TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Friday, October 28, 2016

The IRS Scandal, Day 1268: Sen. Whitehouse — Republicans Are Using Koskinen Impeachment To Bring IRS To Heel On Dark Money Campaign Financing

IRS Logo 2The Hill op-ed: The Republican Mission to Quell the IRS, by Sen. Sheldon Whitehouse (D-RI):

It looks like any other slick political ad on your TV. There’s ominous music, a dramatic voice-over, a grainy picture of President Obama. But this isn’t just another campaign commercial.

The news broke recently that a Republican mega-donor plans to spend about $1 million a week on ads calling on Congress to impeach John Koskinen, the commissioner of the IRS. It seems like an odd way to spend your millions. While it’s true that the IRS is the right’s favorite whipping boy, why the campaign-style ad blitz?

Well, in my years as a prosecutor, it’s become a habit to consider motive. So it got me thinking: What motive do the Republicans have to impeach the IRS commissioner? Maybe it’s just emotional acting-out against an agency they hate because it collects the taxes they hate. Maybe it’s an outbreak of political madness.

Or maybe there is method to their madness.

Let’s look at the Republican Party and how it is funded. While it raises a healthy amount for its campaign committees, Republicans and their allies depend increasingly on the super PACs and shadowy outside spending groups made possible by the Supreme Court’s 2010 Citizens United decision. ...

An under-funded and harried IRS has been unwilling to police the activities of powerful social welfare groups after an effort to separate out new applicants blew up in its face. In 2013, the IRS signaled it would begin the process of drafting a rule to better enforce our laws limiting dark money in elections. It later put the rulemaking process on hold after an especially loud outcry from conservative groups. The agency also came under heavy fire in the press from conservatives and Republicans in Congress who feared having the hose to their political oxygen crimped. And since Republicans took control of the House of Representatives in 2011, they’ve worked to slash the IRS budget. Funding in 2016 was $11.2 billion, or 17 percent below 2010 levels, adjusted for inflation.

So the dark-money floodgates remain wide open, deluging our politics in special-interest slime.

The GOP’s crusade against Commissioner Koskinen may seem overblown, but it makes a lot of sense when you consider motive: Republicans need dark money, and dark money needs a cowering IRS.

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October 28, 2016 in IRS News, IRS Scandal, Political News, Tax | Permalink | Comments (2)

Thursday, October 27, 2016

Yale Student Newspapers Risk 501(c)(3) Tax-Exempt Status To Endorse Hillary Clinton; 94% Of Yale Profs' Political Donations Go To Democrats, 95% Of Conservative Students Feel Their Opinions Are Unwelcome At Yale

YHRCDaily Caller, Tax-Exempt Yale Daily News Appears To Violate Law By Endorsing Hillary Clinton:

The Yale Daily News appears to have violated tax laws by endorsing Hillary Clinton on Wednesday, despite being prohibited from doing so as a tax-exempt 501(c)3 organization.

Yale Daily News, News’ View: Hillary Clinton Law ’73 for President:

In 1969, the same year Yale College went coed, a young woman entered Yale Law School. Like many of us, she was an idealist: She took on child abuse cases and provided free legal advice to the poor. Like many of us, she was a go-getter who worked at the Child Study Center and conducted research on migrant labor. Long before she became Secretary of State Hillary Clinton LAW ’73, Hillary Diane Rodham was working to make our country a better place. Almost four decades later, the News is proud to endorse her for president.

We do not endorse Clinton solely because of the disqualifying flaws of her opponent, Donald Trump, whose campaign has disgusted and astonished our board. Indeed, our endorsement of Clinton should come as no surprise: A recent survey conducted by the News found that a vast majority of students support her candidacy. We endorse her because we, as young people, recognize this election is a turning point for our country. And the choice couldn’t be more clear.

Voting for Clinton is our obligation to ourselves and to future generations. ... Like the young woman who arrived in New Haven in 1969, we have the power to realize a different future. That power lies in our vote. Let’s use it to elect Hillary Clinton.

Independent Journal Review, Non-Profit Yale Record Magazine Taunts IRS With Editorial 'Not Endorsing' Hillary Clinton:

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October 27, 2016 in Political News, Tax | Permalink | Comments (5)

Monday, October 24, 2016

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)

Saturday, October 15, 2016

Presidential Campaign Tax News

Friday, October 14, 2016

Trump's Estate Tax Plan Would Raise GDP, Incomes By 1%; Clinton's Would Shrink GDP, Incomes By 1%

Clinton TrumpWall Street Journal op-ed: Killing the Death Tax Would Resurrect Growth, by Stephen J. Entin (Tax Foundation):

The death tax is an inevitable point of disagreement in a presidential campaign. Donald Trump would eliminate it to promote growth. Hillary Clinton would raise it—up to 65%, while lowering the exemption for estates to $3.5 million—to promote equality. The outcomes would be as different as their intentions. ...

