Paul L. Caron

Thursday, July 31, 2008

Yin: Temporary-Effect Legislation, Political Accountability, and Fiscal Restraint

George K. Yin (Virginia) has posted Temporary-Effect Legislation, Political Accountability, and Fiscal Restraint on SSRN.  Here is the abstract:

The proper duration of legislation has become highly controversial as a result of the enactment of many temporary tax laws during the George W. Bush Administration. The prevailing view is that inclusion of an expiration date or "sunset" feature in legislation permits the cost of the legislation to be misrepresented and allows its proponents to escape the discipline intended by the Congressional budget process. Under this view, fiscal discipline is preserved through enactment of so-called "permanent" legislation, which is accounted for correctly.

This article challenges that view and shows that, barring estimation error, legislation with a sunset feature, which is referred to generally as "temporary-effect" legislation in the article, is accounted for accurately in the legislative process, whereas permanent legislation is not. Consequently, enactment of temporary-effect rather than permanent legislation would increase political accountability and may result in greater fiscal restraint. In addition, when temporary-effect legislation expires, the cost of any extension is fully taken into account in the legislative process. The cost, therefore, competes with, and potentially crowds out, the cost of other legislation. By contrast, the cost of continuing a permanent program disappears in the legislative process and therefore produces little or no crowding-out effect. These features of the legislative process may help to explain why discretionary spending programs, which are generally enacted as temporary-effect legislation, have grown much more slowly than either mandatory entitlement programs or tax expenditures, both of which are generally enacted as permanent legislation.

The article also addresses a number of other issues raised by a preference in favor of temporary-effect legislation. Among other things, the discussion questions the validity of common perceptions that an increase in temporary-effect legislation would (1) lead to more spending increases and tax cuts, (2) be unnecessary so long as other budget-control tools, including a rule known as "pay-as-you-go" or "PAYGO," are tightly enforced, (3) increase legislative transaction costs such as campaign contributions and lobbying costs, and (4) have a detrimental effect on long-term investment incentives. The topic of the article is timely as Congress will soon have to decide the duration of spending and tax initiatives of the new Administration as well as many expiring tax laws

July 31, 2008 in Scholarship | Permalink | Comments (0) | TrackBack (1)

Super-Rich Tax Cheats

See here.

July 31, 2008 in News | Permalink | Comments (1) | TrackBack (0)

Kornhauser: Remembering the "Forgotten Man" (and Woman): Hidden Taxes and the 1936 Election

Marjorie E. Kornhauser (Arizona State) has posted Remembering the "Forgotten Man" (and Woman): Hidden Taxes and the 1936 Election on SSRN.  Here is the abstract:

Hidden (indirect) taxes were a major theme in the Republican Party's attempt to defeat Roosevelt in the 1936 presidential election. Republicans argued that New Deal programs were not free, but rather, were funded by the very people they were supposed to help - the common or "forgotten" men and women--who paid in the form of increasingly heavy hidden taxes on everything from bread to electricity. By stressing the issue of hidden taxes, Republicans hoped to reveal Roosevelt's hypocrisy, raise the average voter's "tax consciousness," and thereby undermine support for Roosevelt. Once sensitized to taxes, the masses would - Republicans believed - vote for Landon because he would provide the necessary relief and economic stimulants in a less costly manner and would reform the tax system to rely more on direct taxes such as the income tax.

Continue reading

July 31, 2008 in Scholarship | Permalink | Comments (0) | TrackBack (0)

CB&PP: Income Concentration at Highest Level Since 1928

The Center on Budget and Policy Priorities has released Average Income in 2006 Up $60,000 For Top 1% of Households, Just $430 For Bottom 90%; Income Concentration at Highest Level Since 1928, by Chye-Ching Huang & Chad Stone:

The shares of the nation's income flowing to the top 1% and top 0.1% of households were higher in 2006 than in any year since 1928, according to an analysis of newly released IRS data by economists Thomas Piketty and Emmanuel Saez. Average pre-tax incomes in 2006 jumped by about $60,000 (5.8%) for the top 1% of households, but just $430 (1.4%) for the bottom 90%, after adjusting for inflation.


July 31, 2008 in Think Tank Reports | Permalink | Comments (1) | TrackBack (0)

State Taxation of Cosmetic Surgery

Tax_analystsJ. Carolina Chavez (J.D. 2008, George Washington) has published An Exploration of "Vanity Taxes" