TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Friday, July 28, 2017

The Tax App: Eliminating Tax Returns Entirely

David S. Miller (Proskauer), The Tax App: Eliminating Tax Returns Entirely:

Congress could very easily achieve return-free filing — without IRS involvement or any substantive changes to the tax code — by simply requiring all tax information providers (such as employers, banks, stock brokerage firms, and charities) to make the tax information they hold (e.g., IRS Forms W-2s, 1099s, 1098s, and charitable donation information) available electronically in a single accessible format so that a taxpayer could receive all of his or her tax information electronically.

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July 28, 2017 in Scholarship, Tax | Permalink | Comments (5)

NY Times: Wisconsin’s Lavish Lure For Foxconn — $3 Billion In Tax Subsidies

New York Times, Wisconsin’s Lavish Lure for Foxconn: $3 Billion in Tax Subsidies:

Foxconn’s plan for a $10 billion factory in Wisconsin is certainly good news for President Trump and Republican politicians Gov. Scott Walker and Speaker Paul D. Ryan, whose district the plant would call home.

But the deal with Foxconn, the Taiwanese electronics supplier, comes with a heavy price tag for Wisconsin taxpayers: $3 billion in state tax credits that dwarf the typical incentive package companies receive from local governments.

Even as Mr. Walker celebrated the news with Foxconn executives at a rally at the Milwaukee Art Museum on Thursday, experts on the political left and right alike said the rewards were not justified by the cost of the tax breaks.

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July 28, 2017 in Tax | Permalink | Comments (5)

Thursday, July 27, 2017

A Hamilton Birthday

The wonderful people at Pepperdine really "get" their new dean:  check out what greeted me in my office this morning:

Hamilton

For more on my obsession with interest in Hamilton, see here and:

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July 27, 2017 in Legal Education, Tax | Permalink | Comments (3)

Trump, Congress Reach Agreement On 'Skinny Tax Reform'

GOP Statement on Tax Reform:

Today, House Speaker Paul Ryan (R-WI), Senate Majority Leader Mitch McConnell (R-KY), Treasury Secretary Steven Mnuchin, National Economic Council Director Gary Cohn, Senate Finance Committee Chairman Orrin Hatch (R-UT), and House Ways and Means Committee Chairman Kevin Brady (R-TX) issued the following joint statement on tax reform:

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July 27, 2017 in Congressional News, Tax, Tax Policy in the Trump Administration | Permalink | Comments (3)

Reality Check: Is Trump Right That US Has Highest Taxes?

OECDBBC News, Reality Check: Is Trump Right That US Has Highest Taxes?:

The claim: The US has the highest taxes in the world.

Reality Check verdict: The total amount of tax raised by the United States as a proportion of the size of its economy is not the highest in the world. It also does not have the highest rates of taxes on households. By one measure, it does have the highest rate of corporation tax.

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July 27, 2017 in Tax | Permalink | Comments (4)

Crawford & Spivack: Human Rights And Taxation Of Menstrual Hygiene Products In An Unequal World

HRBridget J. Crawford (Pace) & Carla Spivack (Oklahoma City), Human Rights and Taxation of Menstrual Hygiene Products in an Unequal World, in Human Rights and Tax in an Unequal World (Philip G. Alston and Nikki Reisch eds., Oxford University Press 2018):

This book chapter, written in connection with the New York University School of Law Center for Human Rights and Global Justice Conference on Human Rights and Tax in an Unequal World, argues that taxation, gender, and human rights are all linked. The authors use the lens of the "tampon tax" — sales, VAT and similar taxes imposed on menstrual hygiene products — to explain the relationship between and among affordable menstrual hygiene products and the human rights to be free from discrimination, to sanitation, to education, to dignity, and to work. The chapter refers to examples from India and Kenya to illustrate the importance of access to both affordable menstrual hygiene products and private, hygienic sanitation facilities.

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July 27, 2017 in Book Club, Scholarship, Tax | Permalink | Comments (1)

Brexit Puts Financial-Trade Tax On Ice As Banks Start Moving

Bloomberg, Brexit Puts Financial-Trade Tax on Ice as Banks Start Moving:

A six-year push to impose a tax on financial transactions in Europe may have run its course, with Germany and France dragging their feet as they prepare for Brexit and a redrawing of the financial map that has already begun.

