TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Tuesday, April 25, 2017

Slemrod Presents Taxing Hidden Wealth: The Consequences Of U.S. Enforcement Initiatives On Evasive Foreign Accounts At NYU

Slemrod (2017)Joel Slemrod (Michigan) presented Taxing Hidden Wealth: The Consequences of U.S. Enforcement Initiatives on Evasive Foreign Accounts (with Niels Johannesen (Copenhagen), Patrick Langetieg (IRS), Daniel Reck (UC-Berkeley) & Max Risch (Michigan)) at NYU yesterday as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Rosanne Altshuler:

Beginning in 2009, the IRS initiated a series of enforcement efforts to curb the use of offshore accounts to facilitate tax evasion, along with a voluntary disclosure program to encourage individuals with foreign accounts to become compliant with tax law. This paper examines the impact of increased enforcement activity on U.S. taxpayers’ statements of foreign accounts and reported income on tax returns. We find that enforcement initiatives increased the number of individuals reporting foreign accounts to the IRS by at least 19 percent, and they increased total wealth disclosed by at least $75 billion.

Continue reading

April 25, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Bank, Cheffins & Wells:  Executive Pay—What Worked?

Steven A. Bank (UCLA), Brian R. Cheffins (Cambridge) & Harwell Wells (Temple), Executive Pay: What Worked?,  42 J. Corp. L. 59 (2016):

CEO pay is a controversial issue in America but there was a time, often overlooked today, when chief executives were not paid nearly as much as they are now. From 1940 to the mid-1970s executive pay was modest by today’s standards even though U.S. business was generally thriving. What worked to keep executive pay in check? Economist Thomas Piketty and others credit high marginal income tax rates, leading to calls for a return to a similar tax regime. This paper casts doubt on the impact tax had and also shows that neither the configuration of boards nor shareholder activism played a significant role in constraining executive pay. It emphasizes instead the roles played by strong unions, a different and more circumscribed market for managerial talent, and social norms, explanations that do not easily lend themselves to generating modern policy prescriptions.

Bank

Continue reading

April 25, 2017 in Scholarship, Tax | Permalink | Comments (0)

Pittsburgh Tax Review Issues Call For Papers

Pittsburgh Tax Review (2017)With some room still remaining in its coming fall issue, the peer-reviewed Pittsburgh Tax Review invites the submission of articles and essays for publication in the journal’s Fall 2017 issue. Submissions can be sent directly to Anthony Infanti, preferably prior to June 1, 2017.

Continue reading

April 25, 2017 in Scholarship, Tax | Permalink | Comments (0)

Monday, April 24, 2017

Hemel Presents The Federalist Safeguards of Progressive Taxation Today At Pepperdine

HemelDaniel Hemel (Chicago) presents The Federalist Safeguards of Progressive Taxation, 93 NYU L. Rev. ___ (2017), at Pepperdine today as part of our Tax Policy Workshop Series funded in part by a generous gift from Scott Racine:

This essay considers the distributional consequences of the Supreme Court’s federalism jurisprudence over the past quarter century, focusing specifically on the anticommandeering, anti-coercion, and state sovereign immunity doctrines. The first of these doctrines prevents Congress from compelling the states to administer federal programs; the second prevents Congress from achieving the same result through offers that for practical purposes the states cannot refuse; the third prohibits Congress from abrogating state sovereign immunity outside a limited class of cases. These doctrines vest the states with valuable entitlements and allow the states to sell those entitlements back to Congress for a price. In this respect, the doctrines have an intergovernmental distributional effect, shifting wealth from the federal government to the states.

Continue reading

April 24, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Sunday, April 23, 2017

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 #1 paper:

  1. [355 Downloads]  Background and Current Status of FATCA, by William Byrnes (Texas A&M) & Robert J. Munro (Texas A&M)
  2. [346 Downloads]  House Plan's Bad Math: Over-Estimates of Revenue from a Border Adjustment, by David Kamin (NYU) & Brad Setser (Council on Foreign Relations)
  3. [328 Downloads]  Destination-Based Cash Flow Taxation, by Alan Auerbach (UC-Berkeley), Michael P. Devereux (Oxford), Michael Keen (IMF) & John Vella (Oxford)
  4. [216 Downloads]  The Offshore Tax Enforcement Dragnet, by Shu-Yi Oei (Tulane)
  5. [200 Downloads]  The First McGee Annual Report on the Best and Worst States for Business, by Robert W. McGee (Fayetteville State University)

April 23, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Friday, April 21, 2017

Weekly SSRN Tax Article Review And Roundup

This week, Daniel Hemel (Chicago) reviews a new article by Richard Schmalbeck (Duke), Jay Soled (Rutgers), and Kathleen DeLaney Thomas (North Carolina), Advocating A Carryover Tax Basis Regime, 93 Notre Dame L. Rev. (forthcoming 2017).

HemelCandidate Donald Trump’s campaign platform contained a cryptic line regarding the tax treatment of assets transferred at death: “The Trump Plan will repeal the death tax, but capital gains held until death and valued over $10 million will be subject to tax to exempt small businesses and family farms.” Some read that to mean Trump would treat death as a realization event; others interpreted it to mean that Trump would allow inheritors to defer capital gains tax until they sold the inherited asset, but with carryover rather than stepped-up basis. No one was quite sure how the $10 million exemption would work. Would it apply to the first $10 million in transferred assets or the first $10 million in capital gains? (Unless the decedent’s basis is zero, those two things aren’t the same.)

