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Wednesday, March 11, 2015

Columbia Journal of Tax Law Publishes New Issue

Columbia Journal of Tax Law LogoThe Columbia Journal of Tax Law has published  Vol. 6, No. 1:

March 11, 2015 in Scholarship, Tax | Permalink | Comments (0)

Miller & Chevalier Releases Tax Policy Forecast Survey: Only 5% Expect Tax Reform in 2015

2015 Tax Survey Report CoverMiller & Chevalier (Washington, D.C.) and the National Foreign Trade Council today released their 2015 Tax Policy Forecast Survey measuring the current perspectives and attitudes of leading corporate tax executives on the direction of tax policy in the coming year:

In last year’s survey, a majority (71 percent) of respondents said that Republican control of both the House of Representatives and the Senate would tip the scales in favor of tax reform in 2015. But while the November elections brought that political change, our respondents now expect the stalemate between Congress and the White House to sink the chances for meaningful tax reform this year and next. While newly minted tax-writing-committee chairmen Rep. Paul Ryan (R-WI) and Sen. Orrin Hatch (R-UT) have both said they consider tax reform a top priority, our respondents believe the administration will halt any and all congressional action.

However, for the first time in years, respondents do see a glimmer of hope on the horizon. Almost half (49 percent) say that tax reform will be enacted in 2017 — after the next presidential election. If and when tax reform does happen, 53 percent of respondents believe the most important issue to address will be the high statutory tax rates.

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March 11, 2015 in Tax | Permalink | Comments (0)

Sugin: Rethinking the Tax Consequences of Naming Rights in Light of David Geffen’s Gift for Avery Fisher Hall

AveryFollowing up on my previous post, The Tax Consequences of the Lincoln Center's Naming Rights:  New York Times op-ed:  Your Name on a Building and a Tax Break, Too: Rethinking Taxes and David Geffen’s Gift for Avery Fisher Hall, by Linda Sugin (Fordham):

Last week, the entertainment mogul and philanthropist David Geffen promised $100 million toward the renovation of Avery Fisher Hall, the home of the New York Philharmonic, which will be renamed Geffen Hall.

Several years ago, two other $100 million gifts renamed two more key cultural centers: the main New York Public Library, now called the Stephen A. Schwarzman Building, and the New York State Theater, now called the David H. Koch Theater.

When most of us make gifts to charity, we are allowed to deduct those gifts on our taxes, just as big philanthropists can. Deductions for gifts to the arts are appropriate because donors finance public goods and allow others to pay less for music, dance and even literature. But Congress could do more to encourage current philanthropy — with an eye to encouraging more philanthropy in the future — by revising the way tax law treats naming rights.

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March 11, 2015 in Tax | Permalink | Comments (0)

TRAC-IRS: The IRS and the April Surprise

The Transactional Records Access Clearinghouse at Syracuse University has released The IRS and the April Surprise:

TRAC-1Analysis of the latest government case-by-case data obtained by the Transactional Records Access Clearinghouse (TRAC) at Syracuse University shows that during January 2015 a total of 131 taxpayers were prosecuted as a result of IRS investigations.

The data tracking trends also show that many IRS prosecutions are timed to coincide with tax filing season, presumably to help remind taxpayers of their legal obligations to avoid underreporting taxes owed on the returns they file.

Year after year, April consistently has the greatest number of criminal prosecutions as a result of IRS investigations — two-thirds or more higher than those seen in January. Figure 1 and Table 1 show both the 10-year average as well as prosecution figures from January through December 2014.

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March 11, 2015 in IRS News, Tax | Permalink | Comments (3)

Vote for 2015's Best Tax Blog

Wallet

WalletHub, 2015’s Best Tax Blog Contest:

It’s time to find the Best Tax Blogs the Internet has to offer! WalletHub’s Editors have identified 50 finalists, from industry titans like TurboTax to one-man dynamos like the Tax Girl. Now it’s your job to vote. Tell your friends, alert the neighbors and show us why your favorite website deserves the title of 2015’s Best Tax Blog.

To vote for your favorite tax blog, go here.

March 11, 2015 in About This Blog, Tax | Permalink | Comments (0)

What America Thinks: Tax Season

Rasmussen 2Rasmussen Reports, What America Thinks: Tax Season:

They say only two things are certain in life: death and taxes. It doesn’t mean we have to like either one. Tax season is unavoidably upon us again, so we decided to find out what America thinks.

When asked which is worse, going to the dentist or filing their income taxes, it’s a close call. Nearly half of Americans would rather sit in the dentist’s chair than do tax paperwork. Nonetheless, most plan to file their income taxes by the April 15 deadline, and a third have already filed. Forty-three percent (43%) expect a refund this year, and they're the most likely to have filed already. Very few Americans worry about getting audited by the IRS.

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March 11, 2015 in Tax | Permalink | Comments (0)

The IRS Scandal, Day 671

IRS Logo 2Washington Post, Clinton’s E-mail Drama Is Acted Out on the World Stage:

Several days before the world found out that Hillary Clinton used a private e-mail account exclusively for all communication as secretary of state, including work-related conversations, a Republican congressman sought to bar Internal Revenue Service employees from using their non-official e-mail for government business.

Rep. Kenny Marchant (R-Tex.) introduced a bill on Feb. 27 directed at the IRS and intended to address allegations that former IRS official Lois Lerner used her personal account to discuss IRS matters. A House Republican-conducted report released in March 2014 said: “Her willingness to handle this information on a non-official e-mail account highlights her disregard for confidential taxpayer information.”

Marchant’s somewhat prescient legislation highlights a loophole in the Federal Records Act. While employees of the federal government are discouraged from using personal e-mail, it’s not barred. The law was updated in late 2014 to say that if personal e-mail is used for work, it must be turned over to be officially archived within 20 days.

In September 2014, during a House Oversight Committee hearing on the Lerner e-mails, IRS Commissioner John Koskinen said it’s policy not to use personal e-mail.

“One of the things we’re doing is making sure everybody understands that you cannot use your e-mail for IRS business,” he said. “That’s been a policy; we need to reinforce that.”

But the IRS employee manual says only that “sensitive but unclassified” data can’t be e-mailed outside the IRS network — there’s nothing about an outright prohibition.

In the case of Lerner, House Republicans wanted her e-mails during their investigation into whether the IRS had targeted nonprofits for their political leanings when considering tax-exempt status.

Though the Clinton story shone a light on the federal government’s e-mail policy, Marchant’s office said he doesn’t have any plans to expand the bill to prohibit official business on all feds’ personal e-mail accounts.