French Finance Minister Bruno Le Maire said earlier this month that Brexit could bring “thousands of jobs to Paris,” an opportunity that could be lost if the tax were imposed. His German counterpart, Wolfgang Schaeuble, said that “quite a bit speaks in favor of the French argument to look first at how the Brexit negotiations are going.”

With the heavyweight boosters among the 10 countries pursuing the tax getting cold feet, the plan’s future looks bleak....

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July 27, 2017 in Tax | Permalink | Comments (0)

Wednesday, July 26, 2017

Boni-Saenz: Distributive Justice And Donative Intent

Alexander A. Boni-Saenz (Chicago-Kent), Distributive Justice and Donative Intent, 65 UCLA L. Rev. ___ (2018):

The inheritance system is beset by formalism. Probate courts reject wills on technicalities and refuse to correct obvious drafting mistakes by testators. These doctrines lead to donative errors, or outcomes that are not in line with the decedent’s donative intent. While scholars and reformers have critiqued the intent-defeating effects of formalism in the past, none have examined the resulting distribution of donative errors and connected it to broader social and economic inequalities. Drawing on egalitarian theories of distributive justice, this Article develops a novel critique of formalism in the inheritance law context.

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July 26, 2017 in Scholarship, Tax | Permalink | Comments (0)

Columbia Journal Of Tax Law Publishes New Issue

NY Times: Canada Debates Whether Purchase Of Leibovitz Photos For $4.75m And Donation Valued At $20m To Art Gallery Is A Tax Dodge

Annie 2New York Times, Canada Debates Whether Gift of Leibovitz Photos Is Also a Tax Dodge:

Someone — and absolutely no one involved seems ready to say who — came up with an idea in 2012 for a patron to purchase 2,070 photos by the American portrait photographer Annie Leibovitz and then donate them to a museum in Canada.

This was a colossal score for the Art Gallery of Nova Scotia in Halifax, which owned nothing by Ms. Leibovitz at the time.

For Ms. Leibovitz, who had a financial crisis several years earlier, the transaction meant she earned several million dollars.

And the donor, a Deloitte Canada partner who said he had bought the collection to honor his mother’s memory, stood to qualify for a generous tax deduction and recognition as an arts patron.

Four years later, though, a Canadian government panel that must sign off on the deduction is still balking at approving it, partly because the panel won’t accept a $20 million valuation for a collection that the donor purchased for just $4.75 million.

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July 26, 2017 in Celebrity Tax Lore, Tax | Permalink | Comments (1)

'Captain Marvel' Will Receive A $20-Million Tax Credit To Shoot In California

MarvelLos Angeles Times, 'Captain Marvel' Will Receive a $20-Million Tax Credit to Shoot in California:

“Captain Marvel,” the upcoming superhero movie starring Brie Larson as the title character, will receive more than $20 million in tax credits to film in California, making it the first Marvel Comics movie to shoot primarily in-state since 2014’s “Captain America: The Winter Soldier.”

Eight studio and independent features were selected from 92 applications for the $68 million handed out in the latest round of tax incentives that are designed to attract more big-budget movie shoots to California. They include “Midway,” a World War II film directed by Roland Emmerich, and “Cheney,” a biopic of former Vice President Dick Cheney, starring Christian Bale....

“Captain Marvel” is expected to receive $20.8 million in credits. “Midway” has been allocated $13.9 million. “Bird Box,” a Netflix movie starring Sandra Bullock, will receive an estimated $2.5 million in credits....

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July 26, 2017 in Tax | Permalink | Comments (0)

Tuesday, July 25, 2017

Lawsky:  Formalizing The Tax Code

Sarah B. Lawsky (Northwestern), Formalizing the Code, 70 Tax L. Rev. 377 (2017):

The Internal Revenue Code is notoriously complex, both substantively and structurally. This article examines one source of structural complexity in the Internal Revenue Code: dependency among sections that stems from defined terms. In particular, the article examines what it terms the problem of “definitional scope”: when the structure of the Code leaves unclear to what a term refers. The article uses the problem of definitional scope as a case study to suggest that those who draft tax legislation should formalize proposed statutory language — translate it into logical terms — prior to its enactment.