To help us sort through these alternatives, Richard Schmalbeck, Jay Soled, and Kathleen DeLaney Thomas have produced an excellent article arguing for a carryover basis regime and against any exemption. Soled, Thomas, and James Alm of Tulane have published two shorter pieces in Tax Notes advocating a carryover basis regime limited to marketable securities. (See Soled, Alm & Thomas, A New Carryover Tax Basis Regime for Marketable Securities, 154 Tax Notes 835 (Feb. 13, 2017); Soled, Alm & Thomas, Trump and a Populist Agenda?, 154 Tax Notes 1131 (Feb. 27, 2017).) Soled, Thomas, and Alm also have condensed their argument into an op-ed for The Hill, distilling a complicated issue of tax law into clear language comprehensible to nonlawyers.

Continue reading

April 21, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (1)

Thursday, April 20, 2017

The Taxing Power After Sebelius

Bret N. Bogenschneider (University of Surrey), The Taxing Power After Sebelius, 51 Wake Forest L. Rev. 941 (2016):

In National Federation of Independent Business v. Sebelius, the individual mandate of the Affordable Care Act was upheld under Congress’s taxing power rather than pursuant to the Commerce Clause. Although politically expedient, the salutary effect of the decision came at the expense of an undefined expansion of the taxing power. The Congressional Research Service concluded that, after Sebelius, the limits of the Congressional taxing power are unknown. Accordingly, the Congressional staff attorneys listed prior cases that ostensibly limit the taxing power and then predicted that future cases will be needed to define the limits going forward.

Continue reading

April 20, 2017 in Scholarship, Tax | Permalink | Comments (2)

Wednesday, April 19, 2017

NYU Tax Law Review Publishes New Issue

NYU Law (2016)The Tax Law Review has published a new issue (Vol. 69, No. 4 (Summer 2016)):

Continue reading

April 19, 2017 in Scholarship, Tax | Permalink | Comments (0)

Tuesday, April 18, 2017

Galle Presents Design And Implementation Of A Charitable Regulation Regime Today At Georgetown

Galle (2016)Brian Galle (Georgetown) presents Design and Implementation of a Charitable Regulation Regime at Georgetown today as part of its Tax Law and Public Finance Workshop Series hosted by John Brooks and Itai Grinberg:

Charitable organizations are often billed as private alternatives to the governmental provision of public goods (Weisbrod 1975). Yet in developed countries many aspects of charities are subject to government dictate, or at least oversight. Government rules may circumscribe, or at least incentivize, the organizational structure of the firm, the rights and obligations of its stakeholders, what activities it will engage in or not, how much it will spend or save, even to whom it will communicate and the content of those communications. In a federated system such as the United States, a single multi-state firm might be answerable to literally dozens of separate regulators.

Continue reading

April 18, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Columbia Symposium:  The House GOP Better Way To Tax Reform

Better WaySymposium, The Better Way Plan, 8 Colum. J. Tax L. 113-308 (2017):

Continue reading

April 18, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (0)

BYU And Pepperdine Are The Most Ideologically Balanced Faculties Among The Top 50 Law Schools (2013)

Adam Bonica (Stanford), Adam S. Chilton (Chicago), Kyle Rozema (Northwestern) & Maya Sen (Harvard), The Legal Academy's Ideological Uniformity:

Ideology

Continue reading

April 18, 2017 in Legal Education, Scholarship | Permalink | Comments (8)

Monday, April 17, 2017

Perry Fleischer Presents The Libertarian Case For A Universal Basic Income Today At NYU

Fleischer (Miranda)Miranda Perry Fleischer (San Diego) presents Atlas Nods: The Libertarian Case for a Universal Basic Income (with Daniel Hemel (Chicago)) at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Rosanne Altshuler: :

Proposals for a universal basic income are generating interest across the globe, with pilot experiments underway or in the works in Finland, Kenya, the Netherlands, and the city of Oakland, California. Surprisingly, many of the most outspoken supporters of a universal basic income have been self-described libertarians — even though libertarians are generally considered to be antagonistic toward redistribution and a universal basic income is, at its core, a program of income redistribution. What explains such strong libertarian support for a policy that seems so contrary to libertarian ideals?

This Article seeks to answer that question. We first show that a basic safety net is not only consistent with, but likely required by, several strands of libertarianism. We then explain why libertarians committed to limited redistribution and limited government might support a system of unconditional cash transfers paid periodically. Delivering benefits in cash, rather than in-kind, furthers autonomy by recognizing that all citizens —  even poor ones — are the best judges of their needs. Decoupling such transfers from a work requirement acknowledges that the state lacks the ability to distinguish between work-capable and work-incapable individuals. Providing payments periodically, rather than through a once-in-a-lifetime lump sum grant, ensures that all individuals can receive a minimum level of support over lifespans of variable lengths, while also allowing individuals to adjust payment flows through financial market transactions.

Continue reading

April 17, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (2)

Thomas Brennan Named Stanley Surrey Professor of Law At Harvard Law School

Harvard Law School, Focus and Perspective in Taxation: Tom Brennan receives the Stanley S. Surrey Professorship of Law:

In a lecture marking his appointment as the Stanley S. Surrey Professor of Law at Harvard Law School, Tom Brennan ’01 delivered a talk titled “Focus and Perspective in Taxation.”

