TaxProf Blog

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

Friday, May 24, 2019

Columbia Hosts Tax Workshop

Columbia (2017)Columbia Tax Workshop:

Brian Galle (Georgetown, Law), The Tax Exemption for Charitable Property: An Empirical Assessment
Discussant: François Gérard (Columbia, Economics)

Yehonatan Givati (Hebrew University, Law), Theories of Tax Deductions: Income Measurement Versus Efficiency
Discussant: Michael Doran (Virginia, Law)

Rebecca Kysar (Fordham, Law), Unraveling the Tax Treaty
Discussant: Mirit Eyal-Cohen (Alabama, Law)

Zach Liscow (Yale, Law), Toward Democratic Law and Economics: Moral Commitments & Inequality
Discussant: Jake Brooks (Georgetown, Law)

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May 24, 2019 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Fourth International Conference On Taxpayer Rights At Minnesota

International Conference

The National Taxpayer Advocate hosts the Fourth International Conference on Taxpayer Rights at Minnesota. U.S. Tax Prof speakers include:

  • Alice Abreu (Temple)
  • Les Book (Villanova)
  • Lilian Faulhaber (Georgetown)
  • Richard Greenstein (Temple)
  • Kristin Hickman (Minnesota)
  • Stephanie McMahon (Cincinnati)
  • Alan Rozenshtein (Minnesota)
  • Caleb Smith (Minnesota)
  • Dennis Ventry (UC-Davis)

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May 24, 2019 in Conferences, Tax | Permalink | Comments (0)

University Of Oklahoma Inflated Its Alumni Giving Data For 20 Years, U.S. News Strips Its #127 Ranking

U.S. News Generic RankingsU.S. News Rankings Updates:

University of Oklahoma: The school told U.S. News that it had inflated its alumni giving data since 1999, which affects its placement in the National Universities, Best Value Schools, Top Public Schools, Best Colleges for Veterans and A-Plus Schools for B Students rankings and lists. For the 2019 Best Colleges rankings, the University of Oklahoma originally reported its two-year alumni giving rate at 14 percent. The school informed U.S. News the correct value is 9.7 percent. The average alumni giving rate has a weight of 5 percent in the Best Colleges ranking methodology.

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May 24, 2019 in Law School Rankings, Legal Education | Permalink | Comments (0)

Lederman Presents The Fraud Triangle And Tax Evasion Today At The University Of Lisbon

Lederman (2018)Leandra Lederman (Indiana) presents The Fraud Triangle and Tax Evasion today at the University of Lisbon:

The “fraud triangle” is the preeminent framework for analyzing fraud in the accounting literature. It is a theory of why some people commit fraud, developed out of studies of individuals, including inmates convicted of criminal trust violations. The three components of the fraud triangle are generally considered to be (1) an incentive or pressure (usually financial), (2) opportunity, and (3) rationalization. There is a separate, extensive legal literature on tax compliance and evasion. Yet the fraud triangle is largely absent from this legal literature, although tax evasion is a type of fraud. This article rectifies that oversight, analyzing how the fraud triangle—and its expanded version, the “fraud diamond”—can inform the legal literature on tax compliance. The article argues that the fraud triangle can provide a frame that brings together distinct tax compliance theories discussed in the legal literature, the traditional economic (deterrence) model and behavioral theories focusing on such things as social norms or tax morale.

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May 24, 2019 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Thursday, May 23, 2019

Karen Brown Receives Bloomberg Lifetime Achievement Award For Distinguished Service In Tax


Professor Karen B. Brown Awarded 2018 Leonard L. Silverstein Award for Distinguished Service in Tax by Bloomberg Tax:

Bloomberg Tax announced the 2018 recipients for outstanding authorship in federal taxation and the Leonard L. Silverstein Award for Distinguished Service in TaxKaren B. Brown, Theodore Rinehart Professor of Business Law, was this year’s recipient of the Silverstein Award, named after the founder of the Tax Management Portfolios, for his long-standing contributions to the field of tax.

“One of the beautiful things about a lifetime achievement award is that it doesn't just recognize the achievements of the recipient, but it most especially acknowledges the contributions of all those, like Mr. Leonard Silverstein, who have gone before to blaze a path for us to follow,” said Professor Brown. “The Leonard L. Silverstein Award for Distinguished Service in Tax is an enormous honor which I will always cherish. I am very proud to accept it and hope to continue to bring honor to Mr. Silverstein's legacy.”

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May 23, 2019 in Legal Education, Tax | Permalink | Comments (0)

Duke Pays $54.5 Million To Settle Class Action Alleging Non-Poaching Agreement With UNC Stifled Lateral Faculty Moves

Duke UNCFollowing up on my previous posts:

Wall Street Journal, Duke University Moves to Settle No-Poach Case for $54.5 Million:

Duke and the University of North Carolina are fierce competitors on the basketball court, but when it comes to medical hiring, they have been cozy collaborators, according to a class action that Duke moved to settle Monday for $54.5 million.

The lawsuit, filed in 2015, alleges the rivals agreed not to hire each other’s medical faculty in certain circumstances.

The lead plaintiff, Duke radiology professor Danielle Seaman, contacted UNC about the possibility of becoming a thoracic radiologist there.  A UNC official allegedly responded that such a job switch wasn’t possible because Duke and UNC had agreed not to poach each other’s medical faculty for positions that would be a lateral move between the two institutions, according to the lawsuit.

The lawsuit sought to cover a class of more than 5,000 potentially affected faculty members.

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May 23, 2019 in Legal Education | Permalink | Comments (0)

IRS Releases 2018 Data Book

218 Data BookIR-2019-96, IRS Releases Data Book for 2018 (May 20, 2019):

The Internal Revenue Service today released the 2018 IRS Data Book, a snapshot of agency activities for the fiscal year.

The 2018 IRS Data Book describes activities conducted by the IRS from Oct. 1, 2017, to Sept. 30, 2018, and includes information about tax returns, refunds, examinations and appeals. The annual publication is illustrated with charts showing changes in IRS enforcement activities, taxpayer assistance levels, tax-exempt activities, legal support workload and IRS budget and workforce levels when compared to fiscal year 2017 and prior years. Included this year is a section on taxpayer attitudes from a long-running opinion survey.

