TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Tuesday, October 25, 2016

Soled & Thomas:  Regulating Tax Return Preparation

Jay A. Soled (Rutgers) & Kathleen DeLaney Thomas (North Carolina), Regulating Tax Return Preparation, 58 B.C. L. Rev. ___ (2016):

Every year the U.S. government collects nearly $3 trillion of income and employment taxes, a large share of which is used to deliver social welfare benefits to the poor. With respect to these collections and deliveries, the Form 1040 (U.S. Individual Income Tax Return) seeks to ensure taxpayer accuracy. In the twenty-first century, there are two sets of key players that dominate the Form 1040 preparation and submission process, namely, tax return preparers and tax return preparation software companies. The former hand-hold taxpayers through the entire tax return preparation and submission process while the latter provide taxpayers with the necessary tools to complete and submit tax returns on their own. These two groups – tax return preparers and tax software companies – thus stand as vital intermediaries between the government and taxpayers, assisting in the preparation of over 90 percent of all individual tax returns.

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October 25, 2016 in Scholarship, Tax | Permalink | Comments (4)

Santa Clara Welcomes 246 1Ls, Down 5% From 2015 (But Up 62% From 2014)

Santa Clara Law School (2016)Santa Clara Law School (ranked #129 in U.S. News) welcomed 246 1Ls this Fall, down 5% from 2015 (260) and down 22% from 2010 (314), but up 62% from 2014 (152). Here are Santa Clara's 25%/50%/75% LSAT scores for those years:

  • 2010 class of 314:  158/160/162
  • 2014 class of 152:  156/157/160
  • 2015 class of 260:  153/155/157
  • 2016 class of 246:  151/154/157 

Here are Santa Clara's admission data for the prior six years from Law School Transparency:

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October 25, 2016 in Legal Education | Permalink | Comments (9)

Chicago Tax Lawyer Reaps $30 Million From 900 Whistleblower Lawsuits Against Internet Retailers For Failing To Collect State Taxes On Purchased Goods

ABA Journal, Chicago Lawyer Has Filed More Than 900 Qui Tam Actions Against Internet Retailers:

Chicago lawyer Stephen Diamond has made a business out of filing qui tam cases accusing internet retailers of failing to pay correct taxes to the state of Illinois.

Diamond and his law firm have filed more than 900 qui tam cases in Cook County, Illinois, courts and obtained nearly $30 million in settlements over a 15-year period, Bloomberg Big Law Business reports. Diamond’s share of the proceeds is $11.6 million, which includes his share of the settlements, attorney fees and costs. ...

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October 25, 2016 in Tax | Permalink | Comments (2)

The Dan Markel Murder Investigation: Why Was Katherine Magbanua's First Degree Murder Charge Reduced To Second Degree Murder?

MagnaubaAbove the Law, The Dan Markel Case: Is Katherine Magbanua Cutting A Deal?:

A source of mine on the ground in Tallahassee alerted me to an interesting change in the criminal docket for Katherine Magbanua, the woman accused of acting as a conduit in the Dan Markel murder between the two alleged hitmen and whoever ordered Professor Markel’s murder.

When Katie Magbanua was arrested earlier this month in connection with the crime, she was charged with first-degree murder. ... [A]t some point between last week and today, Katherine Magbanua’s exposure got downgraded from first-degree to second-degree murder. What might this mean?

One possibility: Magbanua has entered into a plea agreement and is cooperating with the police. This would not be shocking. ...

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October 25, 2016 in Legal Education | Permalink | Comments (10)

The IRS Scandal, Day 1265: Treasury & IRS CIOs Receive IT Leadership Awards

IRS Logo 2Sonny Bhagowalia (Deputy Assistant Secretary for Information Systems & Chief Information Officer, U.S. Treasury Department) and Gina Garza (Chief Information Officer, IRS) received 2016 FedScoop 50 Leadership Awards. From an internal IRS memo (sent to me by a reader, who says he an IRS IT subcontractor):

Congratulations to CIO Gina Garza and Treasury CIO Sonny Bhagowalia for winning a 2016 FedScoop 50 award. Gina and Sonny were both recognized in the Federal Leadership category.

The FedScoop awards honor the federal and industry leaders who made significant contributions in the areas of cybersecurity and technological modernization. More than 340,000 votes were cast over the one-month voting period to narrow the field to 50 from the more than 1,000 original nominees.

"Receiving this award is such a great honor for me, IT and the IRS. It shows that we are recognized among our governmental technology-sector peers for the great work we do," said Gina.

Congratulations to Gina and Sonny.

From my reader (the IRS IT subcontractor):

"Cybersecurity" in this case being keeping emails from prying Congressional eyes, and "technological modernization" being spending $12 million on an email system that the IRS can't use. Or maybe "recycling" backup tapes on an accelerated schedule.

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October 25, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Monday, October 24, 2016

Polsky Presents The Up-C Revolution Today At Loyola-L.A.

Polsky (2015)Gregg D. Polsky (Georgia) presents The Up-C Revolution (with Adam H. Rosenzweig (Washington University)) at Loyola-L.A. today as part of its Tax Policy Colloquium Series hosted by Ellen Aprill and Katherine Pratt:

Over the past few years, a revolutionary new tax structure, known as the Up-C, has become increasingly popular, particularly in instances where an LLC is being taken public. In such an Up-C IPO, a newly formed C corporation is placed on top of the existing LLC, which continues to operate the business. Shares of the C corporation are sold to new investors, and the proceeds are used by the C corporation to buy an interest in the LLC. Meanwhile, the legacy owners of the LLC (typically, founders and private investment funds) retain their interests in the LLC, while receiving exchange rights that allow them to swap their LLC interests for equivalent-value shares of the C corporation. In addition, the legacy owners often receive the benefit of tax receivables agreements (TRAs), which provide that the owners will receive a specified percentage (usually 85 percent) of the tax benefits to the C corporation resulting from future exchanges. In combination, these features seem to provide a near-nirvana of tax efficiency. It is therefore unsurprising that the popularity of Up-Cs is growing at an exponential rate.

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October 24, 2016 in Colloquia | Permalink | Comments (0)

Frank Presents Papers On High-End Inequality Today At NYU

FrankRobert Frank (Cornell) presents five short articles today at the NYU High-End Inequality Colloquium Series (more here) hosted by Robert Frank (Cornell) and Dan Shaviro (NYU):

The discussant is K. Anthony Appiah (NYU).