Continue reading

April 17, 2017 in Legal Education, Scholarship, Tax | Permalink | Comments (0)

Sunday, April 16, 2017

The Top 5 Tax Paper Downloads

SSRN LogoThere is quite a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with new papers debuting on the list at #3, #4, and #5:

  1. [327 Downloads]  House Plan's Bad Math: Over-Estimates of Revenue from a Border Adjustment, by David Kamin (NYU) & Brad Setser (Council on Foreign Relations)
  2. [307 Downloads]  Destination-Based Cash Flow Taxation, by Alan Auerbach (UC-Berkeley), Michael P. Devereux (Oxford), Michael Keen (IMF) & John Vella (Oxford)
  3. [299 Downloads]  Background and Current Status of FATCA, by William Byrnes (Texas A&M) & Robert J. Munro (Texas A&M)
  4. [203 Downloads]  The Offshore Tax Enforcement Dragnet, by Shu-Yi Oei (Tulane)
  5. [195 Downloads]  The First McGee Annual Report on the Best and Worst States for Business, by Robert W. McGee (Fayetteville State University)

April 16, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Friday, April 14, 2017

Weekly SSRN Tax Article Review And Roundup

This week, David Gamage (Indiana) reviews a recent article by David P. Hariton (Sullivan & Cromwell), Planning for Border Adjustments: A Practical Analysis, Tax Notes, February 20, 2017.

Gamage (2017)The House Republicans’ proposal for a destination-based cash-flow tax (DBCFT) continues to inspire fascinating discussions among tax policy experts.  Important advances in our knowledge about how destination-based taxes can work, or fail to work, are occurring in real time through these discussions.  This will be my third blog entry praising a recent piece of scholarship as one of the best analyses of the DBCFT to date (see here and here for my previous entries).  Nevertheless, I hope I retain credibility in declaring Hariton’s new article to be essential reading for anyone hoping to understand how the DBCFT, or any other similar proposal reliant on federal-level border adjustments, might work in practice.

Continue reading

April 14, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Aprill:  Section 501(C)(3) Organizations, Single Member LLCs, And Fiduciary Duties

Ellen P. Aprill (Loyola-L.A.), Section 501(C)(3) Organizations, Single Member Limited Liability Companies, and Fiduciary Duties, 52 ABA Real Prop., Prob. & Tr. J. ___ (2017):

Tax-exempt organizations, including section 501(c)(3) organizations and their philanthrocapitalists, use single member limited liability companies (SMLLCs) for a variety of purposes. Exempt section 501(c)(3) nonprofit organizations (which, for convenience, I will refer to as charities) that have a number of facilities, be they schools, hospitals, or real estate investments, may form a separate SMLLC for each of them, primarily to protect other assets from liability. Charities may wish to place activities with a high risk of tort liability, such as an overnight summer camp, in its own SMLCC. SMLLCs may be used to isolate unrelated business activities from related activities. They may be used to isolate risky investments from more conservative ones. Philanthrocapitalists may structure donations through SMLLCs. They may use them to control aspects of the tax exempt entity’s activities, as according to press reports, the Koch Brothers may do with some of their noncharitable tax-exempt entities.

Continue reading

April 14, 2017 in Scholarship, Tax | Permalink | Comments (0)

Thursday, April 13, 2017

Hanna Presents The Theory And Reality Of Business Tax Reform Today At Georgetown

HannaChristopher Hanna (SMU; Senior Policy Advisor for Tax Reform, Senate Finance Committee) presents The Theory and Reality of Business Tax Reform at Georgetown today as part of its Tax Law and Public Finance Workshop Series hosted by John Brooks and Itai Grinberg:

The last several years has seen a lot of discussion among policymakers as to reforming the tax code. On the individual side, there is very little agreement on what form tax reform should take. For example, some policymakers would like to eliminate a number of exclusions, deductions and credits thereby broadening the income tax base and coupling that with a reduction in the individual statutory tax rates. Others would like to shift the current tax system to a consumption-based tax system through, for example, enactment of a value-added tax or an exemption of capital income from the tax base. Some policymakers would simply like to retain the current individual income tax system, particularly after the enactment of a higher individual statutory tax rate as part of the fiscal cliff deal in early 2013.

Continue reading

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

Gamage & Ross Present At Final Indiana Tax Policy Workshop Of The Semester

Indiana (2016)Two Indiana-Bloomington faculty are presenting papers today at the final Indiana Tax Policy Workshop of the semester:

David Gamage, Tax Cannibalization and State Government Tax Incentive Programs, 82 State Tax Notes 197 (Oct. 17, 2016) (with Darien Shanske (UC-Davis)):

States and localities offer businesses an enormous amount of tax incentives to locate within their jurisdictions despite: 1) the mass of evidence that suggests that these incentives are not particularly effective and, 2) substantial doubts about their constitutionality.

In this essay, we develop a new critical perspective on state tax incentives. We argue that offering these incentives permits states to offer lower taxes to more mobile businesses while keeping their overall corporate tax rates high. This is arguably not the best choice for the states, but it is definitely not the best choice for the federal government. Because the states share the corporate income tax base with the federal government, higher overall state corporate income tax rates results in more cannibalization of federal corporate income tax revenue.

Justin Ross, The Impact of State Taxes on Pass-Through Businesses: Evidence from the 2012 Kansas Income Tax Reform (with Jason DeBacker (Middle Tennessee State), Bradley Heim (Indiana) & Shanthi Ramnath (U.S. Treasury Department, Office of Tax Analysis)):

Continue reading

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

Wednesday, April 12, 2017

Dirty Secrets: How Tax Havens Destroy the Economy

Dirty SecretsRichard Murphy (City University, London), Dirty Secrets: How Tax Havens Destroy the Economy (2017):

The Panama Papers were a reminder of how the superrich are allowed to hide their wealth from the rest of us. Dirty Secrets uncovers the extent of the corruption behind this crisis and shows what needs to be done in the face of this unregulated spread of rampant greed.

Tax havens, we are often told, are part of the global architecture of capitalism, providing a freedom from regulation necessary to make markets work. In this book, leading authority Richard Murphy uncovers the truth behind this lie. The fact of the matter is that this increasingly popular practice threatens the foundations of democracy, sowing mistrust and creating a regime based upon opacity.

As Murphy shows, how we manage our economy is a political decision, and one that can be changed. Dirty Secrets proposes ways to regulate tax havens and what the world might look like without them.

