TaxProf Blog

Hickman: Unpacking the Force of Law in Tax Cases

Kristin Hickman (Minnesota), Unpacking the Force of Law, 66 Vand. L. Rev. ___ (2013):

In 2011, in Mayo Foundation for Medical Education and Research v. United States, the Supreme Court held that general authority Treasury regulations adopted using notice-and-comment rulemaking carry the force of law and thus are eligible for Chevron deference. In the wake of Mayo, courts and scholars are now struggling with its implications for whether temporary Treasury regulations and IRB guidance documents (revenue rulings, revenue procedures, and notices) that lack notice and comment but are enforceable through civil penalties are likewise eligible for Chevron deference and, relatedly, whether these formats are in fact subject to APA notice-and-comment rulemaking requirements. Currently prevailing judicial tests for evaluating these questions do not offer clear or easy answers for the tax context. Ultimately, both questions turn on whether the agency actions in question carry “the force of law.” The purpose of this Article is to take a step back from existing doctrinal standards and to sort through the basic administrative law principles and Supreme Court precedents that drive those standards in an effort to develop a coherent approach to Treasury and IRS rulemaking and judicial review thereof.  

Step Transactions, Economic Substance, and the Tax Code

Philip Sancilio (J.D. 2013, Columbia), Clarifying (or Is It Codifying?) The “Notably Abstruse”: Step Transactions, Economic Substance, and the Tax Code, 113 Colum. L. Rev. 138 (2013) (Second Place, 2012 Tannenwald Writing Competition):

The economic substance and step transaction doctrines are two specific examples of courts’ general willingness to sometimes look past transactions’ technical form and impose taxes based on their underlying substance. As judicial creations, the two doctrines served as complements and functional equivalents. However, they also generated a wide variety of vague, overlapping, and conflicting formulations.

In 2010, Congress incorporated the economic substance doctrine into the Internal Revenue Code by defining its content and tying it to a heightened strict liability penalty. When it did so, Congress did not address when the doctrine is available. Instead, it left that determination to the preexisting common law and articulated a functional definition of the doctrine to which its new statutory scheme applies. However, the definition of the codified economic substance doctrine creates uncertainty by encompassing some, but not all, of the various formulations of the step transaction doctrine. Terminological messiness that used to have little effect beyond confusing dicta could now control the imposition of statutory requirements and heightened liability.

After laying out the doctrinal background, this Note applies the definition of the newly codified economic substance doctrine to the various formulations of the step transaction doctrine and demonstrates problematic inconsistency in the results. It then traces that inconsistency to the uncertain relationship between the doctrines and argues for conceptual clarification. Finally, it proposes that the codified economic substance doctrine should apply first and that the step transaction doctrine should stand behind it as a backstop.

LBJ, the IRS, and Churches: The Unconstitutionality of the Johnson Amendment

Erik W. Stanley (Senior Legal Counsel, Alliance Defense Fund), LBJ, the IRS, and Churches: The Unconstitutionality of the Johnson Amendment in Light of Recent Supreme Court Precedent, 24 Regent U. L. Rev. 237 (2012):

Part I of this Article examines the history of church tax exemption and demonstrates that exemption for churches is an unbroken practice with an extremely long historical pedigree. Thus it should not be lightly cast aside, and any threat to its existence should be taken seriously. Part I also traces the history of the restrictions on church tax exemption added by Congress in 1934 and 1954, including the history of the Johnson Amendment and the suspect circumstances surrounding its passage.

Part II analyzes the history of IRS enforcement of the Johnson Amendment, discussing the uneven and sporadic nature of that enforcement. The IRS’s vague and uneven enforcement scheme has resulted in a pervasive and palpable chill on the speech of pastors and churches as they have self-censored in order to avoid potential Johnson Amendment violations and the extreme consequences associated with such violations.

Part III builds on the prior two points and analyzes the Johnson Amendment in light of the recent Supreme Court cases of Citizens United v. FEC, Arizona Christian School Tuition Organization v. Winn, and Hosanna-Tabor Evangelical Lutheran Church & School v. EEOC. The Article concludes that these cases provide important indications that the Johnson Amendment is an unconstitutional violation of the Free Speech and Free Exercise Clauses of the First Amendment, and that it cannot be justified by reliance on tax subsidy theories of regulation.

It is not the goal of this Article to repeat the work of legal scholars who have analyzed the Johnson Amendment from various angles. The great weight of that legal scholarship leans decidedly in favor of the conclusion that the Johnson Amendment is unconstitutional as a violation of the First, Fifth, and Fourteenth Amendments of the United States Constitution as well as the Federal Religious Freedom Restoration Act. Rather, this Article offers a fresh look at the Johnson Amendment in light of recent Supreme Court precedent that has direct bearing on its constitutionality. This precedent—when viewed in light of the history of church tax exemptions, Congress’s adoption of the Johnson Amendment, and the IRS’s enforcement of the Johnson Amendment—demonstrates that the pastors who participated in Pulpit Freedom Sunday were justified in challenging the Johnson Amendment and should not have long to wait before it is declared unconstitutional or repealed.

WaPo: Total Number of Tax Breaks in 2011

Washington Post, Building the U.S. Tax Code, Break by Break:

The U.S. government gives away more than $1 trillion a year in tax breaks — subsidies for individuals and companies that are often substitutes for direct government spending. Once written into the tax code, they tend to stick around.

This chart shows the 172 tax breaks currently on the books and the year
each one was first reported by the U.S. Treasury:

 
 

Corporate Tax Reform, Deferred Taxes, and the Effect on Book Profits

Jana Smith Raedy (University of North Carolina), Jeri K. Seidman (University of Texas) & Douglas A. Shackelford (University of North Carolina) have posted Corporate Tax Reform, Deferred Taxes, and the Immediate Effect on Book Profits on SSRN. Here is the abstract:

This paper analyzes the impact of GAAP-mandated adjustments to deferred tax accounts when corporate income tax rates change. Using hand-collected data from the tax footnotes of the Fortune 50, we estimate that a reduction in the corporate tax rate from 35% to 30% would substantially affect the accounting earnings, capital, and effective tax rate of many companies. For the 18 publicly-traded Fortune 50 companies with a net deferred tax asset position, the total drop in accounting earnings would be $12 billion, with the banking industry experiencing some of the largest earnings decreases. For the 31 publicly-traded Fortune 50 companies with a net deferred tax liability position, the total jump in accounting earnings would be $28 billion, with the energy industry enjoying many of the largest increases. Although these large, one-time adjustments to the deferred tax accounts do not affect cash taxes paid, users of the financial statements should be aware that the deferred tax accounts may be significantly altered if and when tax rates change and that these effects will be reflected in net income.

Taxing Twitter

Twitter is demanding huge tax incentives to remain in San Francisco.

• Accounting Today, Twitter Wants Big Tax Breaks
• Just Means, Twitter's San Francisco Shenanigans
• San Francisco Chronicle, Tax Break to Twitter Makes Sense
• San Francisco Examiner, Legislation Offers Tax Break to Keep Twitter in San Francisco
• TG Daily, Extortionist Twitter Demands Massive Tax Breaks

Johnson: Small Business Inventory Expensing

Calvin H. Johnson (Texas) has posted Small Business Inventory Expensing, 129 Tax Notes 591 (Nov. 1, 2010), on SSRN. Here is the abstract:

The President’s Economic Recovery Advisory Board (PERAB) recently recommended allowing small businesses to expense their inventory and exclude their customer receivables from tax. The PERAB proposals are a tax shelter or subsidy that are better than no tax. Investing with deducted or excluded funds is economically equivalent to an exemption of profit from tax, and when the interest deduction is taken into account, the result is a negative tax.

Records to reflect inventory and receivables are easy to maintain and are getting cheaper with the availability of computerized accounting. Every business knows how much its customers owe it, and no business has lost money reflected in valuable inventory it still has on hand. The PERAB proposal is prone to abuse as dentists and lawyers seek shelter. Indeed it would always be open to abuse.

Kaye: Direct Taxation in the European Union

Tracy A. Kaye (Seton Hall) has published Direct Taxation in the European Union: Past Trends and Future Developments, 16 ILSA J. Int'l & Comp. L. 423 (2010).

Abrams: The Carried Interest Catastrophe

Howard E. Abrams (Emory) has published The Carried Interest Catastrophe, 128 Tax Notes 523 (Aug. 2, 2010). Here is the abstract:

Congress seems intent on taxing the labor component of carried interests as ordinary income. If that must be done, it should be simple and accurate. The method of taxation provided for under the current legislative proposal is neither.

All Tax Analysts content is available through the LexisNexis® services.

Structuring a Tax Policy Workshop Series -- Indiana-Bloomington's Experience

Last Spring, I ran a series of posts on Structuring a Tax Policy Workshop Series -- spawned by Leandra Lederman's decision to start a tax workshop series at Indiana-Bloomington -- with contributions from those schools with such a series (Boston College, Columbia, Connecticut, Loyola-L.A., Michigan, NYU, Northwestern, Penn, Toronto, and UCLA), as well as Neil Buchanan's thoughts on the "Best Practices" emerging from these contributions (and Roberta Mann's "Collector's Edition" -- a Word document with all of the entries in the series).

Below the fold, Leandra offers her thoughts on the first year of Indiana-Bloomington's Tax Policy Colloquium Series.

Approximately a year ago, at Paul’s request, I kicked off a discussion regarding structuring a tax policy workshop series. Indiana-Bloomington’s Tax Policy Colloquium, which is structured as a class, started this spring. I ran the Colloquium this year, and Ajay Mehrotra will do so next spring. The end of the semester seemed like an appropriate time to look back on what worked well and what might be changed in future years.

I found it incredibly rewarding to run the Colloquium. The faculty presenters really engaged with the students and seemed to value the feedback they received. The students seemed to regard it as a special class, and their ability to get to the heart of faculty works in progress and ask probing questions exceeded my expectations.

Two aspects of the Colloquium seemed particularly helpful. The first one is the use of background reading. Many of the topics were new to the students, although all 13 of them had not only completed Income Tax (the prerequisite) but were also enrolled in my Corporate Tax class, and many of them had also taken other tax courses. The first paper in the series used a lot of terminology related to executive compensation, so I asked its author, David Walker, if he had any suggestions for readings that might help bring the students up to speed. His suggestions were so helpful that I asked each of the other presenters to suggest readings. I didn’t always assign all of what they suggested, and I sometimes supplemented their suggestions with a primary source, but the suggestions were invaluable.

Second, having a presenter only in alternate weeks so that the students and I could discuss the paper and background reading as a class was very effective. My goal with those sessions was to try to make sure everyone in the class understood the thesis of the paper and its principal arguments, so that they would be empowered to bring their own perspectives to their required reaction papers.

During the talks, I kept a question queue. That worked well, but, in the future, I plan to adopt a student suggestion of allowing participants to jump the queue if they signal that they have a question related to a topic under discussion. I required students to ask questions in 4 out of the 6 presentations, in order to encourage them to participate but not to require them to speak when they had nothing to say. Giving student questions priority for the first 20-30 minutes of the question period worked very well; the concern Dave Rifkin expressed in his post last year about students’ comfort level and ability didn’t seem to be manifested. I think the preparatory session and background reading were very helpful in that regard.

I assigned the students a 3 to 5-page reaction paper in response to each of the six works in progress, plus one final paper, the default option for which was a rewrite of an earlier paper. The class meets our non-seminar advanced writing requirement, so I gave the students timely written feedback on each paper, directed both at substance and at helping them improve their writing. The paper length seemed fine, though occasional reaction papers were short where a student had little to say, and some were longer. A few students mentioned that they would have liked to have been invited to propose editorial suggestions directly on the works in progress, in addition to writing reaction papers that focused on substantive critiques. When I teach the course again, I’m inclined to experiment with giving them that option.

Ted Seto kindly shared his course materials and syllabus with me, which were very helpful. Some of his reaction papers are due after the speaker’s presentation. I experimented with that by allowing each student to defer one paper. The post-presentation reaction papers were not noticeably different, but the students liked the opportunity to defer one paper, from a time-management perspective. I also experimented with having reaction papers due before or after our background class discussion. The students preferred the latter because the class discussion gave them the reassurance that they were on track before they had to finalize their papers. They still seemed equally prepared for class, perhaps in part because they were required to submit 2-3 discussion questions in advance of class. The students’ papers also reflected distinct perspectives, rather than converging, as I had thought they might.