 

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

Succession Planning in Law Schools

Bales 2TaxProf Blog op-ed: Succession Planning in Law Schools, by Rick Bales (Former Dean, Ohio Northern):

In business, one of the principal responsibilities of a leader is to groom a successor. At General Electric, for example, CEO Jeff Immelt spends about 40% of his time on developing the company’s future leaders. At Eli Lilly, half the variable compensation for senior executives is tied to mentoring skills and leadership development.

The impact of succession planning in business is often obvious and public. On the negative side, consider Sumner Redstone, who is having a King Lear year as family and confidants publicly grovel for his affection and fight among each other over his media empire even while he’s on the right side of the grass. On the positive side, consider Proctor & Gamble, where for 175 years every CEO started a career there as an entry-level employee.

In law schools, and higher education generally, the impact of succession planning is equally dramatic, if less public. Universities drift; law schools become internally dysfunctional. Moreover, the change in skill sets required as one moves up the higher-education ladder are at least as significant as in business. A great faculty member is strong in the classroom (which requires lots of solo class prep) and a gifted researcher — mostly solitary work; a successful dean must be visible and social and a consensus-builder. Likewise, a great associate law dean is detail-oriented and knows precisely how the train works; a successful dean envisions future destinations and can raise money to lay the track.

The average tenure of a Fortune 500 CEO is 4.6 years — longer than the 3-odd-year tenure of an average law dean [the average tenure of serving deans is 3.6 years; the median tenure is 2.4 years]. Yet, though succession planning is institutionalized at most large companies, in law schools and higher education generally it is haphazard at best. Consider, for example, the number of  searches in which there is not a single viable internal candidate.

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

Call For Tax Papers And Panels: SEALS 2017 (Boca Raton, Florida)

SEALs Logo (2013)Now that we are deep into the fall semester, it's time to think about SEALS 2017! The conference will be held July 31-August 6 in Boca Raton, Florida. The conference submission tool is now open, and Jennifer Bird-Pollan, Leandra Lederman, Francine Lipman, and Shu-Yi Oei, as the Tax Resource team, are eager to coordinate people who are interested in presenting tax work at the SEALS conference into relevant panel groups. In addition, we have also had a very successful Tax Policy Discussion Group in recent years.

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

Johnson:  Were Trump's Fake Losses Legal As Tax Deductions?

Trump 3Calvin H. Johnson (Texas), Were Trump's Fake Losses Legal as Tax Deductions?:

Trump claimed almost a billion of tax losses on his 1995 tax return. Trump did not lose anything like that in economic substance because he never put that much money into his transactions. If he never put it, he did not lose it. Trump must have treated part of the $3.4 bank debt as a cost and tax basis, while inconsistently, not correcting his cost when it turned out not be paid. Sheppard and Lipton have proposed an S corporation or Gitlitz theory, which if applicable would allow the fake loss as a tax deduction, but real estate developers did not use S corporations in the early and middle 1990’s because S corporations trapped all losses inside the corporation where they were wasted. Trump might have reduced basis in real property, rather than taking an immediate income or NOL reduction. In any event, the losses do not “impinge on the world” and courts take away fake tax losses when they see them.

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October 24, 2016 in Political News, Tax | Permalink | Comments (8)

Weapons Of Math Destruction: How U.S. News' 'Craven' Decision To Eschew Affordability In Its Rankings Increases Inequality

WeaponsThe Traps of Big Data (reviewing Cathy O'Neil, Weapons of Math Destruction: How Big Data Increases Inequality and Threatens Democracy (2016)):

As O’Neil defines it, a weapon of math destruction, or WMD, has three elements: Opacity, Scale, and Damage. Combined, these factors create traps with feedback loops, capturing victims in systems they can’t understand and can’t escape, all the while exploiting them. Of the three, Scale seems the most pernicious element, enabling Damage.

After a critique of value-add theory for teachers and a refresher course on the 2008 credit-default swaps and mortgage-backed securities that led to the Great Recession’s financial meltdown, O’Neil produces a trenchant analysis of the U.S. News & World Report college rankings. After reading this chapter about how higher education has become captured by a big data system, the limitations and difficulties of the Impact Factor seem downright charming.

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October 24, 2016 in Law School Rankings, Legal Education | Permalink | Comments (4)

The IRS Scandal, Day 1264: Light Meet Tunnel

IRS Logo 2Politico Morning Tax, Light Meet Tunnel:

The Albuquerque Tea Party and Unite In Action should get a ruling on their tax-exempt status one way or another next month, under a recent order from a federal court. Judge Reggie B. Walton ordered the IRS to make a final decision on the groups’ status by Nov. 11, which will be more than six years after the organizations applied for a tax exemption. As our Toby Eckert notes, the fact that those groups still hadn’t heard from the IRS played a role in the revival of a lawsuit filed by the American Center for Law and Justice on their behalf. A lower court had tossed the suit a couple years ago, finding that the IRS was no longer improperly scrutinizing tea party groups.

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

TaxProf Blog Weekend Roundup

Sunday, October 23, 2016

Tax Papers At ClassCrits IX Conference At Loyola-Chicago

ClassCrits

Critical Perspectives on Tax Law 

  • Les Book (Villanova), Bureaucratic Oppression and the Tax System, 69 Tax Law. 567 (2016)
  • Samuel Brunson (Loyola-Chicago), Avoiding Progressivity: RICs, Pease, and the AMT
  • David Herzig (Valparaiso), Let Prophets Be (Non) Profits
  • Shu-Yi Oei (Tulane), The Troubling Case of Offshore Tax Enforcement 

Distributing Wealth, Law and Power

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

More Than 30 Law Schools Pay Student Bar Review Costs: Does It Improve Pass Rates?

Bar Review LogosABA Journal, More Law Schools Are Covering Bar Review Costs: Is It Improving Pass Rates?:

Out of law schools who have July 2016 bar results for first-time test takers, many saw their pass rate percentages drop.

And of the schools that saw pass rates rise, some are increasingly covering partial or entire bar review costs for graduates.