Human Events, No One in Government Knows How to Use Email — Except Hillary Clinton:

[R]evelations that former Secretary of State Hillary Clinton used her private email address, hdr22@clintonemail.com, during her tenure to conduct State Department business, [brought] the topic of email and Internet security back into the national limelight. ... A public probing of Clinton’s email set-up has revealed a staggering ignorance on the part of government officials when it comes to email specifically, and technology more generally. ...

A much bigger technological foul on the part of the government is the scandal surrounding the Internal Revenue Service’s handling of the emails of Lois Lerner, the former director of the Exempt Organizations Unit.

Faced by the House Committee on Oversight’s investigation into its alleged targeting of tax-exempt conservative nonprofit organizations, the IRS claimed to have lost up to two years’ worth of Lerner’s emails.

How could this be possible?

Because of a “computer crash,” IRS officials claimed. And any back-ups were automatically deleted, said IRS Commissioner John Koskinen. This, despite the fact that emails are stored on cloud servers and were explicitly required by law to be recorded and backed up in a secure location.

Months later, it’s now been revealed those emails are not only recoverable, but an archive of up to 33,000 emails, up to 10 years’ worth, were easily found by a separate department.

Tim Camus, deputy inspector general of the Treasury Department, said finding the emails was done without issue. “They were right where you would expect them to be,” he told the Oversight Committee on Feb. 27.

Federal officials are now probing for potential criminal activity related to the covering-up of Lerner’s emails.

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March 11, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, March 10, 2015

Yin Presents Protecting Taxpayers from Congressional Lawbreaking Today at NYU

Yin (2015)George K. Yin (Virginia) presents Protecting Taxpayers from Congressional Lawbreaking at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Alan Viard:

This paper describes how the U.S. House Ways & Means Committee broke the law in 2014 when it approved public release of the confidential tax return information of 51 taxpayers. Because the Speech or Debate Clause insulates the legislators and their staff from prosecution if they carry out their violation in the context of a protected legislative act, to prevent a future violation, the paper recommends a new restriction on the access of the tax committees to tax return information.

March 10, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Tax Revenues in 30 States Are Below Pre-Recession Levels

Wall Street Journal, Many States' Tax Receipts Remain Depressed:

The recession ended more than five years ago, but the financial squeeze left by the downturn lives on for a majority of states.

Government revenues have been slow to recover across the country as sales-tax collections fall prey to many of the same forces buffeting the broader economic expansion, from cautious consumers who have seen scant growth in wages to a downturn in home construction that has sapped sales of building materials and furnishings. At the same time, states are facing down a decades-long shift in the economy to services from goods, leaving them to collect taxes on a shrinking number of purchases.

Nationally, sales-tax receipts last year reclaimed levels—on an inflation-adjusted basis—seen in late 2007 as the recession arrived. So while a highly unequal national recovery has lifted federal tax revenues, thanks to an upswing in earnings among corporations and the rich, states—which rely not just on incomes, but also the spending of average citizens—continue to struggle.

There are 30 states still collecting less in taxes, adjusted for inflation, than when the recession hit, according to a Pew Charitable Trusts study that examined the data through September. Income-tax collections grew on a real basis by 7.1% since late 2008, while sales-tax receipts rose by 1%, according to an analysis by Nelson A. Rockefeller Institute of Government at the State University of New York.

WSJ 1

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March 10, 2015 in Tax | Permalink | Comments (1)

Forman & Sabin: Tontine Pensions

Jonathan Barry Forman (Oklahoma) & Michael J. Sabin, Tontine Pensions, 163 U. Pa. L. Rev. 755 (2015):

Tontines are investment vehicles that can be used to provide retirement income. A tontine is a financial product that combines the features of an annuity and a lottery. In a simple tontine, a group of investors pool their money together to buy a portfolio of investments and, as investors die, their shares are forfeited, with the entire fund going to the last surviving investor. Over the years, this “last survivor takes all” approach has made for some great fiction. For example, in an episode of the popular television series M*A*S*H, Colonel Sherman T. Potter, as the last survivor of his World War I unit, got to open the bottle of French cognac that he and his buddies bought (and share it with his Korean War compatriots).

On the other hand, sometimes the fictional plots involved nefarious characters trying to kill off the rest of the investors to “inherit” the fund. Of course, tontines can be designed to avoid such mischief. For example, instead of distributing all of the contributions to the last survivor, a tontine could make periodic distributions. Indeed, tontines could be used to create “tontine annuities” that could be sold to individual investors. These tontine annuities would make periodic distributions to surviving investors, but unlike traditional tontines, tontine annuities would solicit new investors to replace those that have died. Structured in this way, a tontine annuity could operate in perpetuity.

In this Article, we consider how the tontine principle could be used to create “tontine pensions” through which large employers could provide retirement income for their employees. These tontine pensions would have several major advantages over most of today’s pensions, annuities, and other retirement income products.

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March 10, 2015 in Scholarship, Tax | Permalink | Comments (0)

Senate Holds Hearing Today on Tax Complexity, Compliance, and Administration: The Merits of Simplification in Tax Reform

Senate LogoThe Senate Finance Committee holds a hearing today on Tax Complexity, Compliance, and Administration: The Merits of Simplification in Tax Reform (links to statements and testimony below):

  • Orrin Hatch (R-UT), Statement
  • Ron Wyden (D-OR), Statement
  • Carol Markman (CPA & Tax Director, EP Caine & Associates), Testimony
  • Mihir Desai (Professor, Harvard Law School), Testimony
  • Bruce Bartlett (Former Deputy Assistant Secretary, U.S. Treasury Department), Testimony
  • Keith Fogg (Professor and Tax Clinic Director, Villanova Law School), Testimony

In connection with the hearing, the Joint Committee on Taxation has released Complexity In The Federal Tax System (JCX-49-15):

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March 10, 2015 in Congressional News, Tax | Permalink | Comments (0)

NY Times: Greece Proposes Using Tourists as Tax Spies to Fill Revenue Shortfall

New York Times, Greece Proposes Using Tourists as Tax Spies to Fill Shortfall:

Despite the European accord last month to extend a financial lifeline to Greece, Athens is rapidly running out of cash.

So it is scrambling to find new, even radical ways to fill the shortfall — including a proposal to recruit citizens and tourists to spy on suspected tax evaders. ...

