson From The Tax Court: What Is 'Away From Home'?

Tax Court (2017)It takes money to make money. I use that adage to teach my students the basic idea behind the §162 deduction: the money it takes to make money should be deductible from the money made.  On October 2, 2017 the Tax Court decided the case of John S. Barrett and Maria T. Barrett v. Commissioner, T.C. Memo 2017-195. The case illustrates a common problem with that adage: how to know when the costs of traveling away from home are deductible business expenses under §162.

Section 162 allows a deduction for “traveling expenses...while away from home in the pursuit of a trade or business.” In contrast, §262 denies deductions for “personal, living or family expenses.” So that is the tension: is an expense business or personal? The more a taxpayer can connect expenses to business needs and away from personal preferences, the more likely the taxpayer can deduct those expenses.

Travel expenses that are more closely connected to taxpayer’s personal preferences are called “commuting” costs and are not deductible. The idea is that everyone has to live somewhere. And our personal choice of where to live should not allow us a deduction in the cost of going to work. That is the idea of your “tax home.” However, expenses for travel away from the “tax home” that are incurred because of business needs, and so duplicate otherwise personal living expenses, are deductible. The IRS has a really good explanation of this distinction in Rev. Rul. 99-7. The classic case on the subject is Commissioner v. Flowers, 326 U.S. 465 (1946), where the Court held that when a taxpayer’s job moved to a different city, his choice to continue living in the old city and travel 165 miles to the new job was a personal choice. His “tax home” was the new city where his employer required him to work. So his choice to remain in the old city just created a long commute.

On the surface, the Barrett case looks like Flowers. In Barrett, the married taxpayers liven in Las Vegas. For some 20 years Mr. Barrett had a business of providing video recording to one client: the American Israel Public Affairs Committee (AIPAC) and did so using a studio in Las Vegas. But when AIPAC built a new building in Washington D.C., it built its own video recording and production studio. So now instead of travelling across town, Mr. Barrett had to travel to D.C. each year, spending two or more months either in hotels or in a rented condo. The issue was whether Mr. Barrett’s expenses of travel, lodging, and meals were deductible under §162. The IRS thought Mr. Barrett just had a long commute, that his “tax home” was now Washington D.C. The Tax Court disagreed. 

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October 9, 2017 in Bryan Camp, New Cases, Tax | Permalink | Comments (0)

L.A. Times Editorial: Lower The Cut Score To Increase Diversity Of The Bar

California Bar ExamLos Angeles Times editorial:  Ease Up on California's Bar Exam to Achieve More Diversity Among Lawyers:

California’s bar exam is notoriously difficult. Or, more to the point, it’s notoriously difficult to pass, which is not quite the same thing. The questions that prospective lawyers must answer aren’t necessarily harder here than those on other states’ exams, but the grading is tougher. It’s as if you only have to get a C+ to be an attorney in Illinois, but you need an A- in California. Fewer than half the would-be lawyers who took the test here in the last three years passed it.

That might be OK if it meant that California’s attorneys were more competent, and the public better protected against poor lawyering, than in other states. But there is no evidence to support any such contention. The pass rate, as set by the state, is relatively arbitrary.

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October 9, 2017 in Legal Education | Permalink | Comments (6)

TaxProf Blog Weekend Roundup