Mike Sims, president of the test prep group BARBRI Bar Review, told that ABA Journal that more than 30 law schools now pay for their students’ bar review. According to the business’s website, courses cost between $2,595 and $3,995, depending on when someone enrolls.

“I beg for money from alumni and say it’s a great investment, because otherwise these people will keep failing,” says Lawrence W. Moore, interim dean of Loyola University New Orleans College of Law.

The school’s first-time test-taker pass rate for July 2016 was 76.69 percent;last year it was 71.53 percent.

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October 23, 2016 in Legal Education | Permalink | Comments (3)

The Top 5 Tax Paper Downloads

SSRN LogoThere is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new paper debuting on the list at #4. The #1 paper is now #23 in all-time downloads among 12,295 tax papers):

  1. [3,668 Downloads]  Families Facing Tax Increases Under Trump's Latest Tax Plan, by Lily L. Batchelder (NYU)
  2. [204 Downloads]  Taxation and Human Rights: A Delicate Balance, by Reuven Avi-Yonah (Michigan) & Gianluca Mazzoni (S.J.D. 2017, Michigan)
  3. [190 Downloads]  Law and Macroeconomics: The Law and Economics of Recessions, by Yair Listokin (Yale)
  4. [155 Downloads]  Interrogating the Relationship between 'Legally Defensible' Tax Planning and Social Justice, by Daniel Shaviro (NYU)
  5. [150 Downloads]  Capital Taxation in an Age of Inequality, by Edward Kleinbard (USC)

October 23, 2016 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Focus On Reputation/Selectivity Over Earnings/Outcomes Will Render U.S. News Rankings An Anachronism

US NewsNew York Times, How Much Graduates Earn Drives More College Rankings:

PayScale introduced its first college salary report in 2008, and the College Scorecard from the federal government followed last year, ushering an elephant into the hallowed halls of college admissions: What do the schools’ graduates actually earn?

Despite the hand-wringing of many in academia, who saw the immeasurable richness of a college education crassly reduced to a dollar sign, the data has wrought a sea change in the way students and families evaluate prospective colleges. Earnings data are finding their way into a proliferating number of mainstream college rankings, shifting the competitive landscape of American higher education in often surprising ways.

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October 23, 2016 in Law School Rankings, Legal Education | Permalink | Comments (5)

The IRS Scandal, Day 1263: The Denial Of Probe Into IRS Disclosure Of Taxpayer Information Is ‘Alarming’

IRS Logo 2Bloomberg BNA, Denial of Probe Into IRS Disclosure ‘Alarming,’ Group Says:

The dismissal of an investigation into the IRS’s disclosure of protected taxpayer information by a government watchdog is “alarming,” a conservative group said.

The Cause of Action Institute in June asked the Department of Justice Inspector General and the Treasury Inspector General for Tax Administration to “examine potential legal violations arising from the October 2010 disclosure of more than one million pages of tax returns and return information to the FBI and DOJ Public Integrity Section by” the Internal Revenue Service and former agency official Lois Lerner, the group said in an Oct. 20 news release.

As part of the request, the institute asked that the DOJ watchdog examine whether the Federal Bureau of Investigation and DOJ employees violated taxpayer confidentiality laws by inspecting the disclosed data.

The DOJ Inspector General responded in an Oct. 12 letter signed by Daniel C. Beckhard, assistant inspector general for the Oversight and Review Division. It appeared that some protected taxpayer information was included on compact discs that the IRS provided to the department, the inspector general said, but when the department learned of that disclosure, it returned the CDs to the IRS and informed Congress.

“Given the absence of available information suggesting that Department employees over whom our Office has jurisdiction might have engaged in conduct that violates laws, regulations, or policy, we have determined that this matter does not warrant further investigation,” Beckhard said in the letter, which was attached to the CoA Institute’s news release.

The CoA Institute said it has filed a Freedom of Information Act request with the DOJ watchdog to “determine the exact nature of its notification to Congress.” ...

“The DOJ IG’s response is concerning,” said John J. Vecchione, vice president at the CoA Institute. “While admitting that the IRS did, in fact, disclose confidential taxpayer information, the IG failed to address the absence of any proper requests for disclosure from the DOJ,” he said. “Even more alarming, the IG refused to conduct an investigation into legal violations because of the ‘absence of available information,’ ” Vecchione said.

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October 23, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (16)

Saturday, October 22, 2016

This Week's Ten Most Popular TaxProf Blog Posts

ABA Council Approves 75% Minimum Bar Pass Rate

ABA Section On Legal Education (2016)National Law Journal, Tighter Bar-Pass Rule Adopted by ABA Accrediting Body:

The American Bar Association body that accredits law schools voted on Friday to tighten the bar exam-passage standard that schools must meet in order to get the organization’s accreditation blessing. The ABA’s Council of the Section of Legal Education and Admissions to the Bar overwhelmingly decided to strengthen its bar pass standard for accredited law schools—a long-debated move proponents said is necessary to ensure law schools don’t admit students unlikely of passing the all-important attorney licensing exam.

The council voted for the stricter standard over the opposition of diversity advocates who warned that schools with large numbers of minority students could lose their accreditation and that the stricter rule would prompt schools to admit fewer minority students. That, in turn, would exacerbate the legal profession’s longstanding diversity problem, they argued.

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

Retired U.S. Tax Court Judge Pleads Guilty To Tax Fraud While She Sat On The Court

TCKFollowing up on my previous posts:

Minneapolis Star Tribune, Former Tax Court Judge From Twin Cities Pleads Guilty to Tax Fraud:

A former U.S. Tax Court judge pleaded guilty Friday to conspiring with her husband to fraudulently omit nearly $1 million of income from their tax returns while she served as judge, using the gains on personal expenses like international trips and Pilates classes.

Diane Kroupa, 61, faces up to five years in prison after pleading guilty to conspiracy to defraud the United States in federal court in St. Paul. A federal grand jury indicted Kroupa and her then-husband, Robert Fackler, 63, in April.

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October 22, 2016 in New Cases, Tax | Permalink | Comments (3)

Greg Mankiw Happily Paid $2,500 For A Hamilton Ticket, But Asks: Why Should 80% Go To Resellers Rather Than Lin-Manuel Miranda?