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March 10, 2015 in Tax | Permalink | Comments (0)

Blank: Reconsidering Corporate Tax Privacy

Joshua D. Blank (NYU), Reconsidering Corporate Tax Privacy, 11 N.Y.U. J. L. & Bus. 31 (2014):

For over a century, politicians, government officials and scholars in the United States have debated whether corporate tax returns, which are currently subject to broad tax privacy protections, should be publicly accessible. The ongoing global discussion of base erosion and profit shifting by multinational corporations has generated calls for greater tax transparency. Throughout this debate, participants have focused exclusively on the potential reactions of a corporation’s managers, shareholders and consumers to a corporation’s disclosure of its own tax return information. There is, however, another perspective: how would the ability of a corporation’s stakeholders and agents to observe other corporations’ tax return information affect the corporation’s compliance with the tax law?

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March 10, 2015 in Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 670

IRS Logo 2Washington Times, Hillary Clinton Scandal Spreads as Tea Party Group Seeks Private IRS Emails:

One of the tea party groups targeted by the IRS asked Congress Monday to demand the private emails of some agency employees, while a top committee chairman issued a request for instant-chat messages from the EPA, as the Clinton emails scandal begins to envelop other parts of the Obama administration. ...

One of the tea party groups targeted by the IRS asked Congress Monday to demand the private emails of some agency employees, while a top committee chairman issued a request for instant-chat messages from the EPA, as the Clinton emails scandal begins to envelop other parts of the Obama administration.

Ms. Engelbrecht said in light of the revelation that former Secretary of State Hillary Rodham Clinton used her own private email address and server to conduct official department business, the congressional committees investigating the IRS should pry more deeply into whether any agency employees did the same.

“Former Secretary Clinton’s latest news regarding third-party email use is just a continuation of a thriving culture of concealment within the Obama administration, which is growing increasingly apparent to the American public,” Ms. Engelbrecht said.

Emails from former IRS employee Lois G. Lerner, a central figure in the investigation, have already become a flashpoint in Congress‘ probe into the tax agency, with an inspector general last month saying investigators were quickly able to find backup tapes to restore some of Ms. Lerner’s lost emails, despite the IRS insisting the emails were irretrievably gone.

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March 10, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Monday, March 9, 2015

Hellwig Presents The Constitutional Nature of the U.S. Tax Court Today at Indiana

HellwigBrant Hellwig (Dean (as of July 1, 2015), Washington & Lee) presents The Constitutional Nature of the United States Tax Court at Indiana today as part of its Tax Policy Colloquium hosted by Leandra Lederman:

Is the United States Tax Court part of the Executive Branch of Government? One would expect that question would be capable of being definitively answered without considerable difficulty. And as recently expressed by the Court of Appeals for the District of Columbia Circuit, that indeed is the case. In the course of addressing a challenge to the ability of the President to remove a judge of the Tax Court for cause on separation of powers grounds, the D.C. Circuit rejected the premise that the removal power implicated two branches of government: “The Tax Court exercises Executive authority as part of the Executive Branch.” [Kuretski v. Commissioner]

This article will examine the Kuretski decision, using this case as a vehicle to examine the constitutional nature of the Tax Court.

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March 9, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Elizabeth Chamblee Burch, Michael Simkovic Awarded ALI Young Scholars Medals

BurchThe American Law Institute Announces Young Scholars Medal Recipients:

The American Law Institute has announced that the Young Scholars Medal will be awarded this year to two exceptional law professors— Elizabeth Chamblee Burch of the University of Georgia School of Law and Michael Simkovic of Seton Hall University School of Law. The award is presented every other year to one or two outstanding early-career law professors whose work has the potential to influence improvements in the law.

Justice Goodwin Liu of the California Supreme Court, who chairs of the Young Scholars Medal Selection Committee, will present the awards on Monday, May 18, at the ALI Annual Meeting in Washington, DC. "We are extremely proud of this year’s Medal recipients," said Justice Liu. “These two exceptional professors have produced first-rate scholarship that is already having an impact in legal debate and policy. Professor Burch’s work provides an innovative analysis of strategies for solving principal-agent problems in aggregate litigation, and Professor Simkovic's research on consumer finance and credit markets has influenced courts, regulators, fellow researchers, and the United States Congress.”

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March 9, 2015 in Legal Education, Scholarship, Tax | Permalink | Comments (0)

Listokin: Tax Expenditure Estimates Approximate Revenue Estimates

Yair Listokin (Yale), Tax Expenditure Estimates Approximate Revenue Estimates, 145 Tax Notes 701 (Nov. 10, 2014):

Tax expenditure estimates are viewed with skepticism even within the fraught business of forecasting the revenue effects of policies. As the Joint Committee on Taxation emphasizes, ‘‘Unlike revenue estimates, tax expenditure estimates do not incorporate any behavioral response of taxpayers or changes in the timing of tax payments.

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March 9, 2015 in Scholarship, Tax | Permalink | Comments (1)

Johnson: How Far Does Circular 230 Exceed Treasury's Statutory Authority?

Steve Johnson (Florida State), How Far Does Circular 230 Exceed Treasury's Statutory Authority?, 146 Tax Notes 221 (Jan. 12, 2015):

Treasury regulations defining the duties of those practicing before the IRS, commonly called Circular 230, are a cornerstone of federal tax practice. Recent judicial decisions, however, raise the genuine possibility that substantial portions of Circular 230 may be invalidated if challenged. 

March 9, 2015 in Scholarship, Tax | Permalink | Comments (0)

Kahn & Kahn: Cancellation of Debt and Related Transactions

Douglas A. Kahn (Michigan) & Jeffrey H. Kahn (Florida State), Cancellation of Debt and Related Transactions, 68 Tax Law. ___  (2015):

If a taxpayer borrows money, the borrowed funds are not included in the taxpayer’s gross income. That treatment is proper even though the taxpayer has increased his assets by the amount he borrowed since he has also has created a corresponding liability to pay back the loan. The taxpayer’s net wealth has not increased. The more difficult and interesting questions arise when the taxpayer fails to repay the loan. At first blush, it would appear that upon cancellation of a loan, the taxpayer should have income for the amount that was canceled. However, the current tax treatment that simple. A number of exceptions exist to the straightforward treatment under which the cancellation requires the taxpayer to recognize income. Some of those exceptions reflect an application of normal tax principles while others exist for programmatic purposes. Those exceptions make the tax treatment of cancellation of debt particularly complex.