The main area in which I was somewhat disappointed was faculty attendance. Although quite a number of faculty expressed interest in the Colloquium, there turned out to be a group of about 4 frequent attendees, with only an occasional additional attendee. In part, I think that was because there were often other talks the same day, given other workshop series and a busy faculty appointments year. Another reason may be that I communicated the expectation that all attendees have read the paper. I later concluded that that was unnecessary given that the core group of faculty attendees and the students in the class had all done so. My distribution list also generally included only people interested in tax or workshops of this type, including select tax alumni of the law school. Although I did reach out to specific faculty elsewhere in the University who I thought might be interested in particular papers (because of historical or empirical analysis, for example), I didn’t ask them to forward the e-mail to others in their departments. Next time, I plan to try to identify in advance faculty in other schools on campus who might be willing to circulate an announcement about a specific talk and encourage interested faculty and students to attend. On the plus side, one of our alumni who practices tax in a firm in Indianapolis came down for almost all of the presentations. It was very helpful to have his perspective on the topics, many of which he had experience with in practice.

I conducted a survey in the final class session, and the results suggest that the students really enjoyed the class and thought they benefited from it. A number of them remarked that they valued the opportunity to comment on works in progress and that they thought that reading papers in various stages of development helped them improve their own writing.

Structuring a Tax Policy Workshop Series -- Collector's Edition

Roberta F. Mann (Widener) prepared this Word document with all of the entries in our series on structuring a tax policy workshop series:

• Best Practices (Neil Buchanan)
• Boston College
• Columbia
• Connecticut
• Indiana-Bloomington
• Loyola-L.A.
• Michigan
• NYU (Convenor, Student)
• Northwestern
• Penn
• Toronto
• UCLA

Structuring a Tax Policy Workshop Series -- Best Practices

Neil Buchanan (George Washington) offers some concluding thoughts on our series on how to best structure a tax policy workshop series:

This series of posts describing different law schools' tax policy workshops has been extremely valuable. A number of similarities across schools have emerged; yet it is also interesting to see how many seemingly small decisions must be made in structuring a workshop. Paul Caron has asked me to distill some "best practices" from what we've read here and from my own experiences presenting papers at workshops. This is an especially pertinent inquiry for me, because it is quite possible that we will be starting a tax policy workshop at GW as early as Fall 2009.

Like many readers of TaxProf, I have been an avid participant in the tax policy workshop series around the country. I have presented works-in-progress at Loyola-L.A., Michigan, NYU (twice), and Toronto; and I have attended workshops at Columbia and NYU regularly. When I was in my final semester of the JD program at Michigan in Spring 2002, the tax faculty there (Reuven Avi-Yonah, Jim Hines, and Kyle Logue) inaugurated Michigan's tax policy workshop. Being enrolled in that workshop was such a positive experience for me that it convinced me to focus my future scholarship entirely on tax policy. It is a very positive development that ever more law schools are creating these workshops, both for the benefit of tax scholars and for students who might be inspired to become tax scholars.

The most important point that I would make about tax policy workshops is that they are almost impossible to mess up! The basic formula is simple and reliable: scholar with work in progress + interested students + interested scholars = positive intellectual experience for everyone. The organizers of each workshop must make many decisions about how to structure the workshop, but having participated in and observed as many workshops as I have, I can state with great confidence that the most important aspect of a workshop is that it simply exist. Being involved in a tax policy workshop might not change everyone's life the way it -- quite literally -- changed mine, but I wouldn't bet against it.

There appear to be four basic variations on the structure of a workshop: (1) Invite a scholar each week of the semester to present a paper in a 2-hour session, (2) Spend the first few meetings of a semester introducing students to the tax policy literature, with the remaining weeks of the semester following Model #1, (3) Invite a scholar every other week of the semester to present a paper in a 2-hour session, with the intervening weeks devoted to having students read foundational readings in the area of tax policy in which the subsequent invited scholar's paper is situated, or (4) Meet with students for 2 hours each week to prepare for the scholar's visit, then meet in a workshop format for an additional 2 hours each week. Model #4, of course, turns the workshop into a 4-credit hour class, whereas the other three models are based on 2 credit-hours; so a big part of that decision would depend on the resources that a law school is willing to commit to a workshop as well as the number of students who might enroll in such a credit-heavy course. For what it is worth, I am drawn to Model #3, the every-other-week approach, for reasons that I'll explain below.

The underlying issue here is how to deal with the uneasy fit between the fundamental nature of law school as a place to train practicing lawyers and the increasing desire among law schools to become, for lack of a better term, more scholarly institutions. The work-in-progress model copied by most law school workshops, after all, is the graduate student seminars in Ph.D. programs in the social sciences and the humanities. There, students enrolled in the seminars have at least a full year of theory classes under their belts and are enrolled in specialized field courses in the subject matter of the seminar. The students in a Labor Economics workshop, for example, will have already taken full-year course sequences in (at least) micro- and macroeconomic theory and econometrics. They will also be enrolled in a two-semester advanced Labor Economics sequence. By contrast, JD students enrolled in a tax policy workshop can be reasonably expected to have taken the core 1L sequence and the basic Federal Income Taxation course. Even though each piece of legal scholarship is expected (appropriately, in my opinion) to include much more background than is common in other fields to situate a reader in the literature, the realities of law school mean that our students will come to a workshop with a great deal of enthusiasm and talent but with precious little specialized knowledge about the papers that they will be expected to read and critique. (Given that tax policy scholarship is so wonderfully broad, the students have even less hope of being well-versed in any significant range of the underlying debates.) Bringing students into a debate in this context thus involves a significant commitment on the part of the workshop's convenor(s) to ongoing remediation (or, perhaps more descriptively, "speed learning"). While each set of students is different, and each convenor will have her own preferences, it seems to me that it is best to err toward more teaching of the scholarly background rather than less. This will ultimately benefit the presenters as well as the students, of course.

One of the most difficult aspects of moderating the workshop itself, in my opinion, involves not allowing the session to be dominated by "insider talk" among the established scholars. There's an old joke, the premise of which is that the inmates in a prison know the same jokes to the point where each joke has been assigned a number; and telling a joke has devolved into simply yelling out its number. I often feel that tax policy workshops can go one step beyond that apocryphal prison yard: not only do the older inmates know all the jokes by number, but we sometimes know which joke someone is going to invoke and cut them off before the number is even uttered, saying, "I was thinking of that one, too." It is absolutely essential, I believe, for our workshops to involve full sentences being spoken in non-coded form. I am convinced that this does not risk dumbing the discussion down for the students, because on those occasions when a brave soul has asked for the coded language to be translated, it has almost invariably turned out that many of the professors in the room were on the wrong track. In fact, it is not uncommon for the two code-speakers to have misunderstood each other.

The variations among law schools in how to induce student participation (number and length of papers, requirements to ask questions during the session, etc.) all appear to me to be reasonable variations on a theme. None seems obviously superior, and each requires active efforts by the convenor(s) to make sure that the methods chosen result in the desired results: quality feedback to the visiting scholar, intellectual engagement for the students, and a vibrant discussion for everyone in the seminar room. I did, however, note one very specific innovation that I plan to steal from Northwestern: designating a student in each session to take notes on the session and forward those notes to the visiting scholar.

Finally, I should emphasize that one of the great values of holding tax policy workshops in law schools is that we embrace an interdisciplinary approach to scholarship. Bringing together scholars, convenors, and commentators with different scholarly backgrounds (within law as well as in related fields) is our greatest strength. We do ourselves and our students a great favor by being mindful not to allow our discussions to be dominated by the methodologies or assumptions of any single field of study. It is very heartening to see the interdisciplinary approach to tax policy scholarship flowering across the country. I hope that the trend of encouraging this through tax policy workshops at more and more law schools continues.

For descriptions of the various tax policy workshop series, see:

• Boston College
• Columbia
• Connecticut
• Indiana-Bloomington
• Loyola-L.A.
• Michigan
• NYU (Convenor, Student)
• Northwestern
• Penn
• Toronto
• UCLA

Structuring a Tax Policy Workshop Series -- Northwestern

Charlotte Crane, host of Northwestern's Advanced Topics in Taxation Workshop Series, continues our series on how to best structure a tax policy workshop series:

We have generally had seven authors in a semester, with a class discussion of the next paper in the alternate weeks. The author sessions are in the late afternoon and are open not only to our law school and university faculty, but to the other tax faculty and interested others in the Chicago area.

So far, we have opted for a broad range of authors with a broad range of topics and methods, rather than trying to have any particular focus. The emphasis of the colloquium, as well as the other invited speakers programs maintained by the Graduate Tax Program, has been on exposing the students to the full variety of scholarly and professional pursuits that can emerge from and feed into tax expertise they are developing.

This year (my first running the tax colloquium), I had our students not only write response papers, but also had them engage with the papers in two other ways. First, they each were required to role-play, and present the paper as if they were the author during the first 30-45 minutes of the class the week before the author present. When the timing of the availability of the paper and the mock presentation allowed it, the response papers were prepared in time that the student presenter had the benefit of them. (The presenter has also sometimes been responsible for writing a draft summary of the comments of their fellow students, to be shared with the presenter before the talk; scheduling constraints has sometimes made this difficult.) Second, one of them was required to take notes during the author’s presentation. (Their instructions were to note in particular those points which did not seem to be in the paper or were emphasized differently in the paper, and to record the exchange during the discussion part of the presentation so that the author would not have to worry about not being able to reconstruct the discussion.) Third, they are required to ask a question during each presentation.

These tasks helped ensure that the students engaged with the papers to the fullest extent possible. Knowing that the mock presenter and their fellow students, as well as the actual author, were likely to see the response papers increased the care with which they were written. (It remains a challenge to convince the students that you would really prefer to have a response paper that develops one sustained argument instead of a series of essentially unrelated reactions; part of the point of the exercise, it seems to me, should be to help them understand the difference.) The students appreciate the “skills training” that these tasks introduced to the course, and the tasks do give them more reason to dig deeper into topics that might not otherwise seem interesting.

Many of the students in the class are in the second semester of our LLM program, which presents something of a challenge for keeping the JDs from being intimidated by the course. (We have a fairly traditional tax policy seminar, also open to both JDs and LLMs offered in the fall, which helps considerably.) For some of the papers, I made available some background readings in the relevant tax policy area, but only the first set of such readings were required. For some of the papers, I find myself lecturing during the class discussion a bit about the background literature — I think that this may have been motivated as much by my sense that they should be fully versed in certain aspects of the tax policy canon as it was by the difficulty of the particular papers.

Our enrollments have been small enough to make this manageable. Some of it would have to be scaled back if enrollments were substantially greater—for instance, by not expecting a question from each student at each author’s presentation.

We have no set expectation for author’s schedule on the day of the presentation, except that the tax faculty (and such others as may be appropriately included) all join the author for dinner.

Northwestern University School of Law has number of colloquia besides the one run by the Graduate Tax Program, so the basic template is fairly well established. We can and do deviate a bit, but the expectations of the wider law school community have generally taken into account in our design.

Structuring a Tax Policy Workshop Series -- UCLA

Kirk Stark, co-host of UCLA's Colloquium on Tax Policy and Public Finance, continues our series on how to best structure a tax policy workshop series:

We started the UCLA Colloquium on Tax Policy and Public Finance in January 2004. From the outset, one of our main objectives was to bring in speakers from a wide range of fields in the hopes of contributing to a dialogue on tax policy that transcends the usual disciplinary boundaries of academia.

Toward that end, we have hosted 56 speakers from several areas of study, including law, government, economics, political science, history and sociology. We also wanted to take advantage of the law school's proximity to other schools and departments here on the UCLA campus. While the workshop is organized each Spring by two of us here in the law school (alternately including Eric Zolt, Kirk Stark, Steve Bank and -- before he left for better weather -- Victor Fleischer), we've been fortunate to have other UCLA faculty regularly involved as well. Most notably, we've benefited greatly from the regular attendance of Al Harberger from our economics department. Al has attended nearly every session since January 2004 and on more than one occasion has graced our whiteboard with his famous triangles.