Hamilton 3Continuing my obsession with interest in Hamilton (links below):  Sunday New York Times op-ed: I Paid $2,500 for a ‘Hamilton’ Ticket. I’m Happy About It., by N. Gregory Mankiw (Harvard):

You may have heard that “Hamilton” tickets are hard to come by. ... We, however, had no problem getting tickets. Two weeks before our trip, I logged into StubHub, the online ticket marketplace owned by eBay. I found the performance we wanted, located some great seats and within a few minutes was printing our tickets.

The rub is the price. Including StubHub’s fee, I paid $2,500 a ticket, about five times their face value. Such a large markup is not unusual.

Now, at this point, some people might object to this price. Terms like “scalping” and “price gouging” are pejoratives used to demonize those who resell tickets at whatever high prices the market will bear.

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October 22, 2016 in Legal Education, Tax | Permalink | Comments (4)

The IRS Scandal, Day 1262: Z Street Receives 501(c)(3) Tax-Exempt Status, Seven Years After Filing Application

IRS Logo 2Politico Morning Tax, Welcome to the Club, Z Street:

The conservative, pro-Israel group was just granted its tax-exempt 501(c)(3) status, almost seven years after it first applied. Z Street had sued the IRS, making the case that its tax-exempt application drew extra scrutiny from the agency because of its disagreements with the Obama administration over Israel. Other conservatives also accused the IRS of foot-dragging, which they connected to the agency’s improper scrutiny of tea party groups. Plus, there was at least one guy popular with Democrats who gave the IRS poor marks for its handling of the application: Judge Merrick Garland, now President Barack Obama’s pick for the Supreme Court, who heaped scorn on the IRS’s argument that it had a cushion protecting it from the lawsuit.

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October 22, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Friday, October 21, 2016

Weekly Tax Roundup 2.0

Note from Paul Caron:  As I explained on August 1, due to my growing other commitments, I have taken steps to reduce the amount of time I devote to TaxProf Blog.  I previously have announced that:

Today, I am pleased to announce that Joe Kristan, CPA & Shareholder, Roth & Company (Des Moines, Iowa), and editor of Tax Update Blog, one of my favorite tax blogs, has taken over the weekly tax roundup.  (I took a side trip to meet with Joe when I went to my son's first Grinnell College soccer game in 2009.)  I am delighted that Joe is adding a new feature to the roundup:  a discussion of one of the week's important tax developments (often a Tax Court decision).

In this week's inaugural post, Joe discusses Hicks v. Commissioner, T.C. Summ. Op. 2016-68 (Oct. 17, 2016), in Good Records Do Not a Business Mile Make:

KristanGood Records, Bad Facts. A Tax Court case this week shows that no matter how good your records are, they don’t help if they meticulously document why your expenses aren’t deductible.

The taxpayers, whose surname name we abbreviate here as “H,” had an unusual Schedule C. Judge Carluzzo explains:

Petitioners, or at least one of them, established SC Management in 2005. According to petitioner, its stated purpose was to manage the careers of the H family. Although the exact services that the business was intended to provide with respect to the career(s) of each family member are less than clear, it appears that each family member agreed to contribute a portion of income earned from outside sources to SC Management in return for whatever services the family member received. During the years in issue the income shown on the Schedules C is attributable to amounts petitioner and one of his children earned.

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October 21, 2016 in New Cases, Tax, Weekly Tax Roundup | Permalink | Comments (0)

Weekly SSRN Tax Article Review And Roundup

This week, David Gamage (UC-Berkeley, moving to Indiana) reviews a new article by Gregg Polsky (Georgia) and Adam Rosenzweig (Wash U), The Up-C Revolution (Oct. 13, 2016):

Gamage (2017)When I was in law school, I was taught what was then the conventional wisdom about the U.S. Corporate Income Tax (the “CIT”)—that it was in the process of being eroded through sophisticated tax planning, with the expectation that it would soon shrink to irrelevance as source of federal revenue.  Yet, somewhat ironically, my law school years turned out to mark the (temporary?) end of that trend.  Although the CIT shrank dramatically as a source of federal government revenues during the period from the 1950s through the early 2000s, CIT revenues have since remained more or less constant as a percent of GDP from the early 2000s through today (albeit fluctuating with economic conditions).

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October 21, 2016 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Legal Education Roundup

NY Times Op-Ed:  Just Like Trump, I Avoided Paying Federal Taxes

New York Times op-ed:  Just Like Trump, I Avoided Paying Federal Taxes, by Bert Stratton:

I’m like Donald Trump, somewhat. We both inherited buildings from our fathers. I’ve kept my father’s properties and bought a couple more buildings. For my first couple of years I had “loss carry-forwards.” I lost money and paid no federal taxes.

Some dads teach their sons fishing. My dad taught me to do taxes.

He kept two sets of books — one pencil, one ink. Self-made guys, like my dad, often kept two sets of books, a retired accountant later told me. The second-generation, like me, usually goes legit, he said. ...

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

Arizona Summit Law School's Bar Passage Rate Plummets To Shocking 24.6% (Down From 96.7% In 2008)

Virginia Tax Review Publishes New Issue

Virginia Tax Review (2016)The Virginia Tax Review has published Vol. 35, No. 3 (Spring 2016):

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

Georgetown College Rankings: Earnings, Majors, Academic Preparation, And Graduate Degree Attainment

Georgetown CoverGeorgetown University Center on Education and the Workforce, Ranking Your College: Where You Go and What You Make (pdf):

In September 2015, the U.S. Department of Education released its redesigned College Scorecard, a web tool that allows users to access a vast array of information about the quality of colleges and universities throughout the country. For the first time, users can easily find how much students who have taken courses in thousands of colleges across the United States earn 10 years after enrolling, which is essential information for students deciding where to go to college and how much debt to take on. The Department of Education designed the College Scorecard to be used by prospective students evaluating their college options.

The following tables use the College Scorecard data to rank colleges and universities strictly on earnings, but then test how sensitive the ranking of a university is when adjustments are made to earnings. The analysis attempts to help answer several questions: How important is student preparation? How much are average earnings skewed by choice of majors and by the selection of majors available at a particular university? If a university, such as Stevens Institute of Technology, ranks high strictly in earnings but much lower after adjusting for composition of majors, it would indicate that the distribution of majors at the university is of primary importance. If another university, such as Harvard, retains its ranking even after adjusting for expected earnings based on its share of majors, it might indicate that the quality of the university matters as much as the majors it offers.