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March 9, 2015 in Scholarship, Tax | Permalink | Comments (1)

The IRS Scandal, Day 669

IRS Logo 2Forbes, Lois Lerner Out From Under Freedom Path Lawsuit For Now, by Peter J. Reilly:

Lois Lerner might have had a bit of a breathing spell for a couple of days before the announcements about more e-mails being found.  It was so short that it has largely been missed, but since I am playing catch-up I noticed it.  Lerner’s brief reprieve was the work of Judge Sidney Fitzwater, a Reagan appointee, of the District Court for the Northern District of Texas.  Judge Fitzwater’s decision in Freedom Path Inc v Lois Lerner et al at least gets Lois Lerner out from under one lawsuit. Freedom Path was suing Lois Lerner, unnamed officials of the IRS, the IRS and the United States.  The suit was about targeting FP due to its conservative views as it was applying for exempt status, illegally releasing information about FP and the general use of a “facts and circumstances” test in the IRS evaluation of political activities. Freedom Path complained in its lawsuit about the slow pace of its application and additional intrusive questions.  Also a copy of its application (Form 1024) was released to ProPublica.  On the application FP had indicated that it would not be engaging in political activity.  ProPublica released a story Controversial Dark Money Group Among Five That Told IRS They Would Stay Out of Politics, Then Didn’t that mentioned Freedom Path as one of the five. In April 2013 Freedom Path was asked for further information, which it was hesitant to release because of the disclosure to ProPublica.  The IRS then offered FP the opportunity to enter into a new expedited process, but that did not work for them.

Under this process, Freedom Path could obtain approval of its pending application if it made certain representations regarding the organization’s past, current, and future spending on political activities. Freedom Path alleges that it declined to participate in this optional expedited process because it viewed the required representations as unconstitutionally broad and as an IRS attempt to force Freedom Path to relinquish some of its First Amendment rights.

Lois Lerner Not A Texan The reason that Lois Lerner was dismissed from the suit is one that her supporters, if there are any, might not find very satisfying.  Her detractors, who are legion, will probably find it infuriating.  She was dismissed, because she does not have enough connection with Texas which is where the suit was brought (although in a federal court).

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March 9, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

TaxProf Blog Weekend Roundup

Sunday, March 8, 2015

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 #4 and #5:

  1. [320 Downloads]  Why Corporate Tax Reform Can Happen, by Edward Kleinbard (USC)
  2. [201 Downloads]  David Foster Wallace on Tax Policy, How to Be an Adult, and Other Mysteries of the Universe, by Arthur J. Cockfield (Queen's University)
  3. [173 Downloads]  Fiscally Transparent Entities: Eligibility for Tax Treaty Benefits, by Sumeet Khurana & Ashish Karundia
  4. [151 Downloads]  The Distributive Deficit in Law and Economics, by Lee Fennell (University of Chicago) & Richard McAdams (University of Chicago)
  5. [141 Downloads]  Inevitable: Sports Gambling, State Regulation, and the Pursuit of Revenue, by Anastasios Kaburakis (St. Louis), Ryan Rodenberg (Florida State) & John Holden (Florida State)

March 8, 2015 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

The IRS Scandal, Day 668

IRS Logo 2Midland Daily News editorial,  IRS Scandal Continues to Grow:

So, why is there so little interest in the IRS scandal?

This story has been gathering steam in terms of facts being revealed, but so far the major news outlets are showing little, if no interest, in covering the details.

Here’s what’s happened just recently:

  • One high-ranking government official said that there is “potential criminal activity” involved in the disappearance and hiding of emails belonging to IRS officials involved in the targeting of conservatives between 2010 and 2012.
  • Despite IRS Commissioner John Koskinen repeatedly saying under oath in previous Congressional hearings that Lois Lerner’s emails could not be recovered, investigators have been successful in recovering nearly 33,000 emails relevant to the IRS investigation. ...

Long-time political columnist George Will said on a talk show in February that the IRS scandal is as big as Watergate or the Iran-Contra scandal. He then asked, “so where’s the media?”

We are wondering the same thing. Getting to the truth — and holding our government officials accountable for their words and actions — should be a top priority for the press and for all Americans.

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March 8, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, March 7, 2015

Former IRS Commissioner Mark Everson Enters the 2016 Presidential Race

Everson for President

Former IRS Commissioner (2003-2007) Mark Everson has announced in this Letter to America that he is running for President:

Mr. Everson will have to overcome a tawdry sex scandal that resulted in his firing from his position as President and CEO of the American Red Cross:

Press and blogosphere coverage of Mr. Everson's nascent presidential campaign:

(Hat Tip: Evelyn Brody.)

March 7, 2015 in IRS News, Tax | Permalink | Comments (5)

How Men Can Succeed in the Boardroom and the Bedroom: Choreplay

ChoreplayNew York Times:  How Men Can Succeed in the Boardroom and the Bedroom, by Sheryl Sandberg (Facebook) & Adam Grant (Wharton):

It's easy to see how women benefit from equality — more leadership positions, better pay at work and more support at home. Men may fear that as women do better, they will do worse. But the surprising truth is that equality is good for men, too.

If men want to make their work teams successful, one of the best steps they can take is to bring on more women. ...

In a previous article, we highlighted why men ought to share the “office housework” — taking notes, planning meetings and helping others. Doing more actual housework matters, too. Research shows that when men do their share of chores, their partners are happier and less depressed, conflicts are fewer, and divorce rates are lower. They live longer, too; studies demonstrate that there’s a longevity boost for men (and women) who provide care and emotional support to their partners later in life.

If that isn’t exciting enough, try this: Couples who share chores equally have more sex. As the researchers Constance T. Gager and Scott T. Yabiku put it, men and women who work hard play hard. One of us, Sheryl, has advised men that if they want to do something nice for their partners, instead of buying flowers, they should do laundry. A man who heard this was asked by his wife one night to do a load of laundry. He picked up the basket and asked hopefully, “Is this Lean In laundry?” Choreplay is real.

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March 7, 2015 in Legal Education, Tax | Permalink | Comments (3)

The IRS Scandal, Day 667

IRS Logo 2Forbes, Finally, Suing IRS Over All Those Emails, by Robert W. Wood:

Whatever your political views, it is worth reading the press release by Judicial Watch about its latest lawsuit against the IRS. You have to be a kind of Energizer Bunny to keep after the dog-ate-my-homework targeting scandal. Like President Obama, some insist there was not a smidgen of corruption at the IRS. Others aren’t so sure.

The latest Freedom of Information Act lawsuit seeks “any and all records related to the destruction of damaged hard drives from IRS employee computers from January 1, 2010, to the present.” The suit was filed in federal court, Judicial Watch v. Internal Revenue Service. Interestingly, the lawsuit was filed even before the latest Hearings of the Committee on Oversight & Government Reform. On February 26, 2015, the Treasury Inspector General said he is investigating possible criminal activity at the IRS. The most disturbing revelation was that the IRS had not even asked for the backup tapes when the ‘hard drive crash’ excuse was first used. If true, that sounds like a game-changer.