Our format has varied from year to year. Our typical approach has been to give the author 20-30 minutes to present the paper, followed by 10-15 minutes of remarks from a designated commentator. The commentator is often one of us, but we've also been very fortunate to draw in some our colleagues from other LA schools, including Ted Seto, Ellen Aprill and Katie Pratt from Loyola and Ed McCaffery and Tom Griffith from USC. Like the other tax policy workshops already discussed here on TaxProf, ours is open to students, who are allowed to enroll in the workshop for law school credit. We've gone back and forth on the question of devoting class time to introducing students to the various topics to be covered in upcoming workshops. For example, one semester we interspersed the workshops with two-hour sessions devoted to discussing assigned readings on a particular subject, ranging from tax incidence theory to transfer pricing. At a minimum, we assign students some basic public finance reading (typically from one or more of the public finance textbooks) at the beginning of the semester with an eye toward getting them up to speed on some of the vocabulary of tax policy analysis. In addition, we sometimes assign two or three related articles so that the student have a better sense of the literature in which the author is writing.

We've also experimented with co-hosting our workshop with other workshops here at UCLA. For example, last year we co-hosted a session with Seana Shiffrin's Legal Theory Workshop. The presenter was Rob Reich, a political theorist from Stanford, who presented his work on a political theory of philanthropy, which included an extended critique of tax subsidies for charitable contributions. While it can be hard to coordinate schedules and find authors whose work satisfies both workshops' intended subject areas, our experience suggests that it is well worth the effort.

Probably the best thing about running a workshop like this is the sense that you are participating in a tangible way with the cross-fertilization of ideas in the tax policy community. It's hard to imagine a better way to stay engaged with developments in a field than by devoting several months each year to face-to-face exchanges with leading scholars on their forthcoming work.

Structuring a Tax Policy Workshop Series -- Columbia

Alex Raskolnikov, host of Columbia's Tax Policy Colloquium Series, continues our series on how to best structure a tax policy workshop series:

We've just started a tax policy colloquium at Columbia, so our experience is limited to one year. Both students and faculty participate. To give students some basic understanding of what's about to come, we spend the first two classes lecturing on key tax policy concepts. We also assign a fair bit of "Taxing Ourselves" by Slemrod & Bakija (now in 4th edition). After that, it's a different presenter every week, with students writing short response papers and getting a final grade based on these papers and on their participation in the discussion. It took a considerable effort to convince students to ask questions, but we managed to succeed after two or three sessions. We kept separate queues for students and professors, and alternated between the two queues. This way students were certain to ask their questions, but could also listen how the discussion unfolded among academics. We thought about arranging papers thematically, but it was just too hard given the presenters' timing preferences. We also didn't give systematic feedback to the students, but responded to informal inquiries about the quality of their response papers and in-class questions. I would say that our format is really a faculty workshop with student participation. As long as students understand what they are signing up for (we made sure they did), they end up pretty satisfied with the experience.

Structuring a Tax Policy Workshop Series -- NYU (Student Perspective)

Dave Rifkin (Attorney-Advisor to Tax Court Judge Juan F. Vasquez; Adjunct Professor, Georgetown), a former student participant in NYU's Colloquium Series on Tax Law and Public Finance, continues our series on how to best structure a tax policy workshop series:

Part I:  When I attended NYU's Graduate Tax Program, I took the Tax Policy Colloquium (then taught by David Shaviro and the late David Bradford). Sometimes I found the papers to be accessible and interesting; other times I felt that I didn't have a sufficient knowledge of, or experience with, tax to comment on them critically. There were some papers that I understood the substance of but could not appreciate why they were important.

Profs. Shaviro and Bradford did an excellent job at getting the class up to speed on the substance of the papers, but sometimes the "why this is important or merits examination" was lost just in an effort to get the class up to speed on the subject of the paper (or perhaps because without any experience in tax and without knowledge of current developments in tax I could not appreciate why the paper was written). As Leandra intends this workshop to be for J.D. students, I think she may have a very tough road ahead of her in getting scholarly works that will be manageable for a J.D. with only basic tax and perhaps an additional tax course or two.

Additionally, I remember the afternoon discussions of the papers -- which also were attended by NYU tax faculty, tax faculty of other New York area law schools, and sometimes local tax professionals (who sometimes had devoted a lifetime to the subject of the paper). Virtually every afternoon discussion contained at least one question and answer that went over not only my head, but those of the other students in the class. I think keeping discourse about the papers to a J.D. level will be more difficult than finding papers that the students will be able to digest.

Also, I remember the fear of asking a question that was "stupid" in front of professors and professionals. I recall only asking one question during the "presentation" portion of the colloquium, and I remember it being on a topic that I researched and wrote and independent study paper on as a J.D. student (so I felt comfortable with the material and that I would not embarrass myself). Having students ask questions first (before faculty and other professionals) may be asking too much of J.D. students. Perhaps questions could be vetted in advance with the students proposing the questions during the classroom component? Basic questions could be answered in the classroom setting and questions that merit discussion could be held off until the presentation of the paper (e.g., "Why don't you save that question and ask it to [the presenter].")

I wish Leandra luck on this endeavor. If I may brave another suggestion: Profs. Shaviro and Bradford required my class to write a short paper (I think it was 1-5 pages) in response to each paper that was presented in the colloquium, but gave us the option to take a "pass" on one paper. I suggest she adopt the same "one pass rule" to allow students the opportunity to avoid having to write on every paper submitted (even if it is simply to allow students to maintain their dignity by not forcing them to write something about which they have nothing to say).

Part II:  It is interesting to read some of the responses you have posted. It has made me reflect upon my earlier email regarding my experience at NYU.

Before attending NYU's Graduate Tax Program, I had taken a significant number of tax classes, including Tax Policy course taught by Prof. Linda Sugin. I came to the Colloquium with 16 J.D. tax credits and 1 semester at NYU's LL.M. program. As I stated previously, even so I found many of the papers presented challenging and even after discussing them in class I had little to add to the discussion that followed.

I am confused, however, by professors finding the pedagogical need for students to participate in the "presentation" portion of the colloquium. I learned so much by listening to others question, reflect, and argue about the paper I had read. As I said, there was usually a question or 2 that was beyond me (and perhaps the rest of the class too), but this was over the course of a 2 hour presentation, discussion, critique, and defense of the paper. Many insightful questions and answers were presented and discussed, and I got much more out of this than if the presenter had had to answer some basic questions asked by the students. Often the discussion developed in ways I could not have anticipated and I would not have have benefited from this had discussion been retarded by devoting a substantial portion of the discussion to answering student's questions.