Continue reading

April 12, 2017 in Book Club, Scholarship, Tax | Permalink | Comments (1)

Tuesday, April 11, 2017

Shaviro Presents The Relationship Between 'Legally Defensible' Tax Planning And Social Justice Today At Northwestern

Shaviro (2015)Daniel Shaviro (NYU) presents Interrogating the Relationship between 'Legally Defensible' Tax Planning and Social Justice at Northwestern today as part of its Advanced Topics in Taxation Workshop Series hosted by Sarah Lawsky:

This article, prepared for presentation on September 23, 2016 at a conference at NYU Law School, organized by the Center for Human Rights and Global Justice and entitled Human Rights and Tax in an Unequal World, mainly takes the form of a dialogue between two fictional individuals. The conclusions that the discussants reach (insofar as they are able to agree) can be summarized as follows:

Large-scale tax avoidance by wealthy individuals and large companies that is legally defensible under relevant national tax laws can nonetheless have major adverse effects on social justice and/or public morale. However, its legal defensibility complicates analyzing its ethical implications, as compared to the more straightforward case of committing tax fraud. Legal defensibility also complicates the analysis of the extent to which human rights advocates should focus on such desiderata as “good corporate tax behavior” and the ethics of tax professionals.

Continue reading

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

Trump And A Populist Tax Agenda

Jay A. Soled (Rutgers), James Alm (Tulane) & Kathleen DeLaney Thomas (North Carolina), Trump and a Populist Tax Agenda?, 154 Tax Notes 1131 (2017):

In this article, the authors argue that President Trump should urge Congress to institute a carryover tax basis rule for marketable securities applicable upon death.

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

Dodging The Taxman: Firm Misreporting And Limits To Tax Enforcement

Dina Pomeranz (Harvard), Paul Carrillo (George Washington) & Monica Singhal (Harvard), Dodging the Taxman: Firm Misreporting and Limits to Tax Enforcement:

Reducing tax evasion is a key priority for many governments, particularly in developing countries. A growing literature has argued that the ability to verify taxpayer self-reports against reports from third parties is critical for modern tax enforcement and the growth of state capacity. However, there may be limits to the effectiveness of third-party information if taxpayers can make offsetting adjustments on less verifiable margins. We present a simple framework to demonstrate the conditions under which this will occur and provide strong empirical evidence for such behavior by exploiting a natural experiment in Ecuador. We find that when firms are notified by the tax authority about detected revenue discrepancies on previously filed corporate income tax returns, they increase reported revenues, matching the third-party estimate when provided. Firms also increase reported costs by 96 cents for every dollar of revenue adjustment, resulting in minor increases in total tax collection.

Continue reading

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

Monday, April 10, 2017

Kleinbard Presents Capital Taxation In An Age Of Inequality Today at Pepperdine

Kleinbard (2015)Edward Kleinbard (USC) presents Capital Taxation In An Age Of Inequality, 90 S. Cal. L. Rev. ___ (2017), at Pepperdine today as part of our Tax Policy Workshop Series funded in part by a generous gift from Scott Racine:

The standard view in the U.S. tax law academy remains that capital income taxation is both a poor idea in theory and completely infeasible in practice. But this ignores the first-order importance of political economy issues in the design of tax instruments. The pervasive presence of gifts and bequests renders moot the claim that the results obtained by Atkinson and Stiglitz (1976) counsel against taxing capital income in practice.

Taxing capital income is responsive to important political economy exigencies confronting the United States, including substantial tax revenue shortfalls relative to realistic government spending targets, increasing income and wealth inequality at the top end of distributions, and the surprising persistence of dynastic wealth. It also responds to a new strand of economic literature that argues that “inclusive growth” leads to higher growth.

Continue reading

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

Cullen Presents Political Alignment And Tax Evasion Today At NYU

CullenJulie Berry Cullen (UC-San Diego), presents Political Alignment and Tax Evasion at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Rosanne Altshuler:

We explore whether the decision to evade federal personal income taxes depends on the taxpayer’s level of approval of government. We first demonstrate using survey data the positive association between political alignment with the current president and the respondent’s trust in the administration and support for government taxation and spending. We then show using IRS tax return data and county-level fixed effects regressions that the larger the typical share of county residents who vote for the president’s party the smaller the tax gap across a variety of tax gap measures. Responses are concentrated in income components that are more likely to be invisible to the government, such as small business income. Our results provide realworld evidence that a positive outlook on government lowers tax evasion.

Continue reading

April 10, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (1)

Lawsky Presents Formalizing The Tax Code Today At UC-Irvine

Lawsky (2017)Sarah Lawsky (Northwestern) presents Formalizing the Code, 70 Tax L. Rev. ___ (2017), at UC-Irvine today as part of its Tax Law and Policy Colloquium Series hosted by Omri Marian:

The Internal Revenue Code is notoriously complex, both substantively and structurally. This article examines one source of structural complexity in the Internal Revenue Code: dependency among sections that stems from defined terms. In particular, the article examines what it describes as the problem of “definitional scope”: when the structure of the Code leaves unclear to what a term refers. The article provides examples of problematic definitional scope and then suggests a general solution: that those who draft tax legislation should “formalize” the proposed statutory language—translate it into logical terms—prior to its enactment. To illustrate this proposal, the article provides formalizations of two provisions of the Internal Revenue Code.