The academic preparation of the students is another important factor. If a university, such as Pepperdine University, rose in the rankings based on this factor, it is a clear indication that the university was able to produce a higher quality of students than would have been expected based on the students' academic preparation. In other words, a university helped students to become better and earn more money in their future.

Georgetown

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October 21, 2016 in Legal Education | Permalink | Comments (7)

The IRS Scandal, Day 1261: George Will And Donald Trump Are Wrong — Elections Are Not Rigged, And The IRS Is Not Rigging Them

IRS Logo 2Salon, George Will Says Donald Trump Is Simply Making the Wrong Argument About Rigged Election, Is Incredibly Wrong:

George Will is a fan of voter purging. He's also an old white male. That explains it.

As most of the conservative fold realizes that conspiracy theorist Donald Trump is Godzilla and the Republican Party is Tokyo, George Will is dipping his toes into the Pacific Ocean and thinking, maybe there’s something here.

On Monday, Will told Fox News that Trump “has a point” when he claims that the election is rigged, according to a transcript via RealClearPolitics:

It is hard to think of an innocent reason why Democrats spend so much time, energy and money, scarce resources all, resisting attempts to purge the voter rolls, that is to remove people who are dead or otherwise have left the jurisdiction. It’s hard to think of an innocent reason why they fight so tremendously against Voter I.D. laws. They say, well, that burdens the exercise of a fundamental right. The Supreme Court has said that travel is a fundamental right and no one thinks that showing an I.D. at the airport burdens that fundamental right.

We know — we don’t surmise — we know that the 2010, ’12 and ’14 elections were rigged by the most intrusive and potentially punitive institution of the federal government, the IRS. 

First of all, the election is not rigged. This can’t be stressed enough. Also, if Will is claiming that the 2010 and 2014 elections were rigged (they weren’t), they would have been rigged for Republicans, who during the midterms rode two wave elections.

And we’ll completely ignore his claim that “vote rigging” includes Internal Revenue Service audits of whether 501(c)4 organizations are really “promot[ing] the social welfare” — or existing to create valuable and profitable email lists for others to rent.

But here’s the reason why Democrats “spend so much time, energy and money” resisting attempts to purge the voter rolls. Because most of the time, that’s code for “making sure lots of Democrats don’t vote.” ...

Republicans have pushed illegal voter ID laws and have pursued a questionable tactic known as “voter caging.” Even if the people affected by these voter-suppression strategies are able to get to the polls, they would have to file provisional ballots and could face longer lines in fewer polling places. Such tactics, unsurprisingly, have mainly been applied in minority areas.

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October 21, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Thursday, October 20, 2016

Virginia Tax Review Publishes New Issue

Virginia Tax Review (2016)The Virginia Tax Review has published Vol. 35, No. 2 (Winter 2016):

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

NY Times:  Corporate Tax Problems And Solutions

New York Times op-ed: The Big Companies That Avoid Taxes, by David Leonhardt:

Donald Trump has become the country’s most notorious tax shirker. And while his long avoidance of federal income taxes is extreme, it’s also part of a larger problem.

The most affluent and powerful parts of our society have too easy a time legally avoiding taxes.

Consider corporate taxes, which ultimately tend to be paid by the well-off, because they own the most stock. The official corporate rate is 35 percent, infamously higher than in any other advanced economy. Yet there are so many loopholes that companies often pay relatively little in tax.

Many companies work hard to shroud how much they really pay, sprinkling various figures throughout their complex financial statements. But companies must report one number that provides a good glimpse. It’s called cash taxes paid — the combined amount that a company pays in federal, state, local and even foreign taxes.

I asked the analysts at S&P Global Market Intelligence to calculate this number since 2007 for this country’s 500 largest public companies, and the results reveal a broken tax system. Fixing it should be an early priority for the next president. If Hillary Clinton wins, it may well be.

NY Times

New York Times op-ed: We Can Fix Corporate Taxes, by David Leonhardt:

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

LSAT Is Poor Predictor Of Law School Grades: 6 LSAT Points = 0.1 LGPA

LSAT (2015)Alexia Brunet Marks (Colorado) & Scott A. Moss (Colorado), What Makes a Law Student Succeed or Fail? A Longitudinal Study Correlating Law Student Applicant Data and Law School Outcomes, 13 J. Empirical Legal Stud. 205 (2016):

Despite the rise of "big data" empiricism, law school admission remains heavily impressionistic; admission decisions based on anecdotes about recent students, idiosyncratic preferences for certain majors or jobs, or mainly the Law School Admission Test (LSAT). Yet no predictors are well-validated; studies of the LSAT or other factors fail to control for college quality, major, work experience, etc. The lack of evidence of what actually predicts law school success is especially surprising after the 2010s downturn left schools competing for fewer applicants and left potential students less sure of law school as a path to future success. We aim to fill this gap with a two-school, 1400-student, 2005-2012 longitudinal study. After coding non-digitized applicant data, we used multivariate regression analysis to predict law school grades ("LGPA") from many variables: LSAT; college grades ("UGPA"), quality, and major; UGPA trajectory; employment duration and type (legal, scientific, military, teaching, etc.); college leadership; prior graduate degree; criminal or discipline record; and variable interactions (e.g., high-LSAT/low-UGPA or vice-versa).

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October 20, 2016 in Legal Education, Scholarship | Permalink | Comments (12)

Crawford & Spivack:  Tampon Taxes, Equal Protection And Human Rights

Bridget J. Crawford (Pace) & Carla Spivack (Oklahoma City), Tampon Taxes, Equal Protection and Human Rights, 2016 Wis. L. Rev. ___ :

In recent months, activists around the globe have harnessed the power of the Internet to raise awareness of the so-called “tampon tax,” an umbrella term to describe sales, VAT and similar “luxury” taxes imposed on menstrual hygiene products. In response to pressure from constituents, five U.S. states and Canada have repealed their tampon tax. Active campaigns are underway in Australia, the United Kingdom and several other countries. Where public pressure has not been an effective technique, those seeking to challenge the tampon tax in the United States have turned to litigation. In four U.S. states, class action lawsuits have been filed seeking repeal of the tax and a refund for back taxes paid, alleging equal protection violations. In the international context, human rights law provides a promising foundation for similar legal challenges to the tampon tax because human rights law takes a capacious approach to gender equality. In the European Court of Human Rights, for example, there are several tax cases that recognize gender-differentiated taxes as a form of impermissible discrimination. This Article explains how the tampon tax violates equal protection and human rights norms. The tax also shows how deeply embedded gender is in matters of tax policy. Full realization of gender equality will require revision of tax laws.