Analysts at the Tax Foundation, where I work, have run the numbers using two models: one of the estate tax, based on historical filings, and another to estimate the economic effects on capital formation, GDP, profits, wages and federal revenue from those sources.

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October 14, 2016 in Political News, Tax | Permalink | Comments (16)

Tuesday, October 11, 2016

Presidential Campaign Tax News

Donald Trump And Hillary Clinton: I've Had The Time of My Life

Monday, October 10, 2016

Trump's Accountant/Lawyer Committed 'Grievous' Violation Of Legal And Professional Ethics In Discussing His Tax Returns With Media

Following up on Saturday's post, Trump’s Ex-Accountant Jack Mitnick: He’s No Tax Genius:  National Review, Confidentially Yours:  Even a Scoundrel Like Trump Deserves Ethical Legal Representation:

Is there anyone concerned at the ugly turn the election has taken with the release of a few pages of Donald Trump's taxes from 1995? The ugliness is not that Trump's taxes have been revealed, per se, but that it was done, in part it appears, by getting an elderly lawyer to violate his duty of confidentiality to his client. One might say that Trump deserves what he gets. But in this age of ever-eroding privacy, it is alarming when the official rules meant to guard privacy come under assault. ...

Mr. Mitnick has committed a grievous violation of legal and professional ethics.

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October 10, 2016 in Political News, Tax | Permalink | Comments (6)

Saturday, October 8, 2016

Trump’s Ex-Accountant Jack Mitnick: He’s No Tax Genius

The Daily Beast, Trump’s Ex-Accountant Jack Mitnick: He’s No Tax Genius:

This past week, Donald Trump's campaign surrogates attempted to argue that the candidate is a "genius" for turning a nearly $1 billion loss into a tax avoidance strategy for up to 18 years. But now the accountant who compiled Trump's 1995 tax return — and helped verify it for The New York Times — has refuted that narrative in a series of interviews. Jack Mitnick, who handled Trump's taxes until 1996, told Inside Edition on Tuesday, “I did all the tax preparation. He never saw the product until it was presented to him for signature." Pushing back at Trump's own suggestion that he "brilliantly" used tax laws to his own advantage, Mitnick added, “I’m the one who did all the work."

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October 8, 2016 in Political News, Tax | Permalink | Comments (7)

Thursday, October 6, 2016

How Hillary Clinton And Donald Trump Would Tax The 1 Percent

Vox, How Hillary Clinton and Donald Trump Would Tax the 1 Percent, in One Chart:

On Monday, Marc Goldwein of the Committee for a Responsible Federal Budget shared an updated analysis of how each candidate’s tax plans would affect the top 1 percent of American income earners:


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October 6, 2016 in Political News, Tax | Permalink | Comments (1)

Aprill & Mayer:  The Relationship Between The Trump Foundation And Trump’s Tax Returns

AM4TaxProf Blog op-ed:  Assigning a Tax Lesson: The Relationship between the Trump Foundation and Trump’s Tax Returns, by Ellen P. Aprill (Loyola) & Lloyd Hitoshi Mayer (Notre Dame):

As the debate between the Vice Presidential candidates Wednesday night made clear, Donald Trump’s refusal to release his tax returns remains an important campaign issue. The extraordinary tax losses that Donald J. Trump reportedly had in 1995 emphasize the need for him to fully disclose his tax returns for all years from then forward. Without disclosure of his federal income tax returns, we cannot begin to evaluate fully his claim on Tuesday that he has “legally” and “brilliantly” complied with all of our complicated tax laws.

The ongoing tax issues relating to his foundation came to light only because of the required disclosure of those returns. Those issues — and the foundation’s failure to register to solicit charitable contributions that has now resulted in a cease and desist order from the New York Attorney General — seem to demonstrate a woeful ignorance of the applicable law or a complete disregard of it, either of which would be of even greater concern if also reflected in his personal and business tax positions. And at least one issue raised by the foundation’s tax filings can be resolved only with full disclosure of Mr. Trump’s personal tax situation.

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October 6, 2016 in Political News, Tax | Permalink | Comments (4)

Wednesday, October 5, 2016

More Trump Tax News

Tuesday, October 4, 2016

Clinton, Obama, Trump, And Congress Wage Estate Tax War

The Hill, War Over the Estate Tax Returns:

Battles are flaring over the estate tax, with the issue receiving increased attention from the presidential candidates, the Obama administration and Congress.

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October 4, 2016 in Political News, Tax | Permalink | Comments (3)

More Trump Tax News

Following up on my posts (here and here):  The Daily Beast: Art of the Steal: This is How Trump Lost $916M and Avoided Tax, by David Cay Johnston:

The big New York Times scoop that Donald Trump used $916 million of tax losses to enjoy many income tax-free years raised a question the newspaper didn’t try to answer: How did Trump do it?

Trump, the only major-party presidential nominee in four decades to keep all his tax returns secret, insists “there’s nothing to learn from them.”