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July 25, 2017 in Scholarship, Tax | Permalink | Comments (4)

Ring: The Tail, The Dog, And the Gig Worker (Commentary On The NEW GIG Act of 2017 Proposed Legislation)

Diane Ring (Surly Subgroup): The Tail, the Dog, and Gig Workers 

New legislation has just been introduced in the Senate that creates a “safe harbor” for independent contractor status. The proposed legislation provides that if a worker relationship satisfies certain criteria, then that worker can bypass the sometimes messy, multi-factor test for distinguishing between employees and independent contractors, and will be classified as an independent contractor for tax purposes. What prompted action now to address what has been a decades-old classification challenge for workers, businesses and the IRS alike? The gig economy. (Hence, the not-so-catchy title for the legislation: The New Economy Works to Guarantee Independence and Growth (NEW GIG) Act of 2017 (S. 1549)):

The legislation’s sponsor, Senate Finance Committee member John Thune, (R-S.D), described the impetus for the legislation as follows: “My legislation would provide clear rules so that these freelance style workers can work as independent contractors with the peace of mind that their tax status will be respected by the IRS.”

Is this really what gig workers are worrying about? . . .

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July 25, 2017 in Tax | Permalink | Comments (0)

WSJ: Mortgage Interest Tax Break Has ‘No Effect’ on Homeownership, Study Finds

Wall Street Journal, Mortgage Interest Tax Break Has ‘No Effect’ on Homeownership, Study Finds:

The mortgage interest deduction, a sacred cow in the U.S. tax code, does nothing to promote homeownership, according to an academic paper released Monday [Jonathan Gruber (MIT), Amalie Jensen (University of Copenhagen) & Henrik Kleven (Princeton), Do People Respond to the Mortgage Interest Deduction? Quasi-Experimental Evidence From Denmark], a finding that undermines one of the core justifications for the tax break.

Letting taxpayers deduct mortgage interest encourages them to buy bigger homes and more expensive homes — but it doesn’t change that fundamental decision about whether to buy in the first place.

“Over multiple time periods, and considering multiple empirical strategies, we find no effect of the tax policy change on whether households own or rent,” wrote the authors, Jonathan Gruber of the Massachusetts Institute of Technology, Henrik Kleven of Princeton University and Amalie Jensen of the University of Copenhagen.

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July 25, 2017 in Scholarship, Tax | Permalink | Comments (10)

Feldstein:  How To Make The Tax System Fairer And Save Social Security

Martin Feldstein (WSJ op-ed), How to Make the Tax System Fairer and Save Social Security:

The U.S. faces two major fiscal problems. Fortunately, there is a simple solution to both that also improves the fairness of the tax system.

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July 25, 2017 in Tax | Permalink | Comments (0)

Monday, July 24, 2017

New Sri Lanka Tax Bill Aims To Widen Tax Net, Cut Indirect Taxes

Reuters, New Sri Lanka Tax Bill Aims to Widen Tax Net, Cut Indirect Taxes:

Sri Lanka's new tax bill, demanded by the IMF as a condition for a third tranche of aid disbursed this week, will seek to ensure that all citizens pay direct taxes and cut indirect taxes, top finance ministry officials said on Friday.

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July 24, 2017 in News, Tax | Permalink | Comments (0)

C.S. Lewis & Lin-Manuel Miranda: How I Found My Faith In Mere Christianity And Deepened It In Hamilton

MCH2I repeatedly (perhaps excessively) extol the genius of Hamilton (see links below). I often tell people that the play changed my life and led me to seek the deanship of Pepperdine law school.  

Part of the explanation, of course, is the artistic majesty of the play. Like Michelle Obama, I think it is the best piece of art in any form that I have ever seen in my life. Like Oskar Eustis, I believe that Lin-Manuel Miranda is the William Shakespeare of our time. But Hamilton also transformed my life like nothing else has since I read C.S. Lewis's Mere Christianity twenty-one years ago. 

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July 24, 2017 in Legal Education, Tax | Permalink | Comments (1)

Yes, Killing The ACA’s Investment Tax Now Would Make The Next GOP Tax Bill Easier. Here's Why

Howard Gleckman (TaxVox Blog), Yes, Killing The ACA’s Investment Tax Now Would Make The Next GOP Tax Bill Easier. Here's Why:

The chaos surrounding Senate efforts to replace the Affordable Care Act will prolong the debate over what Republicans will do about the nearly $1 trillion in taxes the ACA will generate over the next 10 years. It is often said that the GOP wants to scrap those levies because it would make it easier for them to pass a future tax bill. But why?

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July 24, 2017 in Tax | Permalink | Comments (0)

TaxProf Blog Weekend Roundup

Sunday, July 23, 2017

Tribute To Erik Jensen

JensenTribute to Erik Jensen, 67 Case W. Res. L. Rev. 637-78 (2017):

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July 23, 2017 in Legal Education, Tax | Permalink | Comments (0)

The Top Five New Tax Papers

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

  1. [585 Downloads]  Family Limited Partnerships and Section 2036: Not Such a Good Fit, by Mitchell Gans (Hofstra) & Jonathan Blattmachr (Milbank, New York)
  2. [341 Downloads]  The Front Door Opens Wide for the Backdoor Roth IRA, by Philip Manns (Liberty) & Timothy Todd (Liberty)
  3. [297 Downloads]  The Rise and Fall of the Destination-Based Cash Flow Tax: What Was That All About?, by Daniel Shaviro (NYU)
  4. [207 Downloads]  The Case Against BEPS: Lessons for Coordination, by Mindy Herzfeld (Florida)
  5. [162 Downloads]  Targeting Corporate Inversions — Are We Doing the Right Thing?, by Doron Narotzki (Akron)

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

Saturday, July 22, 2017

This Week's Ten Most Popular TaxProf Blog Posts

Do Taxes Affect Marriage? Lessons From History

Edward G. Fox (NYU), Do Taxes Affect Marriage? Lessons from History:

This Article investigates the effect of taxes on marriage formation using a natural experiment generated by the income tax’s halting movement from individual taxation of married couples to joint taxation. The 1948 Revenue Act was the first to explicitly adopt joint taxation. Under the Act, married couples were taxed like two individuals, except each was assigned half of the couple’s joint income. This income splitting blunted the progressivity of the tax code, usually reducing the couple’s taxes. The 1948 Act, however, only affected common law states. Married couples in community property states in practice already enjoyed joint taxation with income splitting under Poe v. Seaborn (1930). The 1948 Act thus presents an unusually good opportunity to study the impact of taxes on marriage because it offers substantial exogenous state-by-state variation in tax incentives to marry.

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July 22, 2017 in Scholarship, Tax | Permalink | Comments (0)

Going Cashless? Bad for Tax Cheats, Privacy, Poor

Bloomberg, Going Cashless? Bad for Tax Cheats, Privacy, Poor:

Do we need cash? Humans have used all sorts of things to exchange items of economic value -- rare metals, strings of shells and even sunken boulders. Those objects have gotten more ephemeral, with paper money replacing most coins, and digital forms increasingly supplanting paper. Could physical cash go away entirely? Economists see great payoffs in a cashless society: lower transaction costs, new tools to manage economic growth and an end to tax evasion and money laundering. Critics see an end to privacy, frightening new powers for tyrants and costs that would fall disproportionately on the poor. The giant, if unintended, experiment that followed India’s attempt to withdraw 86 percent of cash in circulation showed one thing clearly: The end of cash is not likely to be a neat or simple process.

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July 22, 2017 in Tax | Permalink | Comments (2)

Friday, July 21, 2017

Weekly SSRN Tax Article Review And Roundup

This week, David Gamage (Indiana) reviews a new draft article by Regina Herzlinger (Harvard Business School) and Barak D. Richman (Duke Law), Evaluating Changes to the Income Tax Code to Create Consumer-Driven Health Insurance Competition.

Gamage (2017)The intersections between taxation and health policy have become increasingly important to political debates in Washington. A gorilla in the room for most of these discussions is the tax exclusion for employer provided health insurance. This exclusion has been widely criticized. Yet reformers have had little success in attempting to limit this exclusion.

In their new draft article, Herzlinger and Richman (hereinafter “HR”) model how reforming the exclusion for employer provided health insurance might affect employee pay and health care costs. HR argue for making changes to the tax laws surrounding the exclusion so that employees could choose to what extent they want to take advantage of the exclusion or instead receive increased take home pay (which would be taxable). HR estimate that giving workers this option would increase after-tax incomes by $46-48 billion annually, while reducing income inequality and “likely” controlling health care costs.