I believe students can learn as much or more by listening to others discuss a subject as they can by participating in the discussion. I believe that if a student has a question worth asking in a colloquium that it will get asked. That was my experience without having a "student's first" rule in place. I think pedagogically a "student's first" rule might put undue pressure on the students to ask questions ("volunteering" only in the Army sense of the word), could reflect poorly on the professor (e.g., "THOSE were the questions the students had?" or "the students didn't have ANY questions after preparing for 2 weeks?"), and could be a time black hole. The presenter and the audience would better served by a discussion developing naturally, rather than by "forced" questioning by the students, of the paper presented. Hopefully, the students will listen (sans laptop) to the discussion, learn, and if they have a question ask it.

Structuring a Tax Policy Workshop Series -- NYU (Co-Convenor's Perspective)

Daniel N. Shaviro, co-convenor of NYU's Colloquium Series on Tax Law and Public Finance, continues our series on how to best structure a tax policy workshop series:

NYU had the first tax policy colloquium, for which I must thank John Sexton, our dean at the time when I was considering moving from Chicago to NYU. John put me in touch with David Bradford and suggested that we introduce a colloquium along the lines of the Dworkin-Nagel law and philosophy colloquium at NYU. Ours remains fairly unique among tax colloquia that I have attended, in that we don’t have the author present the paper but plunge right into directed discussion in the public afternoon session (which comes after a two-hour morning session with the students followed by lunch with the speaker).

Done right in circumstances where it’s feasible, I believe this is the best approach, but there are a number of preconditions for it to be feasible. The conveners (there really have to be at least 2 for it to work well) have to be ready, willing, and able to take on all topics. They have to have enough time (which depends in part on the teaching credits they get) to be able to spend a great deal of time thinking about the issues. They have to spend enough time with the author in advance of the session, in a collegial spirit that avoids being either too deferential or too confrontational, to make the public discussion a shared enterprise based on having cleared away all initial misunderstandings. And they have to have a sufficiently large and lively audience, with a culture of participation, so that the audience doesn’t sit there thinking: “Why do we need to listen to these guys again instead of hearing the author, who is here just for the day?” When I am the discussion leader (I take turns with my partner), then even if I have lots of things to say I try to keep in mind the maxim “Jason Kidd, not Stephon Marbury.” In other words, try to facilitate discussion not dominate it, and get things to the audience fairly swiftly but having suggested guidelines that will shape what comes next.

Done right, you crisply tee up a few key issues for in-depth discussion, focusing on one issue at a time, using the paper as a starting point, and the audience gets a richer experience than they would from listening to a summary that merely repeats what the paper already said. Done wrong, you can bet that the audience will vote against you over time with its feet.

Those are the basics of the afternoon session as we do it at NYU. We prepare discussion notes, typically with 3 main topics and a few central points about each. At lunch this can all change due to discussions with the author, but at 4 pm we do it as revised, keeping each point short, with the author responding each time and then the audience chiming in. Sometimes we fail to move on as swiftly as we should to cover all of the topics, but that’s a lesser sin than cutting off lively audience discussion prematurely.

The central aim of the afternoon session is not to assess the paper, or even to tell the author what to do with the paper (though this usually happens). Rather, it is to advance, through dialogue and collective effort, all of our thinking about the topics discussed in the paper. In doing so, we try to combine accessibility to students with cutting edge content for the legal and other academics, practitioners, etc., in the room.

The aim of having an advanced discussion while also including and enlightening the students would be unachievable if the afternoon session was all we had. In our morning session, however, our aim is to provide the students with as full a background as possible on the literature and ideas that underlie the paper. Indeed, the aim of the AM session is not to do a dry run of the PM session but rather to equip the students to understand and follow it.

We also have every student participate in one AM class as a discussion leader (usually with one other student) who prepares an outline just for us that we review with the preparer(s) in advance but don’t grade. Rather, the grade is based on critique papers, assessing and responding to the week’s reading, that are due at the start of the AM class. Students are required to write 5 papers of about 6 to 8 pages (the details of this vary with the year) and can choose whichever weeks they like. One of the key pedagogical features of the class is that we write comments back to the students concerning their critique papers, often 2 or 3 pages long, containing a grade but also offering not just an assessment of how good a job the critique paper did but further thoughts on the issues it raised.

The day’s final event is a dinner, typically with 7 to 9 people including the authors, the conveners, and usually 1 to 3 students along with academics, practitioners, etcetera, who have attended the PM session. In addition to being enjoyable (given that we are in lower Manhattan, our motto is “14 weeks, 14 different places”), we also aim both to further pursue the PM session and to advance our aims of creating a tax policy discussion community where people inside and outside NYU, including students, make lasting connections with others.

One final point about our design is that it aims to be inter-disciplinary. I always co-teach it with an economist, and we exhibit some inclination to have the economists comment on more law-based papers while I comment on more economics-based papers. While we mainly invite law professors (and an occasional legal practitioner) and always try to keep in mind readability for the students and broader legal audience, we always have several papers by economists, and also invite political scientists and philosophers when they have suitable papers. Among invited law professors, we aim for a mix that includes junior people. We also interpret “tax policy” broadly to include, for example, budgetary issues, entitlements, transfers, and even topics such as regulatory mandates if they appear sufficiently “tax-like” for our discussion purposes.

Structuring a Tax Policy Workshop Series -- Toronto

Ben Alarie and David Duff, co-hosts of the James Hausman Tax Law and Policy Workshop Series at the University of Toronto, continue our series on how to best structure a tax policy workshop series:

The James Hausman Tax Law and Policy Workshop began at the Faculty of Law of the University of Toronto in the fall of 2004. The primary motivation behind the workshop is to increase the profile and circulation of innovative and emerging tax research at the law school and, to the extent possible through this type of forum, the broader tax community. A number of secondary motivations surrounding the workshop include: (a) promoting the pedagogical value of exposing all interested students to the latest tax research; (b) generating useful feedback for our invited guests in the form of written student comments; and (c) solidifying the desirability of the law school for JD and graduate students who are interested in studying tax law and policy. The primary motivation of the workshop — to increase and profile and circulation of innovative and emerging tax research at the law school — in my view has been and remains dominant as we approach its fifth year.