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May 23, 2019 in IRS News, Tax | Permalink | Comments (0)

Tenured Kentucky Professor Sues Provost, Dean For Not Assigning Him Classes To Teach After Committee Rebuffed Attempt To Fire Him For Assigning His Book In His Classes And Keeping The $6k Royalties

Kentucky (University)Following up on my previous posts (links below):  Kentucky Kernel, Tenured Professor Sues Provost, Dean, Other Administrators:

Tenured journalism professor Buck Ryan has initiated legal proceedings against some of the University of Kentucky’s top administrative officials, alleging they defamed him and retaliated against him after he refused to resign. Ryan’s suit names university administrators Provost David Blackwell, Interim Dean of the College of Communication and Information Derek Lane, Director of the School of Journalism and Media Mike Farrell and chief audit executive Joseph Reed. 

The lawsuit comes after UK administrators initiated termination proceedings against Ryan in May 2018, following the publication of an internal audit that said Ryan profited from the sales of his self-authored textbook that was required for some of his classes.

DogThe internal audit stated that Ryan had made about $6,000 in royalties from his textbook "Writing Baby, Editing Dog & You: A Friendly Place to Begin Your Writing," since he began using the book, which has been required for Ryan’s JOU 101 since at least 2009.

When tasked with investigating the charges against Ryan, the University Senate Advisory Committee on Privilege and Tenure unanimously recommended to President Eli Capilouto and the Board of Trustees that Ryan keep his status as tenured professor. Ryan’s lawsuit alleges the audit, which was overseen by Reed, included “misrepresentations and false statements” that cast him in a false light.

After the publication of the internal audit, Provost David Blackwell told the Lexington Herald-Leader that he believed Ryan “stole from students. And he used university resources to do it." ...

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May 23, 2019 in Legal Education | Permalink | Comments (0)

IDC Herzliya Hosts Conference Today On Taxation And Globalization

IDC Logo (2019)IDC Herzliya Harry Radzyner Law School hosts the Atara Kaufman Annual Conference on Law and Globalization today on Taxation and Globalization:  A Research Workshop:

Session I: International Tax Competition
Chair: Rifat Azam (IDC Herzliya)
Reuven Avi Yonah (Michigan), Globalization, Tax Competition and the Fiscal Crisis of the Welfare State: A Twentieth Anniversary Retrospective
Tsilly Dagan (Bar Ilan), International Tax Policy: Between Competition and Cooperation

Session II: Taxation of Multinationals
Chair: David Elkins (Netanya)
Joseph Bankman (Stanford), Collecting the Rent: The Global Battle to Capture MNE Profits, 72 Tax L. Rev. ___ (2019) (with Mitchell Kane (NYU) & Alan Sykes (Stanford)) (reviewed by David Elkins (Netanya) here)
Yoram Margalioth (Tel Aviv), Global Collective Action

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May 23, 2019 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Western State Submits Teach-Out Plan To ABA; Sixth Law School To Close Since 2016

Western State Logo (2019)Following up on my previous posts (links below):  ABA Journal, Western State College of Law Submits Proposed Teach-Out Plan to ABA:

Western State College of Law, which is part of the embattled Argosy University System, has submitted a proposed teach-out plan with the ABA after losing its federal student loan money, being placed in receivership and conducting a search for an acquisition partner. 

Details of what is in the Callifornia school’s proposal were not disclosed on the Section of Legal Education and Admissions to the Bar website, where the notice is posted. Barry Currier, the ABA’s managing director of accreditation and litigation, said that other than the notice, everything else about the proposal is not public.

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May 23, 2019 | Permalink | Comments (0)

Joint Committee On Taxation: Overview Of The Tax Gap

Joint Tax CommitteeFollowing up on my previous post, House Holds Hearing Today On The Tax Gap:  the Joint Committee on Taxation has released Overview Of The Tax Gap (JCX-19-19) (May 08, 2019):

This document ... provides a standard definition of the tax gap, a description of issues relevant to measurement of the tax gap, and a discussion of taxpayer behavioral responses and the effectiveness of measures to increase compliance.  ...

A standard definition of the tax gap is the shortfall between the amount of tax voluntarily and timely paid by taxpayers and the actual tax liability of taxpayers. It measures taxpayers’ failure to accurately report their full tax liabilities on tax returns (i.e., underreporting), pay taxes due from filed returns (i.e., underpayment), or file a required tax return altogether or on time (i.e., non-filing). Estimates of the tax gap provide a picture of the level of overall noncompliance by taxpayers for a particular tax year, and include shortfalls in individual income taxes, corporate income taxes, employment taxes, estate taxes, and excise taxes. The individual behavioral responses to taxation that result in the tax gap raise a set of important policy questions, such as the optimal level of resources to devote to tax administration and the manner in which those resources are best deployed.  

The Internal Revenue Service (“IRS”) periodically conducts studies to estimate the size of the tax gap and analyze its components. Table 1 indicates that in the most recent study, the estimated annual gross tax gap, per year on average for tax years 2008-10, was $458 billion and the annual net tax gap, which is the gross tax gap adjusted for late payments and collections due to enforcement activities, was $406 billion. Adjusted for inflation, the gross and net tax gaps are $504 billion and $447 billion in 2016 dollars, respectively.  With total average tax liabilities of $2.5 trillion per year between 2008 and 2010, the voluntary compliance rate is 81.7 percent and the net compliance rate is 83.7 percent.

Tax Gap 1

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May 23, 2019 in Congressional News, Gov't Reports, Tax | Permalink | Comments (0)

Judge Denies Third Request For Delay In June 3 Trial Of Suspects In Dan Markel's 2014 Murder

Wednesday, May 22, 2019

NY Times: IRS Memo Undercuts Mnuchin On Withholding Trump’s Tax Returns

New York Times, I.R.S. Memo Undercuts Mnuchin on Withholding Trump’s Tax Returns:

The Internal Revenue Service has no choice but to honor congressional requests for President Trump’s tax returns unless he invokes executive privilege to protect them, according to a draft legal memo written by agency staff members.