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July 21, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Tax Policy In The Trump Administration

IRC § 457A, Literal Income And Substitution Effects, And The Kübler-Ross Five Stages Of Taxes

Matt Levine (Bloomberg), Tax Bills and Libor Witnesses:

There is a widespread belief that taxes discourage economic activity. If you tax cigarettes, that will reduce smoking; if you tax labor income, that will reduce work; if you tax capital gains, that will reduce savings; if you tax estates, that will reduce death. This is standard Econ 101 reasoning, but that doesn't mean that it's universally valid. You can't rule out the possibility that someone, somewhere, will think "Higher taxes? That just means that I need to work more hours to pay them!" That someone is literally Steven A. Cohen:

Mr. Cohen, who ran SAC Capital before it pleaded guilty to criminal insider-trading charges in 2013, is nearing a launch of a new firm to manage as much as $20 billion, The Wall Street Journal earlier reported.

He has set that target, which would exceed the $16 billion managed at peak by SAC, partly because he wants to generate income to help pay the large tax bill, a person close to him said.

The "large tax bill" is the one that is coming due soon on offshore deferred compensation: Hedge fund managers used to be able to defer that income indefinitely, but Congress closed that loophole in 2008, and gave the managers until next year to pay taxes on previously deferred compensation....

Another widespread belief about taxes is that they encourage wasteful gamesmanship and structuring to avoid them. (That's how the offshore compensation came into being in the first place.) And that is still true. Here is a wonderful quote from a tax lawyer in his role as spiritual counselor:

“These are smart, aggressive people who don’t want to pay more than they have to and writing a huge check can be quite demoralizing," said Jonathan Brenner, a tax partner at Caplin & Drysdale. “Most recognize they’ve had a good run and now have to pay the piper, though not after first asking six different ways if there’s some silver bullet” to eliminate or reduce the taxes.

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July 21, 2017 in Tax | Permalink | Comments (3)

Thimmesch:  Online Shopping And Tax Privacy

Adam Thimmesch (Surly Subgroup): Online Shopping and Tax Privacy

The privacy implications of online commerce are complicated and fascinating. On the one hand, it allows individuals to protect their privacy by shopping for sensitive items without the knowing glances of store clerks, fellow patrons, or those passing by. On the other hand, it creates a digital trail that can connect them to a particular vendor or purchase in perpetuity. This can occur with respect to items that are politically, medically, or sexually sensitive and with respect to items that they’d just prefer to keep a secret. (For example, if you forget to browse in private mode, you might find that your wife’s Facebook feed now includes ads for the items that you were searching out for her birthday. Woops. Sorry dear.)

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July 21, 2017 in Tax | Permalink | Comments (0)

Thursday, July 20, 2017

Schizer:  Border Adjustments And The Conservation Of Tax Planning

David M. Schizer (Columbia), Border Adjustments and the Conservation of Tax Planning, 155 Tax Notes  1451 (June 5, 2017):

In this article, Schizer argues that U.S. corporate and shareholder taxes need to be reformed, and the corporate rate should be much lower. In reforming this dysfunctional regime, according to Schizer, Congress should keep both of these taxes as a form of built-in redundancy; if one tax is avoided, the other can still be collected.

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July 20, 2017 in Scholarship, Tax | Permalink | Comments (0)

10 Things To Know About Tax Practice

Above the Law: 10 Things to Know About Tax Practice:

Today’s topic: tax law.

1. What do you do in a typical day?

A typical day usually begins with reading daily tax publications. There are always many changes and developments to keep up with in tax law. It’s a challenge to stay on top of new regulations, IRS guidance, and other changes, but it also presents an opportunity for younger lawyers to know as much about a specific issue as more experienced lawyers.

Junior associates often spend a fair amount of time researching discrete issues. Although more senior lawyers spend less time on research, tax lawyers throughout their careers devote more of their time to research than lawyers in other practice areas. Despite the thousands of pages in the Internal Revenue Code and Treasury Regulations, there are still a lot of unanswered questions about how the tax rules apply to any given situation. Associates at large firms may also spend time reviewing tax disclosures in securities offerings, reviewing and negotiating the tax representations and other tax-related provisions in merger or other acquisition agreements, reviewing and negotiating the tax provisions in loan agreements, or drafting tax opinions.