After all, IRS Commissioner John Koskinen testified that recovery efforts had been thorough, and the tapes and emails couldn’t be found. Remember all the millions and millions in taxpayer money spent looking? One report said over 250 IRS employees spend 100,000 hours, costing taxpayers at least $14 million. Mr. Koskinen has been characterized as a political fixer who, unlike most IRS Commissioners, has not had a career in the tax industry.

He may want to explain all the multi-million dollar recovery efforts, particularly if somehow they did not include some simple questions! In the meantime, the IRS statements in briefs in the Judicial Watch case showcase what is hard to see as anything but obstruction. The IRS has said repeatedly that “records that pertain to the destruction of damaged hard drives are not maintained in a searchable manner.” The IRS has denied multiple requests, leading to multiple suits. ...

IRS attorneys said the back-up system would be too onerous to search. Yet in recent testimony, the Treasury Inspector General for Tax Administration said IRS tech employees told them that IRS management never asked for the tapes.

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March 7, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, March 6, 2015

Kysar Presents Interpreting Tax Treaties Today at Virginia

KysarRebecca Kysar (Brooklyn) presents Interpreting Tax Treaties at Virginia today as part of its Faculty Workshop Series:

The circumstances, if any, that permit a non-uniform, or differentiated, approach to treaty interpretation are difficult to define. Generally, a differentiated approach stands in tension with the Vienna Convention’s rules of interpretation, which apply to all treaties. Yet the notion that some treaties warrant special interpretive rules is also widely accepted by courts, states, and scholars. Thus far, however, efforts to justify differentiated treaty interpretation based on subject matter or treaty purpose have proven inadequate. A more promising avenue is the examination of the objective characteristics shared within a treaty type. One such characteristic, I contend, is the treaty’s degree of completeness. Specifically, all else being equal, standalone instruments call for less reliance upon extrinsic materials; interstitial instruments demand more.

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March 6, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Weekly Tax Roundup

Weekly SSRN Tax Roundup

Weekly Student Tax Note Roundup

The IRS Scandal, Day 666

IRS Logo 2The Fiscal Times, Hillary Clinton Is the Republicans’ Newer, Bigger Lois Lerner:

Clinton has morphed into a hybrid of everything Republicans deplore about the Clintons, reminiscent of the conduct of IRS official Lois Lerner.

Many in the conservative movement smelled an administration plot to suppress Republican activists during the 2012 presidential election, and when Lerner famously refused to testify before Congress, she only cemented that perception. But the real reason conservatives have never let go of Lerner is her emails. The IRS claimed that Lerner and six other employees’ official IRS computers suffered hard drive crashes that rendered much of the information on it unrecoverable. It was impossible, therefore, for the IRS to credibly claim that it had turned over all relevant emails involving Lerner to Congressional committees investigating the targeting of non-profit groups. In fact, Lerner emails are still being uncovered.

A similar search for Clinton’s emails was launched Wednesday, when Rep. Trey Gowdy (R-SC), the chairman of the House Select Committee that is investigating the attack on the U.S. diplomatic compound in Benghazi, Libya in September 2012, announced that his committee would subpoena Clinton’s emails. ...

Clinton’s situation is arguably worse that Lerner’s because the wound is completely self-inflicted. At the time Lerner’s computer failed, the agency claimed that the back-up system they did have only kept data for 6 months before overwriting the digital tapes. IRS workers, including Lerner, were expected to identify all the emails they sent or received that could be classified as a “federal record” and to print out hard copies.

In fact, the records were backed up, and investigators were able to recover more than 30,000 emails as well as tapes from servers within two weeks dating back to 2001. As a result, the possibility of criminal activity is being probed by the Treasury Inspector General for Tax Administration.

Nevertheless, the procedure in place at the IRS left open the possibility that an employee guilty of wrongdoing might simply decline to save incriminating emails in hard copy. Taking things a step further – as many conspiracy-minded commentators did – one can imagine a staged hard drive “crash” that permanently eliminates evidence.

There is no evidence to suggest that Lerner was derelict in observing the rules on record retention, and certainly none to suggest that she engineered a fake hard drive crash. But you can’t prove a negative, and the system in place at IRS, making Lerner the arbiter of what was and was not a federal record, left ample room for doubt that there had been a cover up.

While the conditions that created doubt about Lerner’s emails were largely the fault of the IRS’s internal systems, Hillary Clinton has no such defense. She could have used the official email system, which archives messages. Her successor, John Kerry, does just that. But she didn’t.

Putting aside the apparent risk of placing all of her official communications outside the protection of the secure State Department email system (a major issue according to this Bloomberg report), the decision effectively put Clinton in the same position that IRS rules created for Lerner. It made her the arbiter of what emails were and were not considered public records.

  • The American Spectator, If David Petraeus Were Hillary Clinton:  "Think Lois Lerner with a server in her basement and what would have happened if Lerner and Lerner alone had 100% control on who saw her e-mails and which would or would not be erased as investigators closed in."
  • Town Hall, White House Squirms Over Hillary's Email Scandal, Forgets Embrace of Regular Law Breaking:  "Former head of tax exempt groups at the IRS Lois Lerner, who was a key player in targeting conservatives between 2010 and 2012, used a personal email account to conduct official government business. "Through the course of the investigation, we have learned that you sent documents related to your official dendrites from your official IRS e-mail account to an msn.com e-mail account labeled 'Lois Home.' This raises some serious questions concerning your use of a non-official e-mail account to conduct official business. Accordingly, we write to request documents related to your official duties that are housed in non-official e-mail accounts," former Chairman of the House Oversight Committee Darrell Issa and former Subcommittee Chairman Jim Jordan sent in a letter to Lerner last year. "The use of non-official e-mail accounts to conduct official business implicates federal records requirements. Use of a non-official e-mail account to conduct government business raises the prospect that records -- as defined by the Federal Records Act -- are not captured by official government e-mail archiving systems. It also creates difficulties in fulfilling the IRS' obligations under the Freedom of Information Act and other litigation requests. You use of non-official e-mail account also frustrates congressional oversight obligations." Are we really surprised she plead the fifth?"

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March 6, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Thursday, March 5, 2015

Prasad Presents Starving the Beast: The 1981 Reagan Tax Cut Today at UCLA

PrasadMonica Prasad (Northwestern) presents Starving the Beast: The 1981 Reagan Tax Cut at UCLA today as part of its Colloquium on Tax Policy and Public Finance hosted by Jason Oh and Alexander Wu:

The debt when Reagan entered office was just over $900 billion, not historically high in constant dollars or as a percent of GDP, but by the time Reagan left office it had almost tripled in nominal terms, and in percent of GDP it had gone from 33.4 percent to 51.9 percent. At the end of his term, the debt stood at $2.6 trillion, with a substantial portion of it contributed by Reagan's own policies: a mountain over 160 miles high in loose or tight bricks.