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

Wake Forest Symposium: Revisiting Langdell — Legal Education Reform And The Lawyer’s Craft

Wake 4Symposium, Revisiting Langdell: Legal Education Reform and the Lawyer’s Craft, 51 Wake Forest L. Rev. 231-420 (2016):

Legal Scholarship in the Era of Reform

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

Carter:  Estate Planning For Digital Assets

Digital AssetsElizabeth Ruth Carter (LSU), Estate Planning for Digital Assets: Assigning Tax Basis and Value to Digital Assets:

These materials were prepared in conjunction with the LSU 46th Estate Planning Seminar. They explore the various types of digital assets--including social media (Facebook, Twitter, Linked In, etc.), audiobooks, music and video files, and bitcoin--and the estate planning challenges these assets present.

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October 20, 2016 | Permalink | Comments (0)

The ABA 75% Bar Passage Rule: Dead On Arrival?

Bales 2TaxProf Blog op-ed: The ABA 75% Rule: Dead on Arrival?, by Rick Bales (Former Dean, Ohio Northern):

Current ABA accreditation standards have attracted widespread public criticism for being toothless in the face of predatory law schools granting admission (and charging hefty tuition) to students with little or no chance of passing a bar exam. In response, proposed ABA standards would create a new 75% rule. As Daniel Rodriguez (Northwestern) and Craig Boise (Syracuse) explain in the National Law Journal (cross-posted without subscription requirement at TaxProf Blog):

The American Bar Association's Section of Legal Education and Admissions to the Bar has proposed tightening up its regulation of those law schools with a significant ­percentage of graduates who have failed their state's bar exam. Under the proposed new accreditation standard, law schools must ensure that at least three-quarters of their graduates pass the bar after two attempts, rather than five, as is the case under the current standards. As with any numerical benchmark, the measure is imperfect, yet its purpose is a sound one.

Yet before the ink is even dry on the proposed rule, at least one school has found a way to circumvent it.

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October 20, 2016 in Legal Education | Permalink | Comments (6)

The IRS Scandal, Day 1260: Cleta Mitchell — Use Of The IRS Against Republican Critics Likely Will Persist In A Clinton Administration

IRS Logo 2Washington Times op-ed:  Hillary Clinton’s IRS — A Sneak Preview: Use of the Agency Against Republican Critics Likely Will Persist, by Cleta Mitchell  (Foley & Lardner, Washington, D.C.):

Imagine:  What if the Internal Revenue Service (IRS) singled out hundreds of grassroots citizens groups across the nation and subjected them to ill treatment because of their political beliefs and values, mainly in opposition to the president of the United States? And imagine if that president ordered an investigation of the scandal and the lead attorney was a maximum donor to the president’s political campaigns. And then imagine if the president appointed as IRS commissioner to “clean up” the scandal someone who was a maximum donor to the president’s political campaigns. Can you imagine such a thing? The watchdogs in Congress and the media would never allow such clear partisanship to rule the IRS, right?

But that is exactly the situation we have watched unfold over the past three years, since the Treasury inspector general for tax administration (TIGTA) confirmed that the IRS had, indeed, targeted conservative groups — hundreds of them — for singular mistreatment and abuse. The Department of Justice attorney charged with “investigating” the targeting was Barbara Bosserman, an individual who had contributed the maximum to President Obama’s political campaigns.

And what about IRS Commissioner John Koskinen? He is yet another maximum Democratic donor. Since 1997, Mr. Koskinen has contributed $51,550 to the Democratic National Committee, various Democratic congressional and Senate candidates and the presidential campaigns of John Kerry, Barack Obama and Hillary Clinton. ...

What harm might arise from having one of Hillary Clinton’s staunchest supporters at the helm of the IRS? Think back. During the Bill Clinton administration, the IRS audited a host of Clinton “enemies”: According to the Christian Science Monitor, the Clinton-era IRS, like several before it, audited a wide range of organizations viewed as hostile to the White House agenda. These included leading conservative publications, think tanks and interest groups, among them the American Spectator, Judicial Watch, National Review, the Heritage Foundation, the National Rifle Association, the National Center for Public Policy Research, the American Policy Center, American Cause, Citizens for Honest Government, Citizens Against Government Waste, Progress and Freedom Foundation, and Concerned Women for America. The IRS also audited two Clinton paramours: Gennifer Flowers and Liz Ward Gracen, and sexual assault accusers Paula Jones and Juanita Broaddrick, as well as fired White House Travel Office Director Billy Dale.

There was never anyone in the IRS held to account for the Clinton administration’s targeting of its perceived “enemies” for IRS audits; there has likewise been no accountability for the oppression and discrimination practiced by Mr. Obama’s IRS via the targeting of those groups who have opposed and criticized the Obama administration.

Nor has Congress taken steps to prohibit the IRS from using donor information as a basis for generating IRS tax audits, and there is ample evidence that the IRS audited scores of donors to the 2012 Mitt Romney presidential campaign and the super PAC supporting Mr. Romney.

A Hillary Clinton presidency, with a maximum Clinton donor running the IRS, would not bode well for conservative organizations, donors, activists and sympathizers. ... 

As long as the liberal media and congressional Democrats collude with Democratic administrations in their targeting and attacking of conservatives, the Democrats in the White House will feel free to use the agencies of the federal government — including the IRS — as political weapons against those who criticize and disagree with them.

A Hillary Clinton presidency, with an IRS commissioner who has long been an ardent political supporter and donor, does not present a very encouraging picture of a non-political IRS that will resist being used as an arm of the Democratic White House.