The memo appears to undercut the reasoning offered by Treasury Secretary Steven Mnuchin, who has refused to comply with Democrats’ requests because they lack a “legitimate legislative purpose.” Mr. Mnuchin said he made his decision after consulting with lawyers from the Treasury Department, the I.R.S. and the Justice Department.

But the I.R.S. memo says the Treasury secretary does not have the authority to deny tax-writing committees’ requests for taxpayer returns.

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May 22, 2019 in Tax | Permalink | Comments (0)

33% Of Female Attorneys Have Been Sexually Harassed At Work, 50% Have Been Bullied

US TooBloomberg, Third of Female Lawyers Have Been Sexually Harassed, Report Finds:

One in three female attorneys has been sexually harassed at work, and half have been bullied, according to a global survey that brings law firms into a #MeToo movement that started in Hollywood and has engulfed much of the corporate world.

The International Bar Association survey — based on the online responses of 6,980 attorneys from 135 countries — found sexual harassment in the industry is “common” and bullying is “rife” [Us Too: Bullying and Sexual Harassment in the Legal Profession].

Since the #MeToo movement kicked off two years ago, law firms have been hired to advise corporations on how to handle harassment allegations. IBA president Horacio Bernardes Neto said attorneys needed to get their own hiring and workplace behavior in order because of the risk being called out for hypocrisy.

“These are shocking numbers,” said Christina Blacklaws, president of the Law Society, which represents attorneys in England and Wales. “We really need to eradicate this.” Since many incidents go unreported, it’s possible that the industry “wasn’t aware of the scale and size of the problem,” she said. ...

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May 22, 2019 in Legal Education | Permalink | Comments (0)

IRS Office Of Chief Counsel Seeks To Hire JDs/Tax LLMs For Summer Honors And Legal Programs

IRS Office of Chief Counsel Logo (2015)Michael J. Desmond (IRS Chief Counsel), IRS Office of Chief Counsel Summer Honors Program and Summer Legal Programs:

After many years of attrition, the IRS Office of Chief Counsel is turning a corner this year and looking to recruit law students and lawyers from a diverse group of well qualified candidates. The Office of Chief Counsel has always offered unparalleled opportunities for professional advancement. With implementation of the most comprehensive tax reform law in a generation under way, working with the Chief Counsel’ Office is a truly unique opportunity to participate in the development of entirely new provisions of tax law, both in technical positions drafting guidance and providing advice and in trial attorney positions handling cases in Tax Court.

We generally accepts applications as early as summer 2019 for Honors Program positions beginning fall 2020 and Summer Legal Program positions for summer 2020. This year, applicants can begin applying to our Honors Program beginning May 20, 2019, and have until September 30, 2019, to submit application materials. Although the final deadline to apply is September 30th, both the Honors Program and Summer Legal Program announcements have two earlier application cutoff dates, July 31st and September 3rd. Applicants who apply by the earlier deadlines will be considered and likely receive offers before the final deadline, so please encourage interested applicants to apply as soon as possible.

Here is some key information about the Honors Program and Summer Legal Program, along with application links that law students and recent graduates can use to apply. The application links provide job descriptions, cities where we’re hiring, and eligibility and hiring criteria information.

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May 22, 2019 in IRS News, Tax | Permalink | Comments (0)

ABA's Tougher Bar Pass Rule For Law Schools Applauded, Derided

ABA Logo (2016)Following up on Saturday's post, ABA: Law Schools Will Lose Their Accreditation Unless 75% Of Their Graduates Pass The Bar Within Two Years, Beginning With The Class of 2017:, ABA's Tougher Bar Pass Rule for Law Schools Applauded, Derided:

Three days after the American Bar Association decided to toughen the bar passage standard for law school accreditation, legal educators have sharply diverging views on what the new rule will mean and how things might change—or not.

The Council of the Section of Legal Education on Friday adopted a long-debated rule change that reduces the time—from five years to two years—that schools have to get at least 75 percent of their graduates to pass the bar exam.

Proponents say the ABA rightly has cracked down on underperforming campuses, while opponents argue that the change will exacerbate the uneven playing field between schools in different jurisdictions and imperil diversity efforts. ...

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May 22, 2019 in Legal Education | Permalink | Comments (0)

Tax Papers At Today's Junior Faculty Forum At Richmond

Richmond (2018)Tax presentations at today's Junior Faculty Forum at Richmond:

Hayes Holderness (Richmond), Legislative Evasion through Tax:

Approximately 20 states impose specific excise taxes on the possession or sale of controlled substances (i.e., illegal drugs). Often these taxes take the form of stamp taxes, requiring the taxpayer to purchase and affix stamps to the controlled substances in his or her possession. These taxes are rarely, if ever, enforced or complied with before the taxpayer is charged in the criminal justice system for the possession of the controlled substance. Once a taxpayer is brought into the criminal justice system, the state taxing authority is alerted and an assessment for the controlled substance tax is issued.

Courts and commentators have addressed the major criminal law issues associated with the taxes—namely concerns about double jeopardy and self-incrimination. From a tax perspective, the taxes might not appear particularly problematic; they merely function as Pigouvian taxes on the possession or sale of controlled substances. However, because these taxes are imposed on activities already sanctioned through another area of law and because enforcement of the taxes relies on non-tax actors, concerns arise about the incidence and administration of the taxes. These concerns call in to question the effectiveness of controlled substances taxes and suggest that the taxes serve as low-salience vehicles for legislators to achieve non-tax policy results.