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March 5, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (4)

Kysar Presents Interpreting Tax Treaties at Harvard

KysarRebecca Kysar (Brooklyn) presented Interpreting Tax Treaties at Harvard yesterday as part of its Tax Law, Policy and Practice Workshop Series hosted by Daniel Halperin and Stephen Shay:

The circumstances, if any, that permit a non-uniform, or differentiated, approach to treaty interpretation are difficult to define. Generally, a differentiated approach stands in tension with the Vienna Convention’s rules of interpretation, which apply to all treaties. Yet the notion that some treaties warrant special interpretive rules is also widely accepted by courts, states, and scholars. Thus far, however, efforts to justify differentiated treaty interpretation based on subject matter or treaty purpose have proven inadequate. A more promising avenue is the examination of the objective characteristics shared within a treaty type. One such characteristic, I contend, is the treaty’s degree of completeness. Specifically, all else being equal, standalone instruments call for less reliance upon extrinsic materials; interstitial instruments demand more.

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March 5, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Hickman Presents Treasury's Retroactivity Today at Iowa

Hickman 2014 2Kristin Hickman (Minnesota) presents Treasury's Retroactivity at Iowa today as part of its Faculty Workshop Series:

In Bowen v. Georgetown University Hospital, the Supreme Court described retroactivity as "not favored in the law" and generally rejected allowing federal administrative agencies to adopt regulations "altering the past legal consequences of past actions."  Unlike most regulatory agencies, Treasury and the IRS are expressly authorized by Congress to adopt regulations with precisely such primary retroactive effect.  Specifically, IRC § 7805(b) grants Treasury and the IRS the power to backdate tax regulations under a variety of circumstances.  Preliminary analysis shows that Treasury and the IRS utilize this authority regularly with little judicial oversight for abuse of discretion.  Using empirical data, this article will explore more fully Treasury and IRS utilization of the authority to adopt retroactively effective regulations interpreting the Internal Revenue Code.

March 5, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

WSJ: Is It Fair to Tax Capital Gains at Lower Rates Than Earned Income?

Wall Street Journal, Is It Fair to Tax Capital Gains at Lower Rates Than Earned Income?:

Capital gains—and how big a bite the government should take out of them—have become a major point of contention in the past couple of months.

In January, President Obama proposed tax changes designed to raise some $320 billion over 10 years, largely through higher levies on high-income Americans. The revenue would be used to cover $235 billion in tax breaks, mostly for moderate-income workers, along with other initiatives.

Among the changes he proposed: boosting the capital-gains rate to 28% for the top 1% of taxpayers, up from the current 23.8%, as well as a new capital-gains tax on many inheritances.

The GOP fired back that taxing investment income would harm economic growth by discouraging business investment and thereby hurt workers’ incomes.

All of which points to a broader question that divides experts: Are capital gains so different from earned income that they should be taxed at a different rate?

Below, two experts tackle that question.

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March 5, 2015 in Tax | Permalink | Comments (2)

Georgetown Lateral Hires: Lilian Faulhaber (From BU), Brian Galle (From BC)

Georgetown Law School, Tax Scholars Join Georgetown Law Faculty:

Georgetown University Law Center is pleased to announce that tax scholars Lilian V. Faulhaber and Brian Galle will be joining the Law Center faculty next year. ...

Faulhaber (2016)Faulhaber joins Georgetown Law from Boston University School of Law. Since 2013, she has worked at the Organisation for Economic Co-operation and Development, where she is an adviser to the Base Erosion and Profit Shifting Project. Before joining the Boston University faculty, she was a Climenko Fellow and Lecturer on Law at Harvard Law School. Her research and teaching interests include international tax law, federal income tax law, tax policy, European Union law and international law.  She clerked for Senior Judge Robert E. Keeton and Judge William G. Young, both on the U.S. District Court for the District of Massachusetts, and was an associate at Cleary Gottlieb Steen & Hamilton LLP in New York. A graduate of Harvard College, she received an M.Phil. from Cambridge University and a J.D. from Harvard Law School, where she was editor-in-chief of the Harvard International Law Journal

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March 5, 2015 in Legal Education, Tax, Tax Prof Moves | Permalink | Comments (1)

Mankiw: Dynamic Scoring in Congress Is Defensible but Slippery

New York Times:  Dynamic Scoring in Congress Is Defensible but Slippery, by N. Gregory Mankiw (Harvard):

Until now, conventional budget analysis has used a process called static scoring, which assumes that the path of gross domestic product remains the same when the government changes taxes or spending. This procedure has the virtues of simplicity and transparency.

Yet the assumption of unchanged G.D.P. also has one notable drawback: It is patently false. Much economic theory and empirical research confirm that fiscal policy influences the course of the economy.

Indeed, having an economic impact is a big part of why policy makers use the tools at their disposal, whether it is the tax cuts of Ronald Reagan and George W. Bush or the stimulus package of Mr. Obama. It seems somehow churlish for Congress’s economists to assume that a policy change won’t accomplish its goal simply to make their jobs easier. ...

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March 5, 2015 in Tax | Permalink | Comments (0)

The IRS Scandal, Day 665

IRS Logo 2Letter From Orrin G. Hatch (Chair, Senate Finance Committee) & Paul Ryan (Chair, House Ways & Means Committee) to John Koskinen (Commissioner, IRS) (Mar. 4, 2015):

As Chairmen of the Senate Committee on Finance and House Committee on Ways and Means, we have the obligation to conduct oversight of the administration of the Internal Revenue Code. This includes compliance with IRC §6103, which establishes rules governing the use of confidential tax return information and governs the manners in which it may be disclosed. As you know, §6103(g) provides the President of the United States and certain White House officials access to this information in limited circumstances and with certain required procedures. In carrying out our oversight obligations, we are seeking to determine the degree to and manner in which the Internal Revenue Service shares taxpayer information with the Executive Office of the President.

You will recall that former Ways and Means Chairman Dave Camp requested that the IRS provide all communication between the IRS and Executive Office of the President on April 30, 2014. You responded that your agency would be unable to provide the requested communication because of limited resources. In light of your response, our committees sought these records from the White House in two separate letters earlier this year. On February 17, White House officials responded to our requests, refusing to provide the documents and redirecting the request to the Internal Revenue Service. In light of the White House Counsel’s refusal to comply with our request, we ask that you provide the documents – originally requested in April of last year – without delay. This production will include all electronic communication in the agency’s possession from or to an “eop.gov” email address, or regarding White House communication, from January 1, 2010 through the date of this letter.