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October 20, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (7)

Wednesday, October 19, 2016

Gamage Presents Tax Cannibalization And Fiscal Federalism Today At Toronto

Gamage (2017)David Gamage (UC-Berkeley, moving to Indiana) presents Tax Cannibalization and Fiscal Federalism in the United States, 111 Nw. U. L. Rev. ___ (2017) (with Darien Shanske (UC-Davis)), at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series:

The current structure of U.S. federal tax law incentivizes state governments to adopt tax policies that inflict costs on the federal government, at the expense of national welfare. We label this the “tax cannibalization problem.”

This article introduces the tax cannibalization problem to the law and policy literatures for the first time. This article also explains how U.S. federal tax law might be restructured so as to alleviate the tax cannibalization problem — to counteract the perverse incentives currently leading U.S. state governments to design their tax systems so as to, in effect, wastefully devour federal tax revenues.

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

Speck Presents Expertise And International Tax Norms Today At Northwestern

SpeckSloan Speck (Colorado) presents Expertise and International Tax Norms at Northwestern today as part of its Advanced Topics in Taxation Workshop Series hosted by Sarah Lawsky:

This project explores the ways in which a particular framework for understanding international taxation—a framework driven by so-called international tax neutrality norms—developed among economists and legal academics in the 1960s and subsequently became entrenched among public-sector policymakers. The neutrality norm framework marks a turn from the instrumental use of international taxation in the 1950s toward the ostensibly objective, efficiency-driven orientation towards international taxation that dominates discussions about international tax policy today (though a growing academic literature questions the viability of this orientation). This project explores how the neutrality norm framework came into being, and how it became a durable framework for understanding international tax policy.

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

HBCU Law Deans Oppose ABA's Proposed 75% Bar Passage Accreditation Requirement Due To Diversity Concerns

HBCUNational Law Journal op-ed:  HBCU Law Deans Say ABA Bar-Passage Rule Changes Will Hurt Profession's Diversity, by Dannye Holley (Former Dean, Texas Southern), Danielle Holley-Walker (Dean, Howard), John Pierre (Dean, Southern), Felecia Epps (Dean, Florida A&M), Phyliss Craig-Taylor (Dean, North Carolina Central) & James Douglass (Interim Dean, Texas Southern):

The proposed changes to the ABA's bar-passage standard, set to be decided this week, have been the subject of great debate. Some, like Daniel Rodriguez and Craig Boise, deans of Northwestern University Pritzker School of Law and Syracuse University College of Law, respectively, have written in support of the proposed changes to Standard 316. But these proposed changes come at a time when bar-passage rates in many states have been declining, and there are many unanswered questions about the impact of the adoption of the Uniform Bar Exam. Furthermore, at a time when the legal profession continues to struggle with a lack of racial and ethnic diversity, many of the schools that will be impacted by this change are schools who enroll large minority student populations. ...

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October 19, 2016 in Legal Education | Permalink | Comments (5)

Competing Against Luck: Restructuring Higher Education

CompetingWall Street Journal, The Customer Is Always Right (reviewing Clayton M. Christensen (Harvard Business School), Competing Against Luck (2016)):

Every large company is consumed by the question of innovation. How to organize for it, how to execute it and how to deliver its benefits to customers. The attributes of big companies seem incompatible with those required to innovate. Size suffocates creativity. Efficiency kills dynamism. Executives become hostage to the data thrown up in a million slides and presentations, and they forget what it’s like to be a customer of the companies they lead.

Clayton M. Christensen is best known for his theory of disruptive innovation, which for some time now has had CEOs lining up outside his office at Harvard Business School. It is, he reminds us, a theory, not unassailable truth. But as a theory, it is immensely helpful in understanding how incumbent companies respond to the threat of innovation—for the most part, badly. Kodak was disrupted when it could not give up its profitable film business fast enough to adjust to the boom in digital photography. The newspaper industry is still suffering from the loss of its stranglehold on classified advertising to rudimentary services like Craigslist.

Disruption, in Mr. Christensen’s formulation, is not caused simply by anything new or clever. It arrives in the form of “minuscule threats” at the bottom of the market. The studios and networks treated Netflix as a minor player when it mailed DVDs, not seeing that the move to online streaming would turn it into a formidable competitor.

Similarly, grand universities right now see no threat from grubby online courses. But over time students and parents may wonder why they should pay all that money for sports facilities they don’t use and professors who don’t teach. Meanwhile, employers start to ask potential employees what they can do rather than where they went to school. And maybe the whole structure of higher education shifts.

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October 19, 2016 in Book Club, Legal Education | Permalink | Comments (0)

Dean Darby Dickerson Leaves Ranked Texas Tech Mid-Year For Unranked, Downsizing, Deficit-Ridden John Marshall

DickersonCrain's Chicago Business, New Dean for Downsized John Marshall Law School:

Darby Dickerson, a South Carolina native and since 2011 dean of Texas Tech University's law school, takes over an institution whose enrollment and full-time faculty have each by more than a third since 2010. She said John Marshall is in “solid financial condition” but could be “a little more right-sized.”

In the latest available IRS filing, the not-for-profit school reported a $1.07 million deficit for fiscal 2014, compared with a $3.65 million surplus the year earlier. ...

Dickerson, 52, said she was asked bluntly during a job interview why she would leave a ranked law school for an unranked one. Being a “functional president” at an independent school appealed to her, she said. Another plus is John Marshall's reputation for producing “practice-ready” attorneys. ...

In 2010 John Marshall had 1,400 students and 80 full-time faculty members. .. Now, there are 900 students and 47 faculty members. ... 

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

Texas A&M Seeks To Hire A Tax Clinic Director

Texas A&M Law SchoolTexas A&M University School of Law seeks to hire a director of its tax clinic:

The Director of the Texas A&M University Low Income Tax Clinic is responsible for all aspects of the Tax Clinic, including client representation, law student supervision, classroom instruction, community outreach and education, and IRS compliance. The Tax Clinic will be part of the Low Income Taxpayer Clinic program of the U.S. Internal Revenue Service.