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

Hayashi Presents A Theory Of Facts And Circumstances Today At UNLV

HayashiAndrew Hayashi (Virginia) presents A Theory of Facts and Circumstances at UNLV today as part of its Faculty Enrichment Series:

The legal consequences of an action often depend on information that only the actor knows, such as her intentions. This information is often inferred from the observable “facts and circumstances” attending the actor’s conduct, which creates a seemingly unresolvable tension in legal design. On the one hand, the unstructured nature of these analyses gives free rein to the factfinder’s judgment about which facts justify an inference to the hidden information. On the other hand, if the law were to specify in advance the facts that would be used to draw that inference it would provide a roadmap for actors to strategically adjust their conduct to manipulate the factfinder’s conclusions. I argue that this tension can be resolved by applying insights from the economics literature on asymmetric information.

Continue reading

April 10, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (1)

Polsky Presents Elite Tax Professionals Behaving Badly Today At Washington & Lee

Polsky (2015)Gregg Polsky (Georgia) presents Elite Tax Professionals Behaving Badly: The Sad and Sordid Management Fee Waiver Saga at Washington & Lee today as part of its Faculty Workshop Series:

For at least the past 15 years, many private equity fund managers have used a technique—known as a management fee waiver—to try to claim what is effectively their weekly paycheck as a capital gain. Recently, the Treasury and IRS explained that, at least in the government’s view, the vast majority of fee waivers do not actually provide the claimed tax result. Recent reports of significant audit activity relating to fee waivers suggest that the fee waiver saga may finally be coming to an end, but not before billions of tax revenues that are beyond the statute of limitations have been lost forever.

Continue reading

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

Johnson Presents Who Wins A Tax Case If There Is A Tie: The Taxpayer Or The Revenue Authority? Today At Minnesota

Johnson (Steve)Steve R. Johnson (Florida State) presents Who Wins If There’s A Tie: The Taxpayer or the Revenue Authority? at Minnesota today as part of its Perspectives on Taxation Lecture Series:

In baseball, if the runner touches the base at the same time as the baseman catches the ball or tags the runner, the runner is safe. In other words, a tie goes to the runner. State and federal tax controversies also can involve close calls, either because the facts supporting the two sides are balanced or because the law is unsettled. When that happens, when the case is close, should the court hold for the taxpayer or the revenue bureau? Courts have answered this question differently in different eras and in different jurisdictions.

Continue reading

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

Fleischer Presents Tax Reform: The State of Play Today At UCLA

Fleischer (2016)Victor Fleischer (San Diego; Co-Chief Tax Counsel, Senate Finance Committee Democrats) presents Tax Reform: The State of Play at UCLA today as part of its Business Law Breakfast Series.  Vic's talk will discuss several aspects of the House Republicans' tax reform blueprint, A Better Way for Tax Reform:

Continue reading

April 10, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (2)

Sunday, April 9, 2017

McMahon & McGovern:  2016 Federal Income Tax Developments

Florida Tax Review  (2015)Martin J. McMahon Jr. (Florida) & Bruce A. McGovern (South Texas), Recent Developments in Federal Income Taxation: The Year 2016, 20 Fla. Tax Rev. 131 (2017):

This recent developments outline discusses, and provides context to understand the significance of, the most important judicial decisions and administrative rulings and regulations promulgated by the Internal Revenue Service and Treasury Department during the most recent twelve months—and sometimes a little farther back in time if we find the item particularly humorous or outrageous. Most Treasury Regulations, however, are so complex that they cannot be discussed in detail, and, anyway, only a devout masochist would read them all the way through; just the basic topic and fundamental principles are highlighted—unless one of us decides to go nuts and spend several pages writing one up. This is the reason that the outline is getting to be as long as it is.

Continue reading

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

The Top 5 Tax Paper Downloads

SSRN LogoThere is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new paper debuting on the list at #5. The #1 paper is now #96 in all-time downloads among 12,640 tax papers:

  1. [1,756 Downloads]  The Known Unknowns of the Business Tax Reforms Proposed in the House Republican Blueprint, by Michael J. Graetz (Columbia)
  2. [612 Downloads]  How Donald Trump can Keep His Campaign Promises, Grow the Economy, Cut Tax Rates, Repatriate Offshore Earnings, Reduce Income Inequality, Keep Jobs in the United States, and Reduce the Deficit, by David S. Miller (Proskauer, New York)
  3. [399 Downloads]  Predicting Stock Market Prices with Physical Laws, by Jack Manhire (Texas A&M)
  4. [317 Downloads]  House Plan's Bad Math: Over-Estimates of Revenue from a Border Adjustment, by David Kamin (NYU) & Brad Setser (Council on Foreign Relations)
  5. [278 Downloads]  Destination-Based Cash Flow Taxation, by Alan Auerbach (UC-Berkeley), Michael P. Devereux (Oxford), Michael Keen (IMF) & John Vella (Oxford)

April 9, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Friday, April 7, 2017

Weekly SSRN Tax Article Review And Roundup

This week, Ari Glogower (Ohio State) reviews a new article by Shu-Yi Oei (Tulane), The Offshore Tax Enforcement Dragnet

Glogower (2016)In the late 1980’s, the tuna-eating public grew concerned with the ensnarement of dolphins in tuna nets.   Fisheries responding by changing harvest methods to avoid dolphin bycatch, and affixing “dolphin-safe tuna” labels to tuna cans.  The reassured public returned to their tuna sandwiches with clear consciences, evidently untroubled by the incongruity of canning and consuming one majestic ocean-dweller, while safeguarding another.  One wonders if an alternate society, with different preferences, would feel just as strongly about the ethics of eating tuna-safe dolphins.

Similarly, the U.S. government flings its net over the seas, and drags tax avoiders out of the murky depths of foreign financial institutions.  Shu-Yi Oei’s new work argues that FATCA and other initiatives designed to prevent offshore tax evasion by wealthy tax-avoiders have ensnared unintended bycatch, including recent immigrants to the U.S. who still hold assets in their home country, Americans expats living (and saving) abroad, and “accidental Americans” unaware of their U.S. citizenship.