Yet in one day I figured out how Trump’s advisers almost certainly arranged the massive tax losses, skipped out on a massive income-tax bill, and then fashioned a loophole with more valuable tax benefits than the already liberal tax breaks Congress gives big real-estate owners while sticking others with the bill.

Trump dumped the real costs of all this on investors who saw gold in his brand name, but who lost everything even as he was paid tens of millions of tax-free dollars.

All this came from subtle clues on the front pages of Trump’s 1995 Connecticut, New Jersey, and New York state income-tax returns. Which sums were on which lines in each state pointed to how Trump must have organized his affairs. Two of the most respected tax professors in America agree with my analysis. Edward Kleinbard of the University of Southern California and Martin J. McMahon Jr. of the University of Florida refined my view.

New York Times: The Trump Campaign’s Questionable Tax Return Justification, by Gretchen Morgenson:

Did Donald J. Trump have a fiduciary duty to keep the amount he personally owes in taxes to a minimum?

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October 4, 2016 in Political News, Tax | Permalink | Comments (7)

Monday, October 3, 2016

How The Left (NY Times) And Right (WSJ) View Sunday's Trump Tax Tempest

Trump Tax Return

Following up on yesterday's post, NY Times: Trump Reported $916 Million Tax Loss In 1995, Perhaps Resulting In Zero Tax Liability For 18 Years Under NOL Rules:

New York Times, How Donald Trump Turned the Tax Code Into a Giant Tax Shelter:

Now we know: Donald J. Trump racked up losses so huge in the early 1990s that he wouldn’t have had to pay federal or New York State income tax on nearly a billion dollars in income. ...

It’s hard to imagine a starker contrast with the vast number of Americans who struggle to both pay taxes and make ends meet, or a more damning indictment of a tax code that makes that possible.

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October 3, 2016 in Political News | Permalink | Comments (9)

Sunday, October 2, 2016

NY Times:  Trump Reported $916 Million Tax Loss In 1995, Perhaps Resulting In Zero Tax Liability For 18 Years Under NOL Rules

Trump Tax Return

New York Times, Trump Tax Records Obtained by The Times Reveal He Could Have Avoided Paying Taxes for Nearly Two Decades:

Donald J. Trump declared a $916 million loss on his 1995 income tax returns, a tax deduction so substantial it could have allowed him to legally avoid paying any federal income taxes for up to 18 years, records obtained by The New York Times show.

The 1995 tax records, never before disclosed, reveal the extraordinary tax benefits that Mr. Trump, the Republican presidential nominee, derived from the financial wreckage he left behind in the early 1990s through mismanagement of three Atlantic City casinos, his ill-fated foray into the airline business and his ill-timed purchase of the Plaza Hotel in Manhattan.

Tax experts hired by The Times to analyze Mr. Trump’s 1995 records said that tax rules especially advantageous to wealthy filers would have allowed Mr. Trump to use his $916 million loss to cancel out an equivalent amount of taxable income over an 18-year period.

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October 2, 2016 in Political News, Tax | Permalink | Comments (26)

Friday, September 30, 2016

Tax Profs Weigh In On The Trump Foundation's Tax Issues

Washington Post, How Donald Trump Retooled His Charity to Spend Other People’s Money:

Trump 2

New York Times op-ed: An Uncharitable Foundation, by Linda Sugin (Fordham):

In addition to being the Republican nominee for president, Donald J. Trump is president of the relatively small Donald J. Trump Foundation and chairman of the relatively large Trump Organization. Although the foundation is a charitable organization, it appears to have been used for less than charitable purposes.

According to exhaustive reporting by David A. Fahrenthold of The Washington Post, Mr. Trump may have used the foundation to pay expenses for his business, to buy himself gifts and to make a political contribution. These things are all clearly prohibited under both federal and state charities law. No competent lawyer would advise a charitable foundation that such payments were allowable, and only someone with no respect for charity would so flagrantly violate these basic rules. ...

Americans who give to, volunteer with, or depend on charities should know that politicking and self-dealing by charities are never acceptable. The candidate’s apparent disregard for the law does not bode well for a Trump administration.

Slate:  What Is the Trump Foundation? It’s Supposed To Be A Charity. It Looks A Lot More Like A Personal Piggy Bank, by Adam Chodorow (Arizona State) 

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September 30, 2016 in Political News, Tax | Permalink | Comments (8)

Tuesday, September 27, 2016

Hillary Clinton's Proposed 65% Estate Tax Rate Causes Dilbert Creator Scott Adams To Switch His Endorsement To Trump

TrumpFollowing up on Friday's post, Hillary Clinton Proposes Raising Estate Tax Rate From 40% To 65%:, Why I Switched My Endorsement from Clinton to Trump:

As most of you know, I had been endorsing Hillary Clinton for president, for my personal safety, because I live in California. It isn’t safe to be a Trump supporter where I live. And it’s bad for business too. But recently I switched my endorsement to Trump, and I owe you an explanation. So here it goes.