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October 19, 2016 in Tax, Tax Prof Jobs | Permalink | Comments (0)

What Wendi Adelson's Novel Reveals About Dan Markel's Murder

WendiWendi Adelson's Criminally Lousy Novel, This is Our Story:

A few months ago, Above the Law published recordings of Adelson’s presentations to a writer’s workshop, held some time after Markel’s murder. Adelson complained, inter alia, that her “late ex-spouse” (a phrase Adelson creatively punned as her “latex spouse”) did not care for fiction  and did not read her book. (Podcast, 9:42-9:47, 10:28-10:33) I found this plaint to be unfair because, whatever his private misgivings, Markel extensively promoted Adelson’s debut novel, “This is Our Story” on his popular academic blog “Prawfsblawg.” (The novel was published in 2011, about a year before Adelson walked out on Markel, with infant children, bank accounts, furniture, and Markel family heirlooms in tow).

In spite of the intense publicity generated by the lurid murder mystery starring herself, I do not believe anyone has yet explored Adelson’s novel as a possible window into the self-perception of its enigmatic author.

Even at the risk of death by Prius-driving hitman, I am compelled endorse the latex Markel’s decision not to read his wife's novel. This is Our Story is inartful, shallow, clichéd, oddly bland given its human trafficking theme, and terribly self-important. Interestingly though, Adelson states that her book purports to tell, in substantial part, her own story. In an afterword to her novel, Adelson states that “I, selfishly, wanted you to know a bit about my story, which has much – but not all – in common with Attorney Lily” (i.e. the main character in the novel). Adelson, Wendi (2011-09-12). This is Our Story (Kindle Locations 3948-3949). Kindle Edition. ...

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October 19, 2016 in Book Club, Legal Education | Permalink | Comments (24)

The IRS Scandal, Day 1259: George Will — Trump Is Right That Elections Are Rigged, And The IRS Is Exhibit A

IRS Logo 2Real Clear Politics, George Will: Trump Has Point That Elections Are Rigged If He Would Just Make It More Clearly:

When Mr. Trump talks about it being rigged, he sweeps all his grievances into one big puddle. He talked about the media. He talked about the primaries. He talked about the polls. Talked about the Republican National Committee. I think when most persons hear that an election is rigged, they think of government action to rig the election. And there Mr. Trump has a point if he would just make it more clearly. 

It is hard to think of an innocent reason why Democrats spend so much time, energy and money, scarce resources all, resisting attempts to purge the voter rolls, that is to remove people who are dead or otherwise have left the jurisdiction. It's hard to think of an innocent reason why they fight so tremendously against Voter I.D. laws. They say, well that burdens the exercise of a fundamental right. The Supreme Court has said that travel is a fundamental right and no one thinks that showing an I.D. at the airport burdens that fundamental right.

We know -- we don't surmise -- we know that the 2010, '12 and '14 elections were rigged by the most intrusive and potentially punitive institution of the federal government, the IRS. You can read all about it in Kim Strassel's book Intimidation Game. She's familiar to all Wall Street Journal readers and FOX viewers. This is not a surmise. I have talked to lawyers in a position to know they say it's still going on. The IRS is still intolerantly delaying the granting of tax exempt to conservative advocacy groups to skew the persuasion of this campaign.

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October 19, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Tuesday, October 18, 2016

McCormack Presents Postpartum Taxation: The Internal Revenue Code And The Opt Out Mom Today At Columbia

McCormackShannon Weeks McCormack (University of Washington) presents Postpartum Taxation: The Internal Revenue Code and the Opt Out Mom at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium Series hosted by Alex Raskolnikov and Wojciech Kopczuk:

Legislation seeking to ensure that women receive equal pay for equal work has been on the books for decades. Nevertheless, the average American woman still receives less than eighty cents for every dollar earned by the average American man. Happily, the gender pay gap between men and childless women is narrowing over time. Meanwhile, the gap between mothers and others continues to widen. Career interruptions contribute significantly to this disturbing trend — nearly half of mothers opt out of the workforce at some point in their lives, most often to care for young children. Faced with too-short (or non-existent) maternity leaves, inflexible work schedules and the soaring costs of childcare in the United States, this opt out phenomenon is hardly surprising. But with the decision to opt out comes grave cost. Over 90% of opt out moms want to return to the workforce several years after off ramping. Unfortunately, many discover that they are unable to do so. A mother that does manage to reenter the workforce will find that even a short off ramp results in a sizeable and disproportionate reduction in her annual earnings that will persist for every year of her remaining life.

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October 18, 2016 in Colloquia, Scholarship, Tax | Permalink | Comments (5)

A Nobel Prize In Tax Law Would Go To ... Michael Graetz Or Louis Kaplow?

Nobel PrizeFollowing up on yesterday's post, A Nobel Prize In Law Would Go To ... Calabresi, Posner, Or Sunstein?:  Brian Leiter (Chicago) polled this question:

If there were a Nobel Prize, which living legal scholar in the U.S. should get it? Rank order the [51] candidates. Only those over the age of 60 who might make the top ten are listed as choices. 

Michael Graetz (Columbia) and Louis Kaplow (Harvard) were the only tax folks among the 51 candidates. Louis finished 21st in the 129 ballots cast, sandwiched between Frank Easterbrook (7th Circuit/Chicago)/Martha Minow (Harvard) and Phiilip Bobbit (Columbia). Michael finished 42nd, sandwiched between Deborah Rhode (Stanford) and Daniel Fischel (Chicago).  The results are here, along with the rankings on the 129 individual ballots.

October 18, 2016 in Legal Education, Tax | Permalink | Comments (2)

Taubinsky Presents Heuristic Perceptions Of The Income Tax Today At UC-Berkeley

Taubinsky 2Dmitry Taubinsky (Dartmouth) presents Heuristic Perceptions of the Income Tax: Evidence and Implications for Debiasing (with Alex Rees-Jones (Pennsylvania)) at UC-Berkeley today as part of its Robert D. Burch Center for Tax Policy and Public Finance Seminar:

This paper reports a new survey experiment designed to directly assess misperceptions of the US Federal Income Tax, and presents a theoretical framework for analyzing the redistributive consequences of these misperceptions. Survey participants are asked a series of incentivized questions about the tax that would be owed by a hypothetical taxpayer. This taxpayer is nearly identical to the participant, but household income is varied across questions; forecasts in this setting identify perceptions of the full tax schedule. We estimate the prevalence of previously discussed heuristics for simplifying tax forecasts (Liebman and Zeckhauser, 2004), and identify the qualitative features of the remaining misperceptions that are not captured by existing models.

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October 18, 2016 in Colloquia, Scholarship, Tax | Permalink | Comments (0)