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March 5, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, March 4, 2015

Blouin Presents The Role of 'Check-the-Box' on Multinational Tax Planning Today at Penn

Blouin (2015)Jennifer Blouin (Pennsylvania) presents Does Organizational Form Affect Firms' Foreign Operations? The Role of 'Check-the-Box' on Multinational Tax Planning at Pennsylvania today as part of its Tax Law and Policy Workshop Series hosted by Chris William Sanchirico and Reed Shuldiner:

This study investigates the effect of the 1997 check-the-box tax legislation on the current effective income tax rates of U.S. multinational firms. Following the empirical methodology developed in Dyreng and Lindsey (2009), we measure the effect that the change in legislation has on the average worldwide, U.S., and foreign taxes paid on worldwide, federal and foreign pretax book income for a large sample of U.S. multinational firms. We find that on average U.S. multinational firms’ worldwide tax rates declined by 4.3% in the post-1996 period. Further, we find that the effect of the legislation was greater on U.S. multinational firms’ average foreign tax rates as compared to their average U.S. foreign tax rates. Our results also suggest that the effect is concentrated in the U.S. multinational firms that had a greater change in their ownership structures and a greater change in the balance of their intercompany payments in the post-1996 period. Although our results do suggest that the 1997 legislation served to reduce U.S. tax collections, our results imply that the 1997 legislation had a greater effect on firms’ foreign tax burdens.

March 4, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

U.S. Companies Are Stashing $2.1 Trillion Overseas to Avoid Taxes

Bloomberg, U.S. Companies Are Stashing $2.1 Trillion Overseas to Avoid Taxes:

Eight of the biggest U.S. technology companies added a combined $69 billion to their stockpiled offshore profits over the past year, even as some corporations in other industries felt pressure to bring cash back home.

Microsoft, Apple, Google and five other tech firms now account for more than a fifth of the $2.10 trillion in profits that U.S. companies are holding overseas, according to a Bloomberg News review of the securities filings of 304 corporations. The total amount held outside the U.S. by the companies was up 8 percent from the previous year, though 58 companies reported smaller stockpiles.

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March 4, 2015 in Tax | Permalink | Comments (1)

Kleinbard: A Lower Corporate Tax Rate Would Overcome Resistance to Tax Reform by Encouraging Incorporation of Pass-Through Entities

Bloomberg View:  Take the Odds on Corporate Tax Reform, by Edward D. Kleinbard (USC):

The smart money always wagers against tax reform, but 2015 may be the year that the sucker bet pays off, at least for business taxes. The driver could be the outdated corporate tax system:  The current 35 percent rate is out of step with world norms and holds back investment in the U.S. 

There is general agreement that the corporate tax rate should be in the mid-20s. There is also near-consensus that most tax incentives and subsidies should be thrown out to free up the revenue needed for lower rates. 

Two big hurdles remain. The more intractable one involves so-called pass-through entities. These firms -- sole proprietorships, partnerships, limited liability companies and S corporations -- are often conflated with small businesses and entrepreneurs, even though many of them are well-heeled hedge funds, law firms and private-equity shops. 

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March 4, 2015 in Tax | Permalink | Comments (2)

Clausing: Beyond Territorial and Worldwide Systems of International Taxation

Kimberly A. Clausing (Reed College), Beyond Territorial and Worldwide Systems of International Taxation:

The dialogue regarding the international taxation of multinational firms should move beyond the rhetoric of comparing supposedly territorial and worldwide systems of taxation. Among major countries, there are no pure territorial or pure worldwide systems, just systems that lie on a spectrum between these extremes. Once one recognizes the characteristics that determine where on the spectrum particular countries lie, it is far from clear that purportedly worldwide countries are further to the “pure worldwide” end of the spectrum than are many purportedly territorial countries. Still, along the spectrum, tradeoffs between “competitiveness” and efficient capital allocation (with attendant effects on the home country tax base) are inevitable. Thus, I describe international tax system design proposals that might transcend this tradeoff, examining several such options. Finally, I discuss the current efforts of the BEPS process.

March 4, 2015 in Scholarship, Tax | Permalink | Comments (0)

Merrill Lynch Hires Tax Expert Lewis Steinberg From Credit Suisse

SteinbergNew York Times Deal Book, Merrill Lynch Hires Tax Expert From Credit Suisse:

Bank of America Merrill Lynch has hired Lewis Steinberg, a senior banker from Credit Suisse, to serve as its in-house tax expert, the firm announced in an internal memorandum on Monday.

He will join in May as head of structured solutions for the American operations of the mergers business and will report to the co-heads of the unit, Patrick Ramsey and Jack MacDonald, according to the memo, which was reviewed by DealBook.

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March 4, 2015 in Tax | Permalink | Comments (1)

Death of Jerome Kurtz, Former IRS Commissioner

New York Times, Jerome Kurtz, 83, Dies; Headed I.R.S. in Carter Administration:

Jerome Kurtz, who as commissioner of the Internal Revenue Service during the Carter administration was known for cracking down on tax shelters and other tax advantages for the wealthy, died on Friday in Manhattan. He was 83. The cause was complications of surgery, his family said. ...

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March 4, 2015 in Obituaries, Tax | Permalink | Comments (0)

Senate Report Blames Tax Pros for Unfair Tax Code

Senate LogoFollowing up on yesterday's post, Senate Holds Hearing Today on Fairness in Taxation:  Democratic Staff, Senate Finance Committee, How Tax Pros Make the Code Less Fair and Efficient: Several New Strategies and Solutions:

Have you ever heard of a collar? Or a basket option? Or a wash sale? Most people haven’t. But many taxpayers use these sophisticated transactions to cut the taxes they could owe in half, often paying effective rates far lower than people who earn a regular paycheck.

This report describes each of these little known tax avoidance strategies identified for Senator Wyden by the nonpartisan staff of the Joint Committee on Taxation (JCT) and outside independent experts, relying on memoranda, examples, and descriptions. A preliminary analysis indicates that reforms to rein in some of these strategies could reduce the amount of taxes avoided by tens of billions of dollars over the next decade while making the tax code fairer and simpler overall.