While the workshop is open to all members of the law school community (and beyond), it is offered for credit to a limited number of upper year JD and graduate students (maximum enrollment is 10), all of whom must have taken at least the introductory income tax course, and are encouraged to take additional tax courses as well. The workshops are usually held every two to three weeks throughout the year. Students enrolled in the workshop for credit prepare short written responses to the papers that are presented, and produce a longer tax policy paper at the end of the course on a topic of their own choosing. In keeping with the primary motivation of the workshop, there has not been a preoccupation with an overall theme or with establishing a logical course of development from one workshop to the next; instead, the workshop strives simply to attract those who are doing important and influential work in tax law and policy to Toronto. We are extraordinarily grateful to the friends and family of James Hausman who continue to honour his life and work by providing financial support to the workshop. Without them, the workshop would not be possible.

Structuring a Tax Policy Workshop Series -- Loyola-L.A.

Ellen Aprill, Jenny Kowal, Katie Pratt, and Ted Seto, co-hosts of Loyola-L.A.'s Tax Policy Colloquium Series, continue our series on how to best structure a tax policy workshop series:

We all suggest Colloquium speakers, participate in the weekly Colloquium discussions, host the visiting speakers, and organize a faculty dinner for each speaker. Other Loyola faculty (tax and nontax, full-time and adjunct) and professors from other Southern California schools also attend the Colloquium. The Colloquium is open to Tax LLM students and JD students who have completed Income Tax I, but enrollment is limited. Interested students must submit an application (cover letter, resume, and transcript) to Katie and Ted. (Last fall, we selected a dozen students for the Colloquium.)

We invite a diverse group of tax scholars to present Colloquium papers. Also, we try to select an interesting cross-section of paper topics. (Some of the papers are quite complex, but we believe the students are capable and will learn from the challenge.) We also arrange for a formal Commentator for each presentation. Our Commentators typically come from Southern California (law schools or RAND), but we sometimes invite Commentators from outside Southern California.

At the start of the term, Katie and Ted give the students a 100-page Tax Policy primer (with article excerpts and material we drafted) to introduce terms and concepts. We also provide an overview of this introductory material in the first two Colloquium class meetings. In addition, we give the students a list of questions to consider as they read the Colloquium papers: (1) what problem is the author addressing? (2) what is the thesis of the paper? (3) which normative approaches or tools is the author using (implicitly or explicitly) to address the problem? (4) how does the author conceptualize the role of the IRC? (5) is the author’s proposal an ideal proposal or a real proposal? and (6) is the proposal politically viable?

After two weeks of course introduction, Colloquium speakers present papers in the weekly class meetings. (Our approach is to have a paper presentation each week, not every other week; we do not discuss the papers with our students before the presentations.) The students read all of the draft papers and submit three written questions to Katie and Ted before each presentation. The format for each Colloquium presentation is like a faculty workshop, but with a longer Q & A period; the Colloquium speaker presents the paper for about a half hour; the Commentator responds for 10-15 minutes; the discussion takes up the rest of the two-hour class session. The Colloquium students ask questions, comment on the papers, and participate fully in the discussions. Several of the fall 2007 Colloquium speakers remarked that the student comments were quite thoughtful and interesting.

The Colloquium students also write four reaction papers (of 8-12 pages each) over the term. Two of the reaction papers are pre-presentation papers and two are post-presentation papers. We assign the reaction papers based on the students’ preferences. (In our first class meeting, we distribute the list of Colloquium presentation topics and ask the students to rank the topics according to their preferences.) We try to allocate the reaction paper assignments evenly across the various papers being presented.

Grades are based on: (1) the four reaction papers, (2) the written questions submitted weekly, and (3) class participation. There is no final exam.

Structuring a Tax Policy Workshop Series -- Texas Tech

Bryan Camp (Texas Tech) offers his perspective as the convenor of a non-tax workshop series at Texas Tech, as part of our series on how to best structure a tax policy workshop series:

I LOVE colloquia! We did them at my undergrad (Haverford), and I did several in my grad work in history. I run one here at Texas Tech every other year, ostensibly on the topic of slave law, but more abstractly on consideration of a lawyer's proper role in an immoral legal system. From this experience I offer several ideas:

1. Focus on basics. Often, the best learning and the best advancement in learning comes through re-examination of first principles. This is where students are very helpful because they bring to THEIR learning of first principles a whole different set of preconceptions that those of us who have been around bring to the table. Basic questions are opportunities to test and retest assumptions. I do not think you can select articles that are "too" basic to generate a good start.
2. Give all participants a shared vocabulary. As a corollary to (1) I like to choose readings for the first 3-4 weeks that give the group access to common vocabulary so that we can quickly start to move to more efficient communication patterns.
3. Don't always choose the "best" articles. I actually like to use articles that may have some serious deficiency, because that really generates good discussion. You can structure a good discussion around the deficiency (debating whether it really is a deficiency and, if so, what the consequences are for the article's thesis or future work).
4. Require all participants to turn in at least three thoughtful questions about the readings and use those questions to structure the discussion. This helps moderate discussion because you have basically a list of stuff each person is ready to talk about. This also really works well when you designate students as the discussion leaders. It helps them find focus and structure and keep the class from becoming just a beery bull session. It also allows discussion leaders to keep the "gunners" in line: they can always switch to a question from someone else.
5. Designate one or two participants to write a 10 page paper (no longer!) critiquing one of the readings for the week and designate another participant (or two) to be the designated "defenders" of the critiqued work. This takes some advance planning because the papers need to be distributed the week before the discussion takes place. The idea is that the class will read the designated works for the week and at the same time read one or two of their colleague's thoughts/critiques on the matter.

Those are some ideas that I think really help make a colloquium work well. Yep, I just LOVE colloquia!

Structuring a Tax Policy Workshop Series -- Boston College

Jim Repetti and Diane Ring, co-hosts of Boston College's Tax Policy Workshop Series, continue our series on how to best structure a tax policy workshop series:

The Boston College Law School Tax Policy Workshop Series involves guest speakers presenting their papers to faculty from BC and other Boston area schools, BC alumni who are tax practitioners or government policymakers, and students who have a strong interest in tax.

Papers for each workshop are emailed to participants at least one week in advance. We limit the number of attendees to 20 and seat everyone around one large table in order to maintain an informal and relaxed atmosphere. After lunch is served, the presenter speaks for about one half hour followed by discussion and questions for another hour.

This was our first year running the workshop. We had had a great time, learned a lot, and enjoyed the company of wonderful guest speakers. Even our non-tax faculty have commented how much they have enjoyed the workshops!