Continue reading

April 7, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Hemel Presents The Federalist Safeguards of Progressive Taxation Today At Duke

HemelDaniel Hemel (Chicago) presents The Federalist Safeguards of Progressive Taxation, 93 NYU L. Rev. ___ (2017), at Duke today as part of its Tax Policy Workshop Series hosted by Lawrence Zelenak:

This essay considers the distributional consequences of the Supreme Court’s federalism jurisprudence over the past quarter century, focusing specifically on the anticommandeering, anti-coercion, and state sovereign immunity doctrines. The first of these doctrines prevents Congress from compelling the states to administer federal programs; the second prevents Congress from achieving the same result through offers that for practical purposes the states cannot refuse; the third prohibits Congress from abrogating state sovereign immunity outside a limited class of cases. These doctrines vest the states with valuable entitlements and allow the states to sell those entitlements back to Congress for a price. In this respect, the doctrines have an intergovernmental distributional effect, shifting wealth from the federal government to the states.

Continue reading

April 7, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Mann Presents Using Tax Law To Control Obesity Today At Lewis & Clark

Lewis & ClarkRoberta Mann (Oregon) presents Controlling the Environmental Costs of Obesity today at the symposium on 21st Century Food Law: What's On Our Plates? at Lewis & Clark:

Obesity is increasingly viewed as a major health problem across the world. Obesity presents both external and internal costs. Obesity alone may be responsible for some $2 trillion in medical costs and lost productivity, representing significant external costs. Internal costs occur because people make eating and drinking choices without being aware of the eventual damage to their health. Obesity also carries environmental costs. Consumption of certain energy dense foods made from corn and soy (including meat) increases soil erosion and water pollution from fertilizer use. Governmental policy encourages the production of such crops. Being overweight decreases physical activity and personal mobility, leading to increased use of motor vehicles. Environmental factors such as sprawl and transportation policy affect obesity rates. When people cannot walk or take public transportation to work, they spend more time in their cars. They have less time to exercise and prepare healthy meals. Hence, both obesity’s effect on the environment and the environment’s effect on obesity lead to increased carbon emissions and exacerbate climate change. Taxes can potentially control both the external and internal costs of obesity.

Continue reading

April 7, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (7)

Thursday, April 6, 2017

Oh Presents Are Progressive Tax Rates Progressive Policy? Today At Indiana

OhJason Oh (UCLA) presents Are Progressive Tax Rates Progressive Policy?, 92 NYU L. Rev. ___ (2017), at Indiana-Bloomington today as part of its Tax Policy Colloquium Series hosted by Leandra Lederman:

Why do income tax systems across the world consistently feature progressive marginal rates? The existing literature tells a political story focusing on the top of the rate schedule and the preferences of the poor and middle class. According to this standard view, higher rates at the top result from the poor and middle class using the political process to “soak the rich.” However, this explanation is inconsistent with research showing that public policy is generally more responsive to the preferences of the rich. Explaining marginal rate progressivity as a universal (and exceptional) triumph of the poor and middle class rings hollow.

This Article resolves this tension in the extant literature by showing how progressive marginal rates are in fact consistent with the preferences of the rich.

Continue reading

April 6, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Fleming, Peroni & Shay:  The Transition Tax Issue

J. Clifton Fleming Jr. (BYU), Robert J. Peroni (Texas) & Stephen E. Shay (Harvard), Getting from Here to There: The Transition Tax Issue, 154 Tax Notes 69 (Mar. 27, 2017):

If there is fundamental U.S. international income tax reform, regardless of the reform option chosen, the United States must decide how to handle the $2.4 trillion to $2.6 trillion of previously untaxed foreign income accumulated by U.S. multinational corporations. In this report, Fleming, Peroni, and Shay argue that the proper approach is to treat the income as a subpart F inclusion in the year before the effective date of fundamental reform and to tax it at regular rates with an option to make the payments in installments that bear market-rate interest.

Continue reading

April 6, 2017 in Scholarship, Tax | Permalink | Comments (0)

Wednesday, April 5, 2017

Corporate Tax Avoidance and Honoring The Fiduciary Duties Owed To Corporation And Its Stockholders

Eric C. Chaffee (Toledo) & Karie Davis-Nozemack (Georgia Tech), Corporate Tax Avoidance and Honoring the Fiduciary Duties Owed to Corporation and Its Stockholders, 58 B.C. L. Rev. ___ (2017):

Corporate tax avoidance is a pressing issue of both national and international concern. In recent years, the tax strategies of Apple, Facebook, Pfizer, Starbucks, and numerous other corporations have reminded the public that firms regularly undertake highly aggressive tax strategies to minimize their corporate taxes. Corporations often claim that they are legally required to engage in these aggressive strategies. But this article proves that claim is utterly and completely incorrect when based upon the fiduciary duties owed to the corporation and its stockholders.

Continue reading

April 5, 2017 in Scholarship, Tax | Permalink | Comments (1)

Tax And The Timing Of Lawmaking

TimingThe Timing of Lawmaking (Frank Fagan (EDHEC) & Saul Levmore (Chicago) eds. Edward Elgar 2017):

Legal reasoning, pronouncements of judgment, the design and implementation of statutes, and even constitution-making and discourse all depend on timing. This compelling study examines the diverse interactions between law and time, and provides important perspectives on how law's architecture can be understood through time. The book revisits older work on legal transitions and breaks new ground on timing rules, especially with respect to how judges, legislators and regulators use time as a tool when devising new rules. At its core, The Timing of Lawmaking goes directly to the heart of the most basic of legal debates: when should we respect the past, and when should we make a clean break for the future?