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March 4, 2015 in Congressional News, Tax | Permalink | Comments (2)

The IRS Scandal, Day 664

IRS Logo 2George Will, Stopping the IRS:

Rep. Peter Roskam is now chairman of the Ways and Means subcommittee whose jurisdiction includes oversight of the Internal Revenue Service, and hence of Lois Lerner's legacy. He knows how interesting her career was before she, as head of the IRS exempt-organizations division, directed the suppression of conservative advocacy groups by delaying and denying them the tax exempt status that was swiftly given to comparable liberal groups.

In 2013, Roskam, in a televised committee hearing, told the story of Al Salvi, who in 1996 was the Republican's Senate candidate against then congressman, now senator, Dick Durbin. Democrats filed charges with the Federal Election Commission against Salvi's campaign, charges that threatened to dominate the campaign's final weeks. Salvi telephoned the head of the FEC's Enforcement Division, who he says told him: "Promise me you will never run for office again, and we'll drop this case." So said Lois Lerner. After Salvi lost, FBI agents visited his elderly mother, demanding to know, concerning her $2,000 contribution to her son's campaign, where she got "that kind of money." When a federal court held that the charges against Salvi were spurious, the FEC's losing lawyer was Lois Lerner.

Roskam's telling of Salvi's story elicited no denial from Lerner. Neither did the retelling of it in this column (June 13, 2013). No wonder: The story had not been deemed newsworthy by the three broadcast networks' evening news programs, by The New York Times or The Washington Post. With most of the media uninterested in the use of government institutions to handicap conservatives, stonewalling would work.

It still is working through dilatory and incomplete responses to subpoenas, and unresponsive answers to congressional questions. Lerner's name now has an indelible Nixonian stain, but there probably will be no prosecution. If the administration's stonewalling continues as the statute of limitations' clock ticks, Roskam says, "She will get away with it."

Now in his fifth House term, Roskam, 53, says, "The advantage in this town is always with the entity that doesn't want to do anything." Many thousands of Lerner's emails that supposedly were irretrievably lost have been found, but not released. The Justice Department's investigation, which was entrusted to a political appointee who was a generous contributor to Barack Obama's campaign, is a stone in the stone wall.

Roskam says the task now is "to see that Lois Lerner 2.0 is impossible." One place to begin is with the evidence -- anecdotal but, in the context of proven IRS corruption, convincing -- of other possibly punitive IRS behavior toward Republican contributors and other conservative activists. This justifies examining the IRS' audit selection process. This would produce interesting hearings for most of the media to ignore.

Next, there should be hearings into the illegal disclosure of taxpayer information about conservative individuals and groups to the media and to liberal officials and groups. Cleta Mitchell, a lawyer for some groups abused by the IRS (and for this columnist on different matters), also suggests prohibiting IRS employees from joining a union.

The National Treasury Employees Union,” she says, “provides no protection to IRS employees that federal statutes and the civil service system do not already provide. It already takes an act of God to hold an IRS employee accountable for his or her actions. But it is worse than merely redundant for IRS employees to belong to the NTEU. Because it adds nothing to its members’ protections, it is a purely political organization. In 2014, fully 95 percent of its contributions went to Democrats, including 11 Democratic members of the House Committee on Oversight and Government Reform. So, the IRS employees’ union dues finance the election of people who are supposed to scrutinize IRS’ behavior.

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March 4, 2015 in About This Blog, IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, March 3, 2015

Mason Presents Citizenship Taxation Today at NYU

Mason (2015)Ruth Mason (Virginia) presents Citizenship Taxation at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Alan Viard:

The United States is the only country that taxes its citizens’ worldwide income, even when those citizens live indefinitely abroad. This Article critically evaluates the traditional equity, efficiency, and administrability arguments for taxing nonresident citizens. It also raises new arguments against citizenship taxation, including that it puts the United States at a disadvantage when competing with other countries for highly skilled migrants.

March 3, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Weinzierl Presents Revisiting the Classical View of Benefit-Based Taxation Today at Georgetown

Weinzierl (2016)Matthew Weinzierl (Harvard Business School) presents Revisiting the Classical View of Benefit-Based Taxation at Georgetown today as part of its Tax Law and Public Finance Workshop Series hosted by John BrooksItai Grinberg, and David Schizer:

This paper explores how the persistently popular "classical" logic of benefit-based taxation, in which an individual's benefit from public goods is tied to his or her income-earning ability, can be incorporated into modern optimal tax theory. If Lindahl's methods are applied to that view of benefits, first-best optimal policy can be characterized analytically as depending on a few potentially estimable statistics, in particular the coefficient of complementarity between public goods and innate talent. Constrained optimal policy with a Pareto-efficient objective that strikes a balance–controlled by a single parameter– between this principle and the familiar utilitarian criterion can be simulated using conventional constraints and methods. A wide range of optimal policy outcomes can result, including those that match well several features of existing policies. To the extent that such an objective reflects the mixed normative reasoning behind prevailing policies, this model may offer a useful approach to a positive optimal tax theory.

March 3, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

WaPo: The Role of Tax Lawyers, Tax Profs, and the Tax Press in the Fate of ObamaCare at the Supreme Court

ObamaCareWashington Post, Six Words Might Decide the Fate of Obamacare at the Supreme Court:

When the Supreme Court takes up the latest challenge to President Obama’s health-care law this week, how the justices interpret a six-word phrase in the bill could determine its fate.

The law, adopted in 2010, says the federal government can pay subsidies to help people afford insurance bought through “an Exchange established by the state.”

But two-thirds of the states have opted against setting up their own exchanges, and as a result, more Americans have been buying insurance through the federal insurance marketplace. Now, opponents of the law will make their case to the high court that Americans who are not using the state exchanges are ineligible for subsidies. And if they win, insurance premiums could skyrocket and many people might drop their coverage — possibly undermining the whole health-care program.

And as the justices weigh whether the health-care law in fact has a fatal glitch, one of the key questions is this: Why did the Obama administration rule-writing officials in the Internal Revenue Service and its parent agency, the Treasury Department, ultimately interpret the language the way they did?

It had never occurred to the Treasury Department official responsible for making the changes in the tax code required by the law that there was more than one way to read the phrase — until she happened across an article in a trade journal.

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March 3, 2015 in Tax | Permalink | Comments (6)

NY Times: Britain’s Elite Still Enjoying a Tax Break 100 Years Old

NY Times Dealbook (2013)New York Times Deal Book, Britain’s Elite Still Enjoying a Tax Break 100 Years Old:

They are among the British moneyed elite: the head of the nation’s largest bank, a billionaire hedge fund manager and the owner of some of London’s most luxurious nightclubs.

Yet for tax purposes, they are not entirely British.

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March 3, 2015 in Tax | Permalink | Comments (0)