Daniel Schaffa (Richmond), Valuable Realizations (with James R. Hines Jr. (Michigan)):

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May 22, 2019 in Conferences, Scholarship, Tax | Permalink | Comments (0)

University Of Luxembourg Hosts Seminar Today On International Tax Developments: Cross-Atlantic Perspectives

LuxThe University of Luxembourg hosts a seminar today on International Tax Developments: Cross-Atlantic Perspectives:

  • Yariv Brauner (Florida), The Digital Tax Future in the U.S. and the EU
  • Leandra Lederman (Indiana), Tax Rulings and Transparency: "Taxpayers sometimes seek advance tax rulings to obtain certainty regarding the tax treatment of planned transactions. The transparency of these rulings, including Advance Pricing Agreements regarding intra-company transfer pricing, has changed significantly in the past several years. One of the triggers for change was the 2014 “LuxLeaks” scandal, revealing what the press sometimes termed “secret tax deals” between the Luxembourg tax authority and multinational companies. Since then, legal changes require tax authorities to share cross-border advance rulings with other countries’ tax authorities. In addition, Luxembourg has formalized and modified its rulings practice. This paper examines what these legal changes have meant for Luxembourg and the United States, and whether the current level of rulings transparency is appropriate and sufficient."

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May 22, 2019 in Conferences, Scholarship, Tax | Permalink | Comments (0)

How To Fix The U.S. News Law School Rankings

U.S. News Law (2019)Christopher D. Iacono (J.D. 2019, Pennsylvania), Legally Unhappy: How US News and Law Schools Have Failed and How This Can Be Fixed:

Law schools are deficient in directing students to career paths that suit their interests. Research has shown that top law school graduates are not happy. Why are some of the most driven people on earth dissatisfied with their legal careers? Too much emphasis has been placed on the U.S. News & World Report law school rankings [hereinafter US News]. US News does not structure their rankings on categories that reflect a high-quality law school experience. Law school deans have found ways to manipulate rank. Law school graduates are forced into BigLaw to service the huge debt that often comes with attending the “best” schools. Law schools ignore these issues and increase their tuition to pay full-time faculty who focus more on scholarship than teaching.

The issues are soluble. First, US News should revamp their criteria to accentuate value and satisfaction. Law schools should mirror those goals through practical steps to reduce tuition and enhance professional satisfaction. ...

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May 22, 2019 in Law School Rankings, Legal Education | Permalink | Comments (2)

Call For Papers: National Tax Association

NTA TampaDear tax colleagues,

You are invited to submit a paper, extended abstract, or complete session to the National Tax Association annual conference, which will be held in Tampa, November 21-23, 2019.  NTA has extended the submission deadline to June 8.

The official NTA call for papers is copied below.  This year, law professors will submit to specific subject areas, instead of submitting to a general “Law/Practitioner” area.  The subject areas include: (1) Accounting; (2) Administration and Compliance; (3) Corporate Tax; (4) Developing World; (5) International Tax; (6) Behavioral Public Finance; (7) Charity/Public Goods; (8) Environmental/ Energy; (9) Education; (10) Health; (11) Personal Tax/Labor; (12) Macro and Fiscal Policy; (13) Political Economy; (14) Retirement/SSA; (15) State/Local Public Finance; and (16) Transfers/Welfare State. 

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May 22, 2019 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Tuesday, May 21, 2019

Law Professors Should Be More Like Football Coaches

Mind 2New York Times op-ed:  Math Teachers Should Be More Like Football Coaches, by John Urschel (Ph.D. Candidate, MIT; Guard, Baltimore Ravens (2014-17); author, Mind and Matter: A Life in Math and Football (2018)):

Growing up, I thought math class was something to be endured, not enjoyed. I disliked memorizing formulas and taking tests, all for the dull goal of getting a good grade. In elementary school, my mind wandered so much during class that I sometimes didn’t respond when I was called on, and I resisted using the rote techniques we were taught to use to solve problems. One of my teachers told my mother that I was “slow” and should repeat a grade. ...

What I wanted to do was play college football. I was an offensive lineman. My hero was Jake Long, the starting left tackle for the University of Michigan who would later be selected first in the N.F.L. draft. My ambition was to get an athletic scholarship to attend a Big Ten school.

The chances of that happening were very low. In high school, I weighed “only” 220 pounds — about 80 pounds less than a big-time college tackle. I was an above-average athlete, but not a freak of nature. And my high school in Buffalo was an academic powerhouse, not a “feeder” school for college sports programs.

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May 21, 2019 in Legal Education | Permalink | Comments (1)

Chodorow: Lost In Translation

Adam Chodorow (Arizona State), Lost in Translation, 97 Taxes 171 (Mar. 2019):

Today’s tax code contains a dizzying array of loss-limiting provisions, serving a wide range of purposes. Some are normative, such as the ban on deducting personal losses, but the vast majority are designed to prevent taxpayers from manipulating the tax rules to gain advantages tax authorities did not intend. These anti-abuse provisions can add significant complexity to the law and are often over- or under-inclusive, sometimes both at the same time. Most articles considering loss limiting provisions focus on only one or two provisions in isolation. This article takes a more comprehensive approach with two key goals.

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May 21, 2019 | Permalink | Comments (0)

Elizabeth Warren's 7% Real Corporate Profits Tax Would Politicize GAAP, Harm Investors And Employees

Warren 2020Wall Street Journal op-ed:  Don’t Let Warren Politicize Accounting, by Scott Dyreng (Duke):

Sen. Elizabeth Warren is campaigning for president like Robin Hood in the Hamptons. But the Massachusetts Democrat’s proposed Real Corporate Profits Tax—her plan to tax highly profitable companies on their financial accounting incomes—may do more harm than good to the working class she claims to champion.

The U.S., like other developed nations, uses two accounting systems. Companies report income to investors following Generally Accepted Accounting Principles, or GAAP, which are determined by the private, nonpolitical Financial Accounting Standards Board. The paramount purpose of this standard is to provide investors with information they can use to allocate capital soundly.

To file their taxes, companies follow different accounting rules, defined by the Internal Revenue Code. Congress has multiple goals in the way it defines the corporate tax, from raising revenue and redistributing wealth to regulating companies’ behavior and increasing U.S. competitiveness.