As tax lawyers gain experience, they usually become more involved in tax structuring for joint ventures, acquisitions, dispositions, investment funds, or financial products, and provide more expert advice directly to clients on discrete tax issues. 

2. Who do you work with?

...

July 20, 2017 in Tax | Permalink | Comments (1)

Ventry:  Lawyers As Whistleblowers

Dennis J. Ventry, Jr. (UC-Davis), Stiches for Snitches: Lawyers as Whistleblowers, 50 U.C. Davis L. Rev. 1455 (2017):

This Article challenges the prevailing wisdom that ethics rules forbid lawyers from blowing the whistle on a client’s illegal conduct. While a lawyer is not free to disclose confidential information in every jurisdiction for every legal violation, the ethics rules in all jurisdictions permit disclosure of confidential information pertaining to a client’s illegal activities under certain conditions. Proving the lie of the prevailing wisdom, this Article examines a high profile case in the state of New York that ruled a lawyer whistleblower violated the state’s ethics rules by revealing confidential information to stop his employer-client from engaging in a tax fraud of epic proportions. The Article argues that the court undertook a deficient analysis of New York ethics rules pertaining to permissive disclosure of confidential client information. Even if the whistleblower had violated his ethical obligations, the New York False Claims Act (the statute under which he brought his action) expressly protects disclosure of confidential employer information made in furtherance of the statute. In addition to New York’s statutory shield, federal courts across the country have developed a public policy exception safeguarding whistleblowers for disclosing confidential information that detects and exposes an employer’s illegal conduct.

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July 20, 2017 in Scholarship, Tax | Permalink | Comments (0)

Wednesday, July 19, 2017

Liscow & Woolston:  How Income Taxes Should Change During Recessions

Zachary D. Liscow (Yale) & William A. Woolston (Stanford), How Income Taxes Should Change During Recessions, 70 Tax L. Rev. ___ (2017):

This paper offers recommendations for how the design of labor income taxes should change during recessions, based on a simple model of a recessionary economy in which jobs are rationed and some employees value working more than others do. The paper draws two counter-intuitive conclusions for maximizing social welfare.

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

Tax Court Denies Billionaire's $33m Charitable Deduction; Did University Of Michigan 'Rent Its Brand To Brazen 10:1 Tax Avoidance Scheme'?

Michigan LogoForbes, Billionaire Miami Dolphins Owner Gets Shut Out At Tax Court:

Billionaire Stephen Ross, owner of the Miami Dolphins, who thanks to a $200 million donation (largest in the history of the school) was described as Leader, Visionary, Philanthropist, Wolverine by the Universtiy of Michigan. ... Mr. Ross got his start in real estate based on his knowledge of federal tax garnered as a tax attorney for Coopers and Lybrand. ... I have to wonder whether the name of his flagship Related Companies is a tax geek joke.

Forbes, Billionaire Stephen Ross And The Ten For One Charitable Deduction:

The brazenness of the charitable plan with the University of Michigan designed to benefit Wolverine Billionaire Stephen Ross revealed in the Tax Court RERI Holdings I  decision is stunning.

The bare bones of the plan are that RERI, whose principal investor was Mr. Ross, bought an asset (call it "the thing") which it donated to the University of Michigan toward a $5 millon pledge that Mr. Ross had made.  Under the gift agreement UM had to hold onto "the thing" for two years, then sell it.  The amount that UM received would be credited to Mr. Ross's pledge. Round numbers RERI acquired "the thing" for $3 million.  When it came time to sell it UM had it appraised at $6 million.  UM sold it to a partnership for $2 million under pressure from Mr. Ross who threatened to count that amount towards his pledge, if they ended up getting less.  How large was the charitable deduction taken by RERI, of which Ross was the principal investor? That would be $33,019,000.

Mr. Ross is a prominent philanthropist.  It is tough to characterize this particular transaction as philanthropic as the claimed tax savings dwarf the amount out of pocket or the amount netted by the University of Michigan.  You have to wonder to what extent University development officers knew what was going on. Was University of Michigan seeking charitable donations or renting its brand to a tax avoidance scheme?

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July 19, 2017 in Celebrity Tax Lore, Legal Education, New Cases, Tax | Permalink | Comments (0)

Davis:  The Tax-Immigration Nexus

Tessa R. Davis (South Carolina), The Tax-Immigration Nexus, 94 Denv. L. Rev. 195 (2017):

Tax and immigration law have a shared interest in defining community. In order to implement a tax, we must know who belongs to the taxable community. At the same time, immigration law must define and administer the requirements for membership in the national community. Despite the differing objectives of tax and immigration law — raising revenue and deciding who may enter, remain, and become a citizen in the United States — each of these regimes uses a concept of citizenship to define their respective communities.

Starting from this common thread of the relevance of citizenship to both immigration and tax law, this Article draws upon social theory on citizenship to explore the many links between these seemingly disparate areas of law. Examination of these connections — what this Article calls the tax-immigration nexus — reveals that both areas of law draw upon the other to define citizenship. The interplay of tax and immigration citizenship yields important insights for tax law and policy.

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

Tuesday, July 18, 2017

Panama Papers Update: Pakistani Corruption Case Hinges On A Font (#FontGate)

CalibriBBC News: Pakistani Corruption Case Hinges on a Font

Doubt has been cast on a key document at the centre of a corruption inquiry in Pakistan because of the use of a particular typeface. And Twitter users are poking fun at Prime Minister Nawaz Sharif and his daughter Maryam Nawaz using the hashtag #FontGate.

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July 18, 2017 in Tax | Permalink | Comments (0)

Reforming U.S. Corporate Taxes

Veronique de Rugy (Mercatus Center), Reforming US Corporate Taxes:

The United States has fallen far behind other developed countries when it comes to corporate tax reform. In contrast to other developed nations, the United States has declined to reform the way it taxes corporations. Consequently, it now has the highest statutory corporate income tax rate of the G20 countries. The federal government needs to lower the corporate income tax rate-a reform that will improve the competitiveness of American businesses and encourage economic growth.

MC

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July 18, 2017 in Tax, Think Tank Reports | Permalink | Comments (9)

Monday, July 17, 2017

Brooks Reviews Christians' BEPS And The New International Tax Order

Jotwell (Tax) (2016)Kim Brooks (Schulich School of Law), What’s Up: BEPS and the New International Tax Order (JOTWELL) (reviewing Allison Christians (McGill), BEPS and the New International Tax Order, 2017 BYU L. Rev. ___ (2017):

It’s easy to underestimate the value of a good “what’s up” article. If you’ve been doing that, then you should take a look at BEPS and the New International Tax Order for a reminder of their value.

“What’s up” articles are the salve of the academy. They take a rapidly changing field of inquiry or policy space or legal doctrine and they encapsulate the state of play in a way that brings out and makes assessable the highlights.

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July 17, 2017 in Scholarship, Tax | Permalink | Comments (0)

Seattle Lawmakers Pass Tax On Highest Earners; Mayor Eager To Be Sued

TaxReuters: Seattle Lawmakers Pass Tax on Highest Earners; Mayor Eager to be Sued 

Seattle's city council unanimously passed a pioneering income tax on the city's highest earners on Monday, a measure that has become a clarion call for Democrats there even though it is likely to face a swift legal challenge over violating state law.

The measure created a 2.25 percent tax rate on individuals earning above $250,000 and married couples jointly earning above $500,000. The tax will add roughly $140 million in new annual revenue and affect fewer than 20,000 residents in the city of more than 660,000, supporters say.

The proposal has become a rallying cry for Democrats and activists in the liberal-leaning city who used local opposition to Republican President Donald Trump to advance long sought-after local policies.

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July 17, 2017 in Tax | Permalink | Comments (3)

TaxProf Blog Weekend Roundup

Sunday, July 16, 2017

Tax Court Denies Business Expense Deductions To Minister/Author Due To Lack Of Profit Motive

Tax Court (2017)Forbes, IRS Rejects Minister Tax Write-Offs For Lack Of Profit Motive:

The U.S. Tax Court has agreed with the IRS that a minister and author could not deduct business expenses. Why? He was not engaged in a trade or business for profit. To top it off, the reverend also wasn't allowed any deductions under the more liberal hobby loss rules, because he had no gross income from these activities. The case is Lewis v. Commissioner, involving a minister and author named Willie Lewis. He occasionally performed weddings, attended meetings, and conducted seminars. On his 2011 tax return, he claimed business expenses from these activities. The IRS said no, assessed more taxes, and added penalties. So Mr. Lewis went to Tax Court.

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July 16, 2017 in New Cases, Tax | Permalink | Comments (0)

The Top Five New Tax Papers

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

  1. [552 Downloads]  Family Limited Partnerships and Section 2036: Not Such a Good Fit, by Mitchell Gans (Hofstra) & Jonathan G. Blattmachr (Milbank, New York)
  2. [276 Downloads]  The Rise and Fall of the Destination-Based Cash Flow Tax: What Was That All About?, by Daniel Shaviro (NYU)
  3. [244 Downloads]  The Front Door Opens Wide for the Backdoor Roth IRA, by Philip Manns (Liberty) & Timothy Todd (Liberty)
  4. [191 Downloads]  The Case against BEPS: Lessons for Coordination, by Mindy Herzfeld (Florida)
  5. [138 Downloads]  Taxation, Competitiveness, and Inversions: A Response to Kleinbard, by Michael Knoll (Pennsylvania)

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

Saturday, July 15, 2017

This Week's Ten Most Popular TaxProf Blog Posts

Financial Times:  Ten Ways HMRC Can Tell If You’re A Tax Cheat

HMRCFinancial Times: Ten Ways HMRC Can Tell if You’re a Tax Cheat:

HMRC has come under intense pressure to show it can be tough on tax evasion. Here are 10 ways, some high-tech, some very traditional, that HMRC can use to check if you are cheating.

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July 15, 2017 in Tax | Permalink | Comments (0)

Tax Low To Get High: Governments Should Keep Weed Taxes Down

National Post op-ed:  Tax Low to Get High: Governments Should Keep Weed Taxes Down, by Arthur Cockfield (Queen’s University):

With the introduction of draft legislation to legalize marijuana by July 2018, the Liberal government is moving forward on its election promise. But as lawmakers polish the legislation to promote the best policy outcomes, they face a key challenge — they must ensure that any new tax measures encourage marijuana producers, distributors and sellers to become tax-compliant.

In terms of tax policy, Finance Minister Bill Morneau has wisely urged his provincial counterparts to keep taxes low on legal pot. As discussed in a report by the Office of the Parliamentary Budget Officer, if taxes are too high, then consumers will continue to use the black market. That’s a problem given more than 300 organized crime groups in Canada currently generate roughly $7 billion a year in illegal weed.

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July 15, 2017 in Tax | Permalink | Comments (1)

Friday, July 14, 2017

Weekly SSRN Tax Article Review And Roundup

This week, Ari Glogower (Ohio State) reviews a new work by Itai Grinberg (Georgetown), The New International Tax Diplomacy, 104 Geo. L.J. 1137 (2016).

Glogower (2016)Itai Grinberg’s fascinating and important new work addresses the thorny question of how best to coordinate and implement international tax norms.

International tax avoidance by multinationals has generated public attention across the globe, and ushered in a new era of cross-border coordination in the area of international tax law, most prominently through the OECD’s Base Erosion and Profit Shifting (BEPS) project.  Grinberg’s new work identifies, and evaluates, the BEPS project’s increasing reliance on the institutional and procedural frameworks used for coordinating international financial law, and considers the consequences of this approach for the overall success of the BEPS project.

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

Tax Policy In The Trump Administration

Tesla’s Sales Stall In Hong Kong As Tax Breaks End. Could The U.S. Be Next?

TeslaWashington Post: Tesla’s Sales Stall in Hong Kong as Tax Breaks End. Could the U.S. be Next? 

Tesla’s sales appear to be stalling in Hong Kong.

According to data from the city’s transportation department that was analyzed and first reported by the Wall Street Journal, not a single newly purchased Tesla model was registered in April after the government in March announced changes to the tax benefits customers can get from buying the electric cars. ...

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July 14, 2017 in Tax | Permalink | Comments (0)

Thursday, July 13, 2017

Ranking The States By Fiscal Condition

George Washington Seeks To Hire A Junior Tax Prof

George Washington Law Logo (2016)George Washington seeks to hire a Tax Prof with 0-2 years of experience.  For more information or to apply, email Faculty Appointments Committee Chair Catherine Ross or Faculty Appointments Committee Member (and Tax Prof) Karen Brown.

July 13, 2017 in Legal Education, Tax, Tax Prof Jobs | Permalink | Comments (0)

Google Wins $1.3 Billion French Tax Case