  • Saul Levmore (Chicago), Interest Groups and the Durability of Law

Continue reading

April 5, 2017 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Tuesday, April 4, 2017

Devereux & Vella Present Destination-Based Cash Flow Taxation Today At Georgetown

DVMichael Devereux & John Vella (Oxford University Centre for Business Taxation) present Destination-Based Cash Flow Taxation (with Alan Auerbach (UC-Berkeley) & Michael Keen (International Monetary Fund)) at Georgetown today as part of its Tax Law and Public Finance Workshop Series hosted by John Brooks and Itai Grinberg:

This paper sets out a possible approach to the international taxation of corporate profit: a destination-based cash flow tax (DBCFT). This option is one of a number that have been considered over the last three years by a group of economists and lawyers, chaired by Michael Devereux. The other current members of the group are Alan Auerbach, Michael Keen, Paul Oosterhuis, Wolfgang Schön and John Vella. ...

Continue reading

April 4, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Oei:  The Offshore Tax Enforcement Dragnet

Shu-Yi Oei (Tulane; moving to Boston College), The Offshore Tax Enforcement Dragnet:

Taxpayers who hide assets abroad to evade taxes present a serious enforcement challenge for the United States. In response, the U.S. has developed a family of initiatives that punish and rehabilitate non-compliant taxpayers, raise revenues, and require widespread reporting of offshore financial information. Yet, while these initiatives help catch willful tax cheats, they have also adversely affected immigrants, Americans living abroad, and “accidental Americans.”

This Article critiques the United States’ offshore tax enforcement initiatives, arguing that the U.S. has prioritized two problematic policy commitments in designing enforcement at the expense of competing considerations: First, the U.S. has attempted to equalize enforcement against taxpayers with solely domestic holdings and those with harder-to-detect offshore holdings by imposing harsher reporting requirements and penalties on the latter. But in doing so, it has failed to appropriately distinguish among differently situated taxpayers with offshore holdings. Second, the U.S. has focused on revenue and enforcement, ignoring the significant compliance costs and social harms that its initiatives create.

Continue reading

April 4, 2017 in Scholarship, Tax | Permalink | Comments (0)

Brookings Hosts Panel Discussion Today On Why Americans Are Proud to Pay Taxes

Read My LipsThe Brookings Institution is hosting a panel discussion today to mark release of the new book by Vanessa S. Williamson, Read My Lips: Why Americans Are Proud to Pay Taxes (Princeton University Press 2017).  The panel will discuss the book and take audience questions and respond to questions on Twitter at #Taxes or @BrookingsGov.

Conventional wisdom holds that Americans hate taxes. But the conventional wisdom is wrong. Bringing together national survey data with in-depth interviews, Read My Lips presents a surprising picture of tax attitudes in the United States. Vanessa Williamson demonstrates that Americans view taxpaying as a civic responsibility and a moral obligation. But they worry that others are shirking their duties, in part because the experience of taxpaying misleads Americans about who pays taxes and how much. Perceived "loopholes" convince many income tax filers that a flat tax might actually raise taxes on the rich, and the relative invisibility of the sales and payroll taxes encourages many to underestimate the sizable tax contributions made by poor and working people.

Continue reading

April 4, 2017 in Book Club, Scholarship, Tax | Permalink | Comments (2)

Monday, April 3, 2017

Thomas Presents Taxing The Gig Economy Today At NYU

Thomas (2017)Kathleen Delaney Thomas (North Carolina) presents Taxing the Gig Economy at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Rosanne Altshuler:

Due to advances in technology like mobile applications and online platforms, millions of American workers now earn income through “gig” work, which allows them the flexibility to set their own hours and choose which jobs to take. To the surprise of many gig workers, the tax law considers them to be “business owners,” which subjects them to onerous recordkeeping and filing requirements, along with the obligation to pay quarterly estimated taxes. This Article proposes two reforms that would drastically reduce tax compliance burdens for this new generation of small business owners, while simultaneously enhancing the government’s ability to collect tax revenue.

First, Congress should create a “non-employee withholding” regime that would allow online platform companies such as Uber to withhold taxes for their workers without being classified as employers. Second, the Article proposes a “standard business deduction” for gig workers equal to 80 percent of their gross receipts, which would eliminate the need to track and report business expenses.

Continue reading

April 3, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Kane Presents The Global Battle To Capture MNE Profits At British Columbia

Kane (2015)Mitchell Kane (NYU) presented The Global Battle to Capture MNE Profits (with Joseph Bankman (Stanford) & Alan O. Sykes (Stanford)) at University of British Columbia Allard School of Law last Friday as part of its Tax Law and Policy Workshop Speaker Series:

This paper explores the various tools available to jurisdictions in their quest to capture MNE rents, including various forms of income and consumption taxation, government purchasing programs, price regulation, antitrust, and common trade instruments such as tariffs or quotas. Although the jurisdictional goal of rent capture might well be constant across the use of this vast array of instruments, the legal regulation of such actions is anything but that. Instead, there would appear to be important fissures in the tapestry of legal regulation.

Continue reading

April 3, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Sunday, April 2, 2017

The Top 5 Tax Paper Downloads

SSRN LogoThis week's list of the Top 5 Recent Tax Paper Downloads is the same as last week's list. The #1 paper is now #99 in all-time downloads among 12,628 tax papers:

  1. [1,720 Downloads]  The Known Unknowns of the Business Tax Reforms Proposed in the House Republican Blueprint, by Michael J. Graetz (Columbia)
  2. [593 Downloads]  How Donald Trump can Keep His Campaign Promises, Grow the Economy, Cut Tax Rates, Repatriate Offshore Earnings, Reduce Income Inequality, Keep Jobs in the United States, and Reduce the Deficit, by David S. Miller (Proskauer, New York)
  3. [459 Downloads]  Accounting for Behavioral Considerations in Business Tax Reform: The Case of Expensing, by Lily L. Batchelder (NYU)
  4. [387 Downloads]  Predicting Stock Market Prices with Physical Laws, by Jack Manhire (Texas A&M)
  5. [289 Downloads]  House Plan's Bad Math: Over-Estimates of Revenue from a Border Adjustment, by David Kamin (NYU) & Brad Setser (Council on Foreign Relations)

April 2, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, April 1, 2017

20th Annual Critical Tax Theory Conference At St. Louis

St. Louis (2016)St. Louis hosts the 20th Annual Critical Tax Theory Conference today:

Critical tax scholarship aims at looking beyond the language of the Code and regulations to examine what the tax law actually does. It has roots in critical legal studies generally, and therefore Critical tax scholars frequently ask why the tax laws are the way they are and what impact tax laws have on historically disempowered groups, such as people of color; women; lesbian, gay, bisexual, and transgendered individuals; low-income and poor individuals; the disabled; and nontraditional families. But Critical tax scholarship is not limited either to those topics or to any particular methodology.

Continue reading

April 1, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Friday, March 31, 2017

Weekly SSRN Tax Article Review And Roundup

This week, Erin Scharff (Arizona State) reviews a new working paper by Ben Meiselman (Michigan), Ghostbusting in Detroit:  Evidence on NonFilers from a Controlled Field Experiment.

Scharff (2017)As Ben Meiselman notes in the introduction to his new study of taxpayer compliance, there’s no marginal cost to making a tax authority’s written communication to a taxpayer more persuasive. In an era of likely increasing austerity in tax enforcement budgets at all levels of government, finding low-costs methods to increase compliance will become all the more important.  Field experiments have produced some information about effective messages, and Meiselman’s study adds to this research, but as I discuss after reviewing the paper’s findings, Meiselman’s account also raises questions about Detroit’s capacity to operate an income tax.

In the spring and early summer of 2016, Detroit sent both a postcard and a certified letter to 7,142 suspected “ghosts,” 2014 federal taxpayers with Detroit addresses who had failed to file a Detroit income tax return for that tax year.  A control postcard informed taxpayers that they would receive a letter in a few days about filing a tax return, and the subsequent letter informed the taxpayer that Detroit’s records indicated that she was a resident of Detroit and did not file a city tax return in 2014.

Continue reading

March 31, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

St. Louis Hosts Conference Today On Taxation And Migration

St. LouisSt. Louis hosts a conference today on Critical Issues in Comparative and International Taxation: Taxation and Migration:

As ever growing numbers of individuals seek economic and political refuge in Europe and North America, and as increasing numbers of individuals and businesses seek refuge from the tax burdens of their home jurisdictions in lower tax jurisdictions, the resulting immigration and emigration strain the national economies of affected countries causing them to modify their taxation rules and structures. This conference explores the effects of taxation on migration and the effects of migration on taxation.

Panel #1:  Migrant Tax Plight, Human Rights, and Hidden Wealth

Panel #2:  Combatting Expatriation

Continue reading

March 31, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Using Google Scholar Citation Counts To Measure The Impact Of Law Faculty Scholarship

Google Scholar (2015)Gary Lucas, Jr. (Texas A&M), Measuring Scholarly Impact: A Guide for Law School Administrators and Legal Scholars:

Texas A&M University assesses its colleges and departments based partly on scholarly impact and using quantitative metrics. The law school’s dean has assigned me the task of identifying scholarly impact metrics for use in assessing the performance of our law faculty collectively and individually. This essay discusses the major issues that arise in measuring the impact of legal scholarship. It also explains important scholarly impact metrics, including the Leiter score and Google Scholar h-index, and the major sources of information regarding scholarly impact, including Google Scholar, Westlaw, Hein Online, SSRN, and bepress.

Continue reading

March 31, 2017 in Legal Education, Scholarship | Permalink | Comments (0)

Call For Papers: NTA 110th Annual Conference On Taxation

National Tax Association (2016)The National Tax Association has issued a Call for Papers for its 110th Annual Conference on Taxation to be held Nov. 9-11, 2017 in Philadelphia:

The 110th Annual Conference on Taxation will cover a broad range of topics including, but not limited to, taxation and tax policies; expenditure policies; government budgeting; intergovernmental fiscal relations; and subnational, national, and international public finance. The conference will focus, as always, on policy-relevant research bearing on taxation and government spending.

Continue reading

March 31, 2017 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Thursday, March 30, 2017

Batchelder Presents Accounting For Behavioral Biases In Business Tax Reform Today At Duke

BatchelderLily Batchelder (NYU) presents Accounting for Behavioral Biases in Business Tax Reform: The Case of Expensing at Duke today as part of its Tax Policy Workshop Series hosted by Lawrence Zelenak:

One of the fundamental questions in business tax reform is whether to allow firms to immediately expense investments or require economic cost recovery. The conventional view is that expensing would generate stronger growth effects holding revenues constant. This view is rooted in traditional models of corporate finance that assume firms look at the net present value of expected tax payments when incorporating taxes into investment decisions. But this traditional view ignores the possibility that firms focus on more salient measures of taxes as well. If so, they may respond less to expensing than this theory suggests because expensing does not lower their financial accounting tax liability and, all else equal, requires a higher statutory rate.

This paper considers whether firms undervalue expensing due to a focus on these non-economic tax metrics and, if so, what this implies about business tax reform if the goal is to increase US investment. It develops a framework for what cost recovery rules are optimal, and then uses new and existing data to parameterize this framework, holding constant long-run revenues and the relative tax treatment of debt and equity. 

Continue reading

March 30, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (1)