Ms. Warren calls for a 7% levy on financial-accounting earnings above $100 million, on top of the 21% tax corporations already pay on taxable income. Even putting aside its negative impact on profits, the new tax would hurt investors by subjecting accounting standards to politics.

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May 21, 2019 in Tax | Permalink | Comments (0)

31% Passed February 2019 California Bar Exam, Up 4% From Last Year

California Bar ExamNational Law Journal, Nearly 7 in 10 Flunked California's February 2019 Bar Exam:

Still, the success rate—31.4%—increased 4.1 percentage points from the historically low pass rate of 27.3% recorded in February 2018.

Only 31.4% of would-be attorneys passed California’s February 2019 bar exam, marking the second-lowest pass rate on the notoriously difficult test in 35 years, according to figures released by the state bar Friday night.

The success rate was 4.1 percentage points higher than the historically low pass rate of 27.3% recorded in February 2018.

Pass rate (rounded to whole numbers) by law school type:

School Type



California ABA



Out-of-State ABA



California Accredited (but not ABA)



Unaccredited: Fixed-Facility



Unaccredited: Correspondence



Unaccredited Distance Learning



All Others



All Applicants



Pepperdine's pass rate for first-time takers was 67% (compared to the 45% California ABA average). Pepperdine's pass rate for repeat test-takers was 53% (compared to the 38% California ABA average).

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May 21, 2019 in Legal Education | Permalink | Comments (0)

Field: Tax Lawyers As Tax Insurance

Heather M. Field (UC-Hastings), Tax Lawyers as Tax Insurance, 60 Wm. & Mary L. Rev. ___ (2019):

Transactional tax lawyers, by rendering tax opinions, provide a version of insurance to clients. This insurance is clearly incomplete, but by providing a tax opinion, a lawyer conditionally agrees to indemnify the client for at least part of the potential loss the client incurs if the favorable tax treatment described in the opinion is successfully challenged. Although insurance is not the primary function of transactional tax lawyers, and although this Article does not argue that tax opinions should be regulated as insurance, indemnification — a key element of insurance — is an important part of the economic relationship between a client and a lawyer who provides a tax opinion. Surprisingly, this insurance-like function has been largely overlooked in the literature. Thus, by identifying and exploring the insurance-like aspect of the transactional tax lawyer’s role, this Article fills a gap in the literature and offers a new framework for understanding the value of tax lawyers.

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May 21, 2019 in Scholarship, Tax | Permalink | Comments (1)

AALS Tax Section Call For Papers: New Voices In Tax Law & Policy

AALS (2018)The AALS Section on Taxation is pleased to announce the following Call for Papers. Selected papers will be presented at a works-in-progress session at the 2020 AALS Annual Meeting in Washington, D.C. The works-in-progress session is tentatively scheduled for Friday, January 3, 2020. This program will provide speakers the opportunity to present their work and receive feedback from commentators in the field.

Eligibility: Scholars teaching at AALS member schools or non-member fee-paid schools with seven or fewer years of full-time teaching experience as of the submission deadline are eligible to submit papers. For co-authored papers, all authors must satisfy the eligibility criteria.

Due date: 5 p.m. PDT, Thursday, August 15, 2019.

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May 21, 2019 in Conferences, Legal Education, Scholarship, Tax | Permalink | Comments (0)

'We Have Parents Who Call Their Kids At Harvard And Michigan To Wake Them Up Every Morning'

Wall Street Journal, The Overprotected American Child:

Overzealous parenting can do real harm. Psychologists and educators see it as one factor fueling a surge in the number of children and young adults being diagnosed with anxiety disorders. According to a study published this year in the Journal of Developmental & Behavioral Pediatrics, the number of children aged 6 to 17 whose parents said they were currently diagnosed with anxiety grew from 3.5% in 2007 to 4.1% in 2012. And in a 2017 survey of more than 31,000 college students by the American College Health Association, 21.6% reported that they had been diagnosed with or treated for anxiety problems during the previous year. That is up from 10.4% in a 2008 survey. ...

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May 21, 2019 in Legal Education | Permalink | Comments (0)

Making Only America Great? Non-U.S. Market Reactions To U.S. Tax Reform

Fabio B. Gaertner (Wisconsin), Jeffrey L. Hoopes (North Carolina) & Area Braden Williams (Texas), Making Only America Great? Non-U.S. Market Reactions to U.S. Tax Reform:

We examine U.S. tax reform’s effect on foreign firms’ stock returns. Examining key tax reform events, we find little average foreign firm market reaction to tax reform. However, this average effect masks great heterogeneity by country, industry, and firm. Chinese firms experience large negative returns, especially steel manufacturers, while the rest of the world experiences positive returns. Firms in industries that export to the U.S. and firms in financial distress also experience larger negative returns. Overall, our results suggest that U.S. tax reform had varied, yet systematic effects on foreign firms’ shareholders’ wealth and the global competitive landscape.

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May 21, 2019 in Scholarship, Tax | Permalink | Comments (0)

Monday, May 20, 2019

Satterthwaite: Rewarding Honest Taxpayers — An Experimental Assessment

Florida Tax Review (2018)Emily Satterthwaite (Toronto), Rewarding Honest Taxpayers: An Experimental Assessment, 22 Fla. Tax Rev. 200 (2019):

Shrinking budgetary allocations for tax enforcement at the U.S. federal level have placed an unprecedented premium on low-cost policies that promote voluntary tax compliance. In other jurisdictions, tax administrators have experimented with rewarding taxpayers for voluntarily complying with tax laws, but there has been an absence of reward-focused policy experimentation in the United States. To explore the efficacy of rewards among U.S. taxpayer populations, a multi-period online tax reporting experiment was conducted featuring a simple reward intervention: a token monetary amount pre-announced and provided to participants who were audited and found to have fully complied. The reward failed to increase average post-audit compliance levels as compared to the no-reward control condition, regardless of whether random audits or non-random (i.e., conditional on past detected evasion) audits were used. However, the reward treatment condition in combination with random audits was strikingly effective with respect to an alternative measure of tax compliance: “consistent compliance,” or the outcome in which a participant voluntarily reports all of her income in each and every period of the experiment.