Structuring a Tax Policy Workshop Series -- UConn

Ruth Mason, host of UConn's Tax Lecture Series, continues our series on how to best structure a tax policy workshop series:

Established in 2006, the University of Connecticut Tax Lecture Series is not a formal course. Instead, throughout the year, we have invited three to four tax faculty members from other schools, aiming for two lectures in the fall and two in the spring. Lectures are open to the whole law school community, and student participation has been fairly active, in part because the tax faculty strongly encourages our students to attend, and the paper is available at least a week in advance of the lecture. I also ask the students in my classes who will attend the lectures to write out questions in advance of the lecture, which I think has contributed to the high quality of the discussion. Additionally, when a lecture touches on other areas of law, I usually contact the relevant faculty member. So, for example, when Michael Tumpel of Johannes Kepler University in Linz talked about indirect taxation in the European Union, I contacted my colleague Willajeanne McLean, who teaches EU law. She asked her students to attend the lecture, which produced an informed audience. Since the lecture series is not a formal course, the students do not have the benefit of the kind of advanced discussion that takes place at NYU or Indiana.

Structuring a Tax Policy Workshop Series -- Penn

Michael Knoll, Chris Sanchirico, and Reed Shuldiner, co-hosts of Penn's Tax Policy Workshop Series, continue our series on how to best structure a tax policy workshop series:

At Penn, we have been running our tax policy workshop since 2002. Each year, we invite roughly half as many academic speakers as there are class sessions. That generally means we have only five or six paper presentations. The week before each speaker's presentation one of us presents a lecture on the topic area of the speaker's paper. Before attending that preparatory lecture the students have read a set of background materials. The readings are intended to situate the speaker’s paper within the existing literature or introduce the students to some of the tools used by the speaker. We find that providing both background readings and a preparatory lecture for each speaker greatly raises the level of student interest and the quality of student questions and comments at the speaker's presentation.

The day of the presentation, we take the speaker to lunch or coffee before the talk. At that point, we ask our own questions, provide our own comments and generally engage the presenter in a lengthy discussion of the paper. At the presentation itself, we rarely interject ourselves, but rather we try to leave the hour and half to student comments and to the comments of other faculty who might be in attendance.

After the presentation, we take the speaker out to dinner and continue our discussion from lunch, adding interesting topics that arose during the presentation.

Students are required to write short reaction papers on four of the five speakers. Later in the semester we give them the opportunity to rewrite one of the papers.

Each year we have run the workshop, we have added one speaker from the government. Usually, the government speaker is a current senior tax official with substantial policy experience. The government speaker is usually off of the regular calendar to accommodate the speaker’s schedule and late in the semester. Although we give the government speaker the option to present a paper or assign readings, that option is rarely taken. Accordingly, we do not conduct a preparatory lecture for the government speaker.

Structuring a Tax Policy Workshop Series -- Michigan

Reuven Avi-Yonah, host of Michigan's Tax Policy Workshop Series, continues our series on how to best structure a tax policy workshop series:

Our Tax Policy Workshop is loosely modeled on NYU's, except that the authors get to present their own papers. It is attended by students and faculty from law, economics and business. The speaker presents for about half an hour and then we have an open discussion. Two recent innovations have been to enforce a rule that students get to speak first (otherwise faculty tend to dominate the discussion), and to have a preparatory session with students the week before the speaker presentation (so that we only have six or seven presenters each year other than thirteen). Over the years since 2002, we have been able to hear many of the top names in the field, including both lawyers and economists. We try not to have too many repeat players, so as to open the opportunity to as wide a field as possible. I think we all feel the series has been a successful contribution to the intellectual life of the law school and to our students, including both the JDs and the tax LLM students (for whom it is a required course).

Structuring a Tax Policy Workshop Series -- Indiana

Leandra Lederman (Indiana) kicks off what I hope will be an extended discussion about how to best structure a tax policy workshop series:

Paul asked me to kick off a discussion about tax workshop series in which students participate; Indiana-Bloomington recently considered and adopted a proposal for a Tax Policy Colloquium, which we will launch next spring. Like colloquia at other schools, it will be structured as a class for students in which faculty will also participate. I proposed the colloquium partly because Indiana-Bloomington recently adopted a strategic plan that highlights the importance of scholarship and has among its goals (1) the inclusion of students in our intellectual community by bringing faculty scholarship into the classroom, and (2) the development of forums for intensive intellectual exchange within the faculty. My colleague Ajay Mehrotra plans to run the colloquium in alternate years. It will be open to our full faculty, and we will also invite our adjunct tax faculty, tax faculty from the Kelley School of Business, and faculty in other schools on campus who are interested in tax policy issues.

Indiana does not have a tax LL.M. program, so the colloquium will be structured with that in mind. Students will be required to write a short reaction paper in response to each paper that is presented in the colloquium, and, as is customary, those reaction papers will be shared with the presenters. Income Tax will be a prerequisite, and we are planning to experiment with an invitation/permission-of-the-instructor format, in order to recruit students with the interest and commitment necessary to make the colloquium a success. We also concluded that it would be best to have speakers only in alternate weeks so that we can first discuss the speaker’s paper as a class, to help prepare the students for the discussion with the speaker.

Perhaps the trickiest issue about a course like this is to balance pedagogical needs with the needs of presenters. With respect to the pedagogical component, I plan to encourage students to ask their questions first and faculty to hold their questions until students have had a chance to participate. In addition, I intend to try, as much as possible, to select papers that will be accessible to the students. For example, many individual federal income tax topics would be a natural fit, particularly for early in the semester. Ajay and I have also discussed assigning background reading to familiarize the students with the relevant literature. With respect to the presenters, for their experience to be a really good one, I think faculty participation is essential. Before proposing the colloquium, I ascertained that Ajay; Bill Popkin; and our Assistant Dean for Research, Archana Sridhar, who is a tax specialist, would all be interested in participating on a regular basis, and at least a few other faculty would be interested in attending periodically. To involve as many interested faculty as possible, we will try to select some papers that fit within their areas of interest, such as business tax papers that will interest Kelley School faculty, so long as the topics will be reasonably accessible to the students.

I have no doubt that this will be a learning process, but it is one that my colleagues and the students I have talked to are excited about. I look forward to hearing from others and learning from their experiences.