Clinton proposed a new top Estate Tax of 65% on people with net worth over $500 million. Her website goes to great length to obscure the actual policy details, including the fact that taxes would increase on lower value estates as well. See the total lack of transparency here, where the text simply refers to going back to 2009 rates. It is clear that the intent of the page is to mislead, not inform.

So don’t fall for the claim that Clinton has plenty of policy details on her website.

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September 27, 2016 in Political News, Tax | Permalink | Comments (14)

Monday, September 26, 2016

Batchelder:  Trump Plan Raises Taxes For Millions Of Low- And Middle-Income Families

Trump (2016-2)Lily L. Batchelder (NYU), Families Facing Tax Increases Under Trump's Latest Tax Plan:

Donald Trump’s latest tax plan would cost more than $5 trillion over 10 years. Trump claims his plan would cut taxes for every income group, with the largest tax cuts for working- and middle-class families. But despite its enormous price tag, his plan would actually significantly raise taxes for millions of low- and middle-income families with children, with especially large tax increases for working single parents.

This paper explains why Trump’s latest tax plan raises taxes on so many families and provides examples of how large these tax increases would be. I conservatively estimate that Trump’s plan would increase taxes for roughly 7.8 million families with minor children. These families who would pay more taxes represent roughly 20% of households with minor children and more than half of single parents. They include roughly 25 million individuals and 15 million children.

Washington Post, A New Study Says Trump Would Raise Taxes for Millions. Trump’s Campaign Insists He Won’t.:

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September 26, 2016 in Political News, Scholarship, Tax | Permalink | Comments (2)

Friday, September 23, 2016

Hillary Clinton Proposes Raising Estate Tax Rate From 40% To 65%

Clinton KaineWall Street Journal, Hillary Clinton Proposes 65% Top Rate for Estate Tax:

Democratic presidential candidate Hillary Clinton would levy a 65% tax on the largest estates and make it harder for wealthy people to pass appreciated assets to their heirs without paying taxes, expanding the list of tax increases she would impose on the top sliver of America’s affluent.

The estate-tax increase and other new proposals that Mrs. Clinton detailed on Thursday would generate $260 billion over the next decade, enough to pay for her plans to simplify small business taxes and expand the child tax credit, according to the nonpartisan Committee for a Responsible Federal Budget [more here], which advocates fiscal restraint.

In all, Mrs. Clinton would increase taxes by about $1.5 trillion over the next decade, increasing federal revenue by about 4%, though that new burden would be concentrated on relatively few households. There is at least a $6 trillion gap between her plan and the tax cuts proposed by her Republican rival Donald Trump.

The Clinton campaign changed its previous plan—which called for a 45% top rate—by adding three new tax brackets and adopting the structure proposed by Sen. Bernie Sanders of Vermont during the Democratic primaries. She would impose a 50% rate that would apply to estates over $10 million a person, a 55% rate that starts at $50 million a person, and the top rate of 65%, which would affect only those with assets exceeding $500 million for a single person and $1 billion for married couples.


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September 23, 2016 in Political News, Scholarship, Tax | Permalink | Comments (6)

Thursday, September 22, 2016

Utah Law Prof: Impeach Trump Immediately If He Beats Clinton

Trump (2016-2)Christopher Peterson (Utah), Trump University and Presidential Impeachment:

In the final weeks of the 2016 Presidential campaign Donald J. Trump faces three lawsuits accusing him of fraud and racketeering. These ongoing cases focus on a series of wealth seminars called “Trump University” which collected over $40 million from consumers seeking to learn Trump’s real estate investing strategies. Although these consumer protection cases are civil proceedings, the underlying legal elements in several counts that plaintiffs seek to prove run parallel to the legal elements of serious crimes under both state and federal law. This essay provides a legal analysis of whether Trump’s alleged behavior would, if proven, rise to the level of impeachable offenses under the presidential impeachment clause of the United States Constitution.

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September 22, 2016 in Legal Education, Political News, Scholarship | Permalink | Comments (9)

Tuesday, September 20, 2016

Trump Violated Tax Law In Using $258,000 From His Charity to Settle Legal Problems

Trump (2016-2)Washington Post, Trump Used $258,000 From His Charity to Settle Legal Problems:

Donald Trump spent more than a quarter-million dollars from his charitable foundation to settle lawsuits that involved the billionaire’s for-profit businesses, according to interviews and a review of legal documents.

Those cases, which together used $258,000 from Trump’s charity, were among four newly documented expenditures in which Trump may have violated laws against “self-dealing” — which prohibit nonprofit leaders from using charity money to benefit themselves or their businesses.

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September 20, 2016 in Political News, Tax | Permalink | Comments (6)

Sunday, September 18, 2016

Trump Tax Plan 3.0

Friday, September 16, 2016

NY Times:  Tax Lawyers — The Big Winners In Hillary Clinton’s 'Fiendishly Complicated' Tax Plan

Clinton KaineNew York Times: One Beneficiary of Clinton’s Complex Tax Plan: Tax Lawyers, by James B. Stewart:

It’s hard to imagine a tax code more complicated than the one we already have.

Hillary Clinton has come up with one.

“This isn’t tax reform,” said Douglas Holtz-Eakin, an economist who served as director of the Congressional Budget Office and is now president of the American Action Forum, a conservative, pro-growth advocacy group. “It’s anti-reform. She’s layering on even more complexity.”

His views were echoed by a number of tax experts I spoke to this week about Mrs. Clinton’s tax plans, as I did earlier about Donald J. Trump’s.

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September 16, 2016 in Political News, Tax | Permalink | Comments (3)

Saturday, September 3, 2016

NY Times:  If Trump Gets His Way, Real Estate Will Get Even More Tax Breaks

Trump (2016-2)New York Times: If Trump Gets His Way, Real Estate Will Get Even More Tax Breaks, by James B. Stewart:

It’s hard to imagine a tax code more favorable to real estate developers than the one we already have.

Donald Trump has come up with one.

Thanks to some major loopholes in the existing tax code that treat real estate developers as a special privileged class, it’s entirely possible (even likely) that Mr. Trump pays little or no federal income tax.

But Mr. Trump’s new tax proposal doesn’t just preserve those breaks, it piles on new ones for real estate developers like Mr. Trump himself — at an estimated cost of more than $1 trillion in tax revenue over a decade.

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September 3, 2016 in Political News, Tax | Permalink | Comments (0)

Friday, August 26, 2016

Mike Pence, Law School Cartoonist

Thursday, August 25, 2016

More On Donald Trump's Tax Returns

Clinton, Trump, Taxes, And Silicon Valley

Silicon ValleyBloomberg: Trump’s Offshore Tax-Cut Pitch Falls Flat in Silicon Valley, by Lynnley Browning:

Republican Donald Trump is proposing a big tax cut for companies like Apple Inc., which would see its tax rate slashed on about $200 billion of profit it keeps offshore. Yet Apple’s boss is co-hosting a fundraiser on Wednesday for Trump’s Democratic opponent for the White House.

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August 25, 2016 in Political News, Tax | Permalink | Comments (0)

Tuesday, August 23, 2016

Clinton Proposes Small Business Standard Tax Deduction

Hillary Logo (2016)Factsheet, Hillary Clinton Will Make Life Easier for Small Business at Every Step of the Way:

Work to create a new standard deduction for small businesses—like the one available to individual filers. This proposal will vastly simplify filing for small businesses and entrepreneurs—whether they’re running a business out of their own home, managing a shop on Main Street, or selling online through platforms like Etsy and eBay. Rather than having to track and file forms documenting their overhead costs—potentially including transportation, computer and phone use, maintaining an office, and more—a small business would be offered the option of taking a single, simple deduction. Hillary will ask her Treasury Department to bring together small business owners and leading experts to design this new standard deduction, including its limits and parameters, which existing expenses could voluntarily be replaced, and measures to prevent gaming and abuse—all to advance the goal of making it far easier for small businesses to file their taxes. This proposal would be focused on true small businesses, with restrictions preventing larger businesses or high-income taxpayers from claiming it. Small businesses could still opt to track and deduct their expenses individually, just like individual filers.

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August 23, 2016 in Political News, Tax | Permalink | Comments (0)

Sunday, August 21, 2016

Clinton, Trump Tax Plan News

Thursday, August 18, 2016

NY Times:  Hillary Clinton Twists The Knife In Donald Trump’s Tax Proposals

Hillary Trump (2016)New York Times, Hillary Clinton Twists the Knife in Donald Trump’s Tax Proposals:

Hillary Clinton leaned into her plans to raise taxes on the wealthiest Americans on Wednesday, denouncing Donald J. Trump’s tax proposals as a boondoggle for billionaires.

“We’re going to tax the wealthy who have made all of the income gains in the last 15 years,” Mrs. Clinton told a crowd in Cleveland. “The superwealthy, corporations, Wall Street,” she declared emphatically, “they’re going to have to invest in education, in skills training, in infrastructure.”

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August 18, 2016 in Political News, Tax | Permalink | Comments (1)

Tuesday, August 16, 2016

Clinton v. Trump: What Happens To Your Income Taxes?

Hillary Trump (2016)David Cay Johnston, Clinton vs. Trump: What Happens to Your Income Taxes?:

Let’s look at a few of the more curious aspects of the Clinton and Trump plans for individual income tax now that both candidates have put out reasonably comprehensive proposals they promise to take to Congress next year. The bottom line: Clinton and Trump both offer conventional, predictable and minimally significant changes, not reform. ...

The reality is that Congress, not presidents, sets tax rules and rates. The proposals by Clinton and Trump – while quite different – are just tinkering around the edges and vote-seeking, not real reform of a system that has become so complex, burdensome and capricious in how it treats taxpayers with the same income that no politicians defend the system as it exists.

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August 16, 2016 in Political News, Tax | Permalink | Comments (4)

Saturday, August 13, 2016

Clinton, Trump Tax Return News

Friday, August 12, 2016

Black Lives Matter Tax Reform Plan


The Movement for Black Lives Platform: Economic Justice:

What is the problem?

  • There is a desperate need to replace  the current practice of collecting revenue in regressive ways with a more just system for collecting taxes.
  • Across the United States, there are major political obstacles to raising any kind of revenue.
  • As with most faults in our economic and political systems, regressive taxation has hit Black people, low-income people, and people of color the hardest.
  • Many municipalities have resorted to privatization and new taxes and fees in order to save money and generate more revenue. As a result, residents are being forced to pay more for services like trash collection, sewage, public property maintenance, parking meters, and to pay new taxes on a variety of everyday goods.
  • A recent study conducted by the Institute on Taxation and Economic Policy found that when one combines all the state and local income, property, sales and excise taxes that Americans pay, the nationwide average of effective state and local tax rates are 10.9 percent for the poorest fifth of taxpayers, and 5.4 percent for the wealthiest 1 percent.
  • In the ten states with the most regressive tax structures, the poorest fifth pay up to seven times as much in taxes and fees as the wealthiest residents, as a percentage of their income.
  • While states sometimes shift the cost of some services onto poorer residents, at other times they simply cut services all together. Many municipalities have had to increase public school class sizes, shorten school days, close vital city offices, and eliminate a huge number of public sector jobs.
  • As the wealthiest Americans and most powerful corporations continue to evade their fair share of taxes, many programs and initiatives that could contribute to racial and economic justice go underfunded or unfunded.

What does this solution do?

  • Taxing income:
  • Raise marginal tax rates for high earners, specifically the top percentile (for equity and revenue generation reasons —they pay more than 40 percent of federal income tax revenue, yet their average rate has been reduced to around 20 percent) and begin by gradually raising the top marginal rate first to 50 percent and then up to 80 percent.
  • Remove income caps on payroll taxes that fund social security and unemployment insurance.
  • Raise corporate income taxes, especially on large corporations and end tax deferral for foreign income of multinational corporations.
  • Taxing wealth:
  • Increase taxes on capital to the point where they are higher than taxes on labor, as wealth inequality is greater than income inequality. Specifically:
  • Increase capital gains tax
  • Create anti-speculation tax on property transfers
  • Increase estate tax
  • Have states shift to an income-sensitized property tax that focuses on homes above a certain threshold and second homes
  • Impose a wealth tax (on tangible and financial assets)

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August 12, 2016 in Political News, Tax | Permalink | Comments (9)

Tuesday, August 9, 2016

Trump Tax Plan 2.0

Trump Tax Plan

Donald Trump yesterday unveiled dramatic changes in his original tax plan, embracing the plan announced by House Speaker Paul Ryan in June (critiqued here).

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August 9, 2016 in Political News, Tax | Permalink | Comments (3)

Monday, August 8, 2016

Kleinbard:  The Real Reason Trump Won't Release His Tax Returns

Trump (2016)The Hill: Trump’s Pushback on Tax Return Release Reveal True Ambitions, by Edward Kleinbard (USC):

With his nomination secure, Donald Trump has made it clear that he will not release his tax returns. Democrats have responded with outrage, and even bounties for their publication, while Trump supporters scramble to explain why this time is different, and the returns should remain confidential. Trump’s refusal already is costing him in the polls, and the issue will only grow as the election approaches.

So why has Mr. Trump staked out this politically unpalatable position? The answer lies not in any sordid details that Trump’s tax returns might reveal, but rather in what the refusal itself says about the man and his ambitions.

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August 8, 2016 in Political News, Tax | Permalink | Comments (7)

Sunday, August 7, 2016

At Harvard Law School, Tim Kaine Was Driven By Faith

KaineThe Boston Globe, At Harvard Law, Tim Kaine Was Driven by Faith:

He was a year younger than most of his classmates, a state-school graduate and devout Catholic from the Midwest suddenly surrounded by Ivy Leaguers on a secular East Coast campus.

It was clear, when Tim Kaine arrived at Harvard Law School in the fall of 1979, that he was not exactly in his natural element. And it didn’t take long for him to lose faith in his chosen field on the cutthroat camp“

He had a crisis of purpose during his first year in law school when he realized most of his fellow classmates went on to become corporate lawyers with practices and principles with which he didn’t agree,” said Scott Brown, a New Hampshire energy investor who met Kaine on their first day of law school. “I encouraged him to veer off.”us of career-minded law students.

Kaine’s bumpy years at Harvard helped clarify what he wanted — and didn’t want — in life, friends said, and introduced him to some of the issues, like the death penalty, that he would later confront as a governor, senator, and, now, Democratic vice presidential nominee.