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May 20, 2019 in Scholarship, Tax | Permalink | Comments (0)

Morehouse College Commencement Speaker To Pay Student Loans Of Graduates ($40 Million) — Tax-Free

New York Times, Morehouse Graduates’ Student Loans to Be Paid Off by Billionaire:

The 396 young men began the day as students in caps and gowns, ready to graduate from Morehouse College — full of hope, but burdened in most cases with the debts that financed their education.

Then their commencement speaker went off-script with an extraordinary pledge: the newly minted alumni of the historically black college in Atlanta would go forth into the world student debt-free.

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May 20, 2019 in Tax | Permalink | Comments (2)

Children Of Deceased Soldiers, Low-Income College Students Are Taxed Like Trust-Fund Babies Under 2017 Tax Act

Wall Street Journal Tax Report, The Surprising Tax Bill for Sons and Daughters of Gold-Star Families:

The Kiddie Tax is a decades-old law meant to prevent the wealthy from shifting assets to children in order to take advantage of their lower income-tax rates.

But a revision to the tax in the big overhaul passed by Congress in 2017 is raising taxes on as many as 10,000 children of deceased service members who earn an average annual benefit of about $13,000, according to Department of Defense data provided by the Tragedy Assistance Program for Survivors, or TAPS. It’s a nonprofit group for families who have lost service members that’s working to change the law.

And the new rules reach well beyond military families. They can also raise taxes on children from lower-income families who receive income after a tragedy and pose a threat to millions of students receiving college financial aid.

Congress passed the Kiddie Tax in 1986. Until then a parent could, say, give a child appreciated stock and the child could sell it, pay tax at lower rates, and use the proceeds to pay for college tuition or a Corvette.

The 1986 provision levied the Kiddie Tax on a broad range of children’s “unearned” income above an exemption, which currently is $2,200. Above that amount, the children owed tax at the parents’ rate. The levy has never applied to a youngster’s earnings from being a camp counselor or designing websites.

Many features of the 1986 Kiddie Tax were complex, however. To simplify, the 2017 overhaul switched the Kiddie Tax rate from the parents’ rate to trust tax rates. These kick in at a very low level of taxable income: For 2019, the top rate of 37% takes effect at just $12,751.

Kiddie Tax

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May 20, 2019 in Legal Education, Tax | Permalink | Comments (0)

The Benefits Of Sleeping With Your Dog

JosieNew York Times op-ed:  I Traded the 12-Step Program for a Dog, by Tyler Watamanuk:

Most nights, my dog River sleeps in my bed. He is a red heeler, although his speckled coat is closer to an auburn-bronze than any shade that could be earnestly called “red.” Before I fall asleep, he jumps onto the comforter and curls up into a furry crescent moon next to me, nuzzling his rust-colored snout into my chest and wedging himself somewhere in between my limbs and heart.

When he rests beside me, I can feel my heartbeat slow down ever so slightly, and a woozy solace unknots my restless brain. For the two years we lived on a noisy Brooklyn street, the harsh sounds of the big city outside my window even seemed to soften. His presence feels more comforting than the slow euphoria of hydrocodone or the dizzying blackout of too many whiskey sodas — feelings I was well acquainted with before I got sober and welcomed this dog into my life.

This calming effect felt unmistakable and tangible, like the feeling of walking barefoot on freshly cut grass. I thought I might be imagining it, so I eventually looked it up: According to Psychology Today, lying next to a dog’s rhythmic breathing can help lull you to sleep and also increase the flow of oxytocin, a hormone associated with affection and happiness. Speaking from experience, I believe both of these things to be true.

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May 20, 2019 in Legal Education | Permalink | Comments (4)

SAT To Give Students ‘Adversity Score’: 1 (Privilege) To 100 (Hardship)

Wall Street Journal, SAT to Give Students ‘Adversity Score’ to Capture Social and Economic Background:

WSJ 2The College Board plans to assign an adversity score to every student who takes the SAT to try to capture their social and economic background, jumping into the debate raging over race and class in college admissions.

This new number, called an adversity score by college admissions officers, is calculated using 15 factors including the crime rate and poverty levels from the student’s high school and neighborhood. Students won’t be told the scores, but colleges will see the numbers when reviewing their applications.

Fifty colleges used the score last year as part of a beta test. The College Board plans to expand it to 150 institutions this fall, and then use it broadly the following year.

How colleges consider a student’s race and class in making admissions decisions is hotly contested. ...

The College Board, the New York based nonprofit that oversees the SAT, said it has worried about income inequality influencing test results for years. White students scored an average of 177 points higher than black students and 133 points higher than Hispanic students in 2018 results. Asian students scored 100 points higher than white students. The children of wealthy and college-educated parents outperformed their classmates. ...


An adversity score of 50 is average. Anything above it designates hardship, below it privilege. ...

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May 20, 2019 in Legal Education | Permalink | Comments (2)

Lesson From The Tax Court: Mostly Dead Corporation Cannot File Petition

Tax Court (2017)As we learned from this scene in The Princess Bride, there’s dead...and then there’s mostly dead. 

In Timbron Holdings Corporation v. Commissioner, T.C. Memo. 2019-31 (April 8, 2019) (Judge Vasquez), the Tax Court decided that it could not hear the petition filed by a mostly dead corporation.  In reaching this conclusion, Judge Vasquez carefully followed existing Tax Court precedents to hold: (1) a corporation whose charter is suspended under California law (i.e. is mostly dead) has no capacity to file a Tax Court petition; (2) the corporation’s lack of capacity is not a defense that the government must raise but is instead an element of §6213’s jurisdictional requirements; and (3) “reliance on equity and policy considerations [cannot] overcome a jurisdictional defect.”