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August 7, 2016 in Legal Education, Political News | Permalink | Comments (7)

Wednesday, August 3, 2016

Trump Wants To Repeal The Johnson Amendment And Make Churches The New Super PACs

Following up on my previous posts (here and here):  The Atlantic, Trump Wants to Make Churches the New Super PACs: His Promise to Repeal the 1954 Johnson Amendment Isn’t About Free Speech—It’s About Cash:

Why have some religious conservatives decided to support Donald Trump for United States president? Leaders have named their reasons: He’s promised toappoint pro-life Supreme Court justices; he’s allegedly good at business. But they have also consistently cited something else, perhaps more unexpected: the tax code.

Trump has promised to repeal the so-called Johnson Amendment, a 1954 provision that prohibits tax-exempt organizations from participating in political activities. Proposed by then-Senator Lyndon B. Johnson and later revised by Congress, it keeps churches and other non-profits from lobbying for specific causes, campaigning on behalf of politicians, and supporting or opposing candidates for office.

While opponents of the Johnson Amendment often frame their objections in terms of free speech, the provision’s primary impact may be financial. Right now, the IRS makes a clear distinction between non-profit groups—from charities and universities to certain private schools and houses of worship—and political organizations.

If the Johnson Amendment were repealed, pastors would be able to endorse candidates from the pulpit, which they’re currently not allowed to do by law. But it’s also true that a lot more money could possibly flow into politics via donations to churches and other religious organizations. That could mean religious groups would become much more powerful political forces in American politics—and it would almost certainly tee up future court battles. ...

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August 3, 2016 in Political News, Tax | Permalink | Comments (9)

Tuesday, August 2, 2016

NY Times:  Donald Trump Ducks Tax Disclosure

Trump (2016)New York Times editorial, Donald Trump Ducks Tax Disclosure:

As Donald Trump’s tweets pile one atop another, generating sensational headlines, issues of true substance are tending to get lost in the shuffle. None is more important for voters to keep in mind than the failure of Mr. Trump to disclose his full income tax returns, something he is not likely to do by Election Day.

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August 2, 2016 in Political News, Tax | Permalink | Comments (1)

Saturday, July 30, 2016

Hillary Clinton Moves Left On Taxes

ATRPolitico, Morning Tax: Corporate Tax Left in the Lurch?:

Hillary and Corporate Taxes, Cont'd:
Is that sound you hear the Democratic Party moving left on taxes?

Neera Tanden, a key adviser to Democratic nominee Hillary Clinton, scoffed in Philadelphia at the idea that the corporate tax rate needs a cut — noting that companies’ bottom lines seem to be doing just fine, even with the top rate of 35 percent, and suggesting that average Americans aren’t concerned over whether corporations get a lower rate.

Republicans have knocked President Barack Obama for not really having his heart in tax reform, but this White House did release a framework to reduce the corporate rate to 28 percent. (Manufacturers would have the chance to get down to 25 percent.)

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July 30, 2016 in Political News, Tax | Permalink | Comments (0)

Wednesday, July 27, 2016

Chodorow & Johnston:  Trump's Wrong-Headed Call For Tax-Subsidized Politicization Of The Pulpit

Trump (2016)Following up on Sunday's post, Trump's Call To Repeal The Johnson Amendment And Allow Churches To Endorse Political Candidates:  

Adam Chodorow (Arizona State), Donald Trump Wants to Politicize the Pulpit:

One of the biggest applause lines of the Republican convention was Donald Trump’s call to repeal the so-called Johnson Amendment, which, among other things, conditions churches’ tax-exempt status on ministers refraining from political speech at their pulpits. Critics such as Trump argue that ministers have First Amendment speech rights, which they say the government is infringing by restricting religious organizations in this manner. ...

In truth, it’s a lot more complicated than that. With Trump, it always is. Because on closer inspection, it’s clear that the Johnson Amendment, made law in 1954, serves an important function: preventing the government from subsidizing political speech. And repealing the law could lead to more entanglement of church and state—not less. ...

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July 27, 2016 in Political News, Tax | Permalink | Comments (1)

Sunday, July 24, 2016

Trump's Call To Repeal The Johnson Amendment And Allow Churches To Endorse Political Candidates

Friday, July 22, 2016

Trump Family Would Get $7 Billion Windfall From Estate Tax Plan

Trump (2016)The Hill, Trump Family Would Get $7B Windfall From Estate-Tax Plan: Analyst:

Donald Trump's family would get a $7.1 billion tax cut under the Republican presidential nominee's proposal to eliminate the federal estate tax, a centrist think tank estimated.

"The staggeringly high value of the tax cut for the Trump dynasty alone carries the same price tag as multiple high-value national priorities," Third Way said in an analysis Wednesday.

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July 22, 2016 in Political News, Tax | Permalink | Comments (5)

New York Terminates The Tampon Tax

TamponFollowing up on my previous posts:

Newsweek, New York Terminates the Tampon Tax:

There are plenty of things you can buy in the U.S. tax-free: bagged salads in Colorado, seasoned croutons in Texas, manicures and massages in West Virginia. But in 40 states, menstrual products—used to care for a normal bodily function that occurs every month, for 30 to 40 years—are taxed anywhere from 4 to 10 percent. Meanwhile, we can all participate in rodeos tax-free (thanks, South Dakota!)

On Thursday, however, New York became the 11th state without a tax on menstrual products when Governor Andrew Cuomo signed legislation eliminating local and state sales taxes on them.

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July 22, 2016 in Political News, Tax | Permalink | Comments (0)

Tuesday, July 19, 2016

Johnston:  Donald Trump And Kids Named In $250m Tax Scam

Trump (2016)The Daily Beast:  Donald Trump and Kids Named in $250M Tax Scam, by David Cay Johnston:

Four Donald Trump-licensed real-estate developments are at the center of a huge income tax evasion scheme, according to allegations in a lawsuit unsealed Thursday afternoon by a judge in Manhattan.

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July 19, 2016 in Political News, Tax | Permalink | Comments (6)

Sunday, July 17, 2016

IRS Rejects 501(c)(3) Status For DNC Convention As Too Partisan, Causing Donors To Pull Out Due To Lost Deductions; DNC Devises Workaround To Funnel Contributions Through Philadelphia Convention Bureau

DNCFollowing up on my previous posts (here and here):  Philadelphia Inquirer:  Turned Down by the IRS, Philly's DNC Host Committee Goes for Plan B:

The IRS has turned down the long-running effort by the Democratic convention's Philadelphia host committee to win a tax exemption.

Word of the decision, a setback for efforts to raise the last of the $60 million needed to help pay for the July 25 to 28 convention, came Friday from its adviser, David L. Cohen.

When the decision came - and why - is less clear. Cohen would say only that the IRS "recently" turned down the application for tax-exempt status under section 501(c)3 of the tax code, which the committee had sought for more than a year.

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July 17, 2016 in Political News, Tax | Permalink | Comments (6)

Wednesday, July 13, 2016

NY Times Debate:  Was It Proper For Justice Ginsburg To Denounce Trump?

NY Times Room for DebateNew York Times Room For Debate, Can a Supreme Court Justice Denounce a Candidate?:

“I can’t imagine what this place would be — I can’t imagine what the country would be — with Donald Trump as our president,” Supreme Court Justice Ruth Bader Ginsburg said in an interview on Friday. Trump’s election would have led her late husband to say, “‘Now it’s time for us to move to New Zealand,’” she added.

Her comments raised eyebrows even among her fans in the legal community. Is it ever appropriate for justices to announce a partisan position in an election?

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July 13, 2016 in Legal Education, Political News | Permalink | Comments (11)

Thursday, July 7, 2016

DNC Lacks 501(c)(3) Exemption For Philadelphia Convention, Putting Donors' Charitable Deductions At Risk

DNCFollowing up on my previous post:  Philadelphia Inquirer, With DNC Just Weeks Away, Host Committee Still Waiting for Green Light From IRS:

The local fund-raising committee for the Democratic National Convention still has not received tax-exempt status from the IRS, and that could affect donors who want tax deductions.

The Philadelphia 2016 Host Committee, which is responsible for raising at least $60 million for the July 25 to 28 convention at the Wells Fargo Center, has not received the designation under section 501(c)3 of the tax code.

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July 7, 2016 in Political News, Tax | Permalink | Comments (5)

Tuesday, June 28, 2016

Why Won't Donald Trump Release His Tax Returns?

Vanity FairVanity Fair: The Great Trump Tax Mysteries: Is He Hiding Loopholes, Errors, or Something More Serious?, by Nicholas Shaxson:

Why won’t Donald Trump release his taxes? An investigation into the G.O.P. candidate’s finances—the extensive deductions he could claim, the F.E.C. filings from his Scottish and Irish golf resorts, and his declarations to the British government—reveals a disturbing pattern of mistakes, hype, and contradictions.

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June 28, 2016 in Political News, Tax | Permalink | Comments (5)

Monday, June 20, 2016

Trump Did Not Pay Any Taxes In At Least Five Years

Trump (2016)Politico Morning Tax, Make it Five:

Drip, Drip, Drip:  Well, there’s another two years that Donald Trump didn’t pay any taxes.

Politico's Shane Goldmacher, relying on New Jersey gambling records while Trump continues to keep his returns private, found out that it doesn’t look like Trump had any tax liability in 1991 or 1993. That means there’s now at least five reported years over the last four decades that Trump didn’t pay any taxes, counting also 1978 and 1979 (per The Washington Post) and 1984 (via the Daily Beast).

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June 20, 2016 in Political News, Tax | Permalink | Comments (3)