The idea that §6213 is a jurisdictional statute is an old idea.  Really old.  Decrepitly old.  If the right right case goes up on appeal, I think an appellate court will likely decide that old idea is dead.  Deceased.  Kaput.  Expired.  Gone.  Done in.  All-the-way dead.  Parrot dead.  To beat the dead horse, an appellate court is likely to find that §6213 is not a jurisdictional restriction on the Tax Court but is instead a “claims processing rule,” a term the Supreme Court uses to describe limitations that are important but not jurisdictional.  You can find the deathly dull details in my forthcoming article (Fall 2019 issue of The Tax Lawyer).

Timbron is not the right case to take on appeal.  I think the result would be the same even if §6213 were treated as a straight-forward non-jurisdictional limitations period.  But, either way, the result creates a curious contradiction in the Tax Court Rules.  Details below the fold.

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May 20, 2019 in Bryan Camp, New Cases, Scholarship, Tax, Tax Practice And Procedure | Permalink | Comments (1)

Hemel: Steven Mnuchin’s Mysterious Argument That He Is 'Not Authorized' To Hand Over Trump’s Tax Returns

Daniel Hemel (Chicago), Steven Mnuchin’s Mysterious Argument:

Almost no one was surprised when Treasury Secretary Steven Mnuchin said today that he will not comply with the House Ways and Means Committee’s subpoena for President Trump’s tax filings. Mnuchin already had made clear that he believes he is under no obligation to hand over those documents to House members. But there was something puzzling about Mnuchin’s letter in response to the Ways and Means Committee’s subpoena — something that even Mnuchin’s defenders will have a difficult time justifying.

“In reliance on the advice of the Department of Justice, we have determined that the Committee’s request lacks a legitimate legislative purpose, and pursuant to section 6103, the Department is therefore not authorized to disclose the requested returns and return information,” Mnuchin wrote. The emphasis is mine, not Mnuchin’s. ...

Here’s why that’s puzzling.

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May 20, 2019 in Tax | Permalink | Comments (0)

TaxProf Blog Weekend Roundup

Sunday, May 19, 2019

Fifth Annual Texas Tax Faculty Workshop At Houston

Houston (2017)The University of Houston Law Center hosted the Fifth Annual Texas Tax Faculty Workshop (program) on Friday:

Johnny Buckles (Houston), Curbing (or not) Foreign Influence on United States Politics and Policies through the Federal Taxation of Charities
Commentator: Terri Helge (Texas A&M)

Cal Johnson (Texas), Pay Back of the 2017 Act — Deficits by Wealth
Commentator: Bret Wells (Houston)

Bryan Camp (Texas Tech), Taxation of Electronic Gaming
Commentator: Bruce McGovern (South Texas)

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May 19, 2019 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Repetti: Getting To The Bottom Of Trump's Tax Secret

The Hill op-ed:  Getting to the Bottom of Trump's Tax Secret, by James R. Repetti (Boston College):

Recent revelations in the New York Times about President Trump’s $1.17 billion tax losses during the period from 1985-1994 have revived demands that he release his tax returns.

Moreover, many have discredited the attempt of his advisors to attribute the losses to generous depreciation deductions. His losses of $1.17 billion were far too large to be attributable merely to tax depreciation deductions.

Rather, a significant portion of his losses likely were operating losses. Indeed, Trump has hinted publically at least once that he struggled financially during this time period.

But lurking behind the veil of secrecy created by Trump’s failure to disclose his returns lurks another, more troubling, secret. Because of tax law nuances, it is possible that either Trump’s losses were significantly higher than the reported $1.17 billion (approximately $2 billion during that period) or, alternatively, that Trump was insolvent. ...

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May 19, 2019 in Tax | Permalink | Comments (1)

Congratulations, Pepperdine Law School Class of 2019

Graduation Stage

Congratulations to the Pepperdine Law Class of 2019. It has been an honor to have you among us these three years. You have left an indelible mark here — we have literally been tested by fire together and we are all stronger for the experience. We are confident that each and every one of you has a bright future in the law. Please continue to share your lives with us and stay in touch in the coming years. We look forward to welcoming you back to campus in December for your bar swearing in ceremony.

I hope you enjoyed our speakers — 3L Ava Jahanvash, Distinguished Alumnus and Washington State Head Football Coach Mike Leach ('86), and Commencement Speaker and Federal Communications Commission Chair Ajit Pai (who tweeted about his experience and posted his speech online) — as much as I did.

I also cherish our second annual Baccalaureate Service the night before graduation for our graduating 3Ls and their friends and families.

Baccalaureate 1

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May 19, 2019 in Legal Education | Permalink | Comments (1)

The Top Five New Tax Papers

SSRN Logo (2018)There 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. [430 Downloads]  Taxing the Digital Economy Post BEPS ... Seriously, by Andrés Báez (Universidad Carlos III de Madrid) & Yariv Brauner (Florida)
  2. [398 Downloads]  Residual Profit Allocation by Income, by Michael Devereux (Oxford), Alan Auerbach (UC-Berkeley), Michael Keen (IMF), Paul Oosterhuis (Skadden), Wolfgang Schön (Max Planck) & John Vella (Oxford) (reviewed by Christine Kim (Utah) here)
  3. [170 Downloads]  Fixing Philanthropy: A Vision for Charitable Giving and Reform, by Roger Colinvaux (Catholic)
  4. [117 Downloads]  Critical Tax Thinking, by Edward Kleinbard (USC)
  5. [112 Downloads]  The Digital Services Tax as a Tax on Location-Specific Rent, by Wei Cui (British Columbia) & Nigar Hashimzade (Durham University) reviewed by Kim Brooks (Schulich School of Law, Dalhousie University) here)

May 19, 2019 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, May 18, 2019

ABA: Law Schools Will Lose Their Accreditation Unless 75% Of Their Graduates Pass The Bar Within Two Years, Beginning With The Class of 2017

ABA Logo (2016)ABA Journal, ABA Legal Ed Section's Council Adopts Tighter Bar Pass Standard; Clock For Compliance Starts Now:

Following multiple years of discussion, and two rejections from the American Bar Association’s House of Delegates, the council of the ABA’s Section of Legal Education and Admissions to the Bar adopted a proposed revision to tighten an accreditation standard regarding bar passage Friday.

To be in compliance with the revised version of Standard 316, at least 75% of a law school’s graduates who sat for a bar exam must pass within two years of graduation. Under the previous rule, there were various ways to meet the standard, and no law school had been found to be out of compliance with it.

Those ways include:

  • Having a 75% pass rate for all graduates over the five most recent calendar years;
  • Having a 75% pass rate for at least three of those five years;
  • And having at least 70% of its graduates pass the bar at a rate within 15 percentage points of the average first-time bar pass rate for ABA-approved law school graduates in the same jurisdiction for three out of the five most recently completed calendar years.

Under ABA rules, the House of Delegates can send a proposed revision back to the section’s council twice, but the council has the final decision on matters related to law school education. The House of Delegates voted against the proposed revision in February 2017 and this past January.

An FAQ sheet posted on the section’s website before the vote was taken states that if adopted, the proposed revision “will be effective at the conclusion” of Friday’s meeting. The first time that law schools would be subject to the revision is spring 2020, when they file ultimate bar passage rates of 2017 graduates. Like the old version of Standard 316, once it’s determined that a law school does not meet the standard requirements, they have two years to come into compliance.

For how many law school graduates of the classes of 2015 2016 passed the bar within two years of graduation, see:

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May 18, 2019 in Legal Education | Permalink | Comments (2)

This Week's Ten Most Popular TaxProf Blog Posts

NY Times: The Case For Doing Nothing

New York Times op-ed:  The Case for Doing Nothing, by Olga Mecking:

Keeping busy?

Running from place to place and laboring over long to-do lists have increasingly become ways to communicate status: I’m so busy because I’m just so important, the thinking goes.

Perhaps it’s time to stop all this busyness. Being busy — if we even are busy — is rarely the status indicator we’ve come to believe it is. Nonetheless, the impact is real, and instances of burnout, anxiety disorders and stress-related diseases are on the rise, not to mention millennial burnout.

There’s a way out of that madness, and it’s not more mindfulness, exercise or a healthy diet (though these things are all still important). What we’re talking about is … doing nothing. Or, as the Dutch call it, niksen. ...

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May 18, 2019 in Legal Education | Permalink | Comments (1)

Tokic: Taxing Greed

Genevieve Tokic (Northern Illinois), Taxing Greed, 50 Loy. L.A. L. Rev. 607 (2017):

Appeals to greed in support of various tax proposals are often seen in response to populist moods in politics. Such appeals may be used to garner political support for a policy or proposal. However, there has been little academic consideration of the role of greed (or attitudes towards greed) in the law, and in tax law in particular. This Article seeks to fill that gap by taking a close look at the concept of greed. In doing so, the Article first surveys the history of greed and its meaning, and draws on political philosophy and economic literature to provide a working definition of greed. The Article then investigates the role of greed in tax law, focusing on the issue of executive compensation, in order to consider whether “greed” is merely political rhetoric, or if it can provide a framework or analytical tool that is useful for crafting tax rules aimed at correcting or remedying excess. The Article ultimately concludes that, while “greed” is indeed a powerful rhetorical tool, its application in tax law and policy should be limited to situations where greed manifests as the appropriation of money, wealth or goods for personal gain, accompanied by illegality, a breach of fiduciary duty or contract, or indicators of market failure or manipulation. In such scenarios, carefully considering the meaning of greed and thinking about our reactions to it in crafting tax law and policy may help tailor rules to target the negative aspects of the behavior in question.

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May 18, 2019 in Scholarship, Tax | Permalink | Comments (0)

Friday, May 17, 2019

Weekly SSRN Tax Article Review And Roundup: Kim Reviews Cui's The Digital Services Tax: A Conceptual Defense

This week, Young Ran (Christine) Kim (Utah) reviews a new work by Wei Cui (UBC), The Digital Services Tax: A Conceptual Defense (April 2019).

KimThere are already multiple versions of a real digital services tax (DST) that have been implemented or proposed in multiple countries. France released a bill introducing a DST retroactively to January 1, 2019, UK will introduce a DST in April 2020, and other European countries, such as Spain, Austria, and Italy, are discussing or have proposed a bill mimicking the March 2018 DST proposal from the European Council. While details of the proposed DSTs vary, in general, a DST is a 2-3% tax imposed on the gross revenues of specific digital business models where revenues are linked to the participation of users in the country exercising such taxing right. It also establishes a specified revenue threshold which triggers the DST. The goal of the DST is to capture profits earned by multinationals that reflect value contributed by users of such digital business.  

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May 17, 2019 in Christine Kim, Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Legal Education Roundup

Tax Policy In The Trump Administration

More Commentary On Trump's Taxes And Tax Returns

The Disappearance Of Ampersands In Law Firms Names

AmpersandABA Journal, For Law Firms, the Ampersand Is a Character Worth Saving:

Earlier this year, the venerable law firm long known as Milbank, Tweed, Hadley & McCloy announced that it had slimmed down its title to the breezy “Milbank.”

Tweed, Hadley and McCloy, perhaps, mourned the change, but it is unlikely that many people shed a tear for another victim that fell just as surely as those three names: the “&,” also known as the ampersand.

For more than two centuries, the ampersand flourished in its preferred environment: BigLaw titles. No one can dispute that the ampersand served BigLaw well, adorning the titles of virtually all the most prestigious members of the BigLaw species. As late as the 1990s, it was nearly impossible to name a preeminent law firm that did not proudly boast an ampersand in its title.

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May 17, 2019 in Legal Education | Permalink | Comments (5)

The Top 10 Cities For Accountants

AccountingWEB, The 10 Best Cities for Accountants:

Sometimes, the grass really is greener elsewhere. LedgerLink, a social and career community for accounting professionals, recently conducted extensive surveys and analysis to determine the very best American cities for accountants, including a calculation of average salaries. They took into account the competitiveness of the accountant market, the availability of accounting jobs, and even lifestyle elements like average commuting time.

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May 17, 2019 in Tax | Permalink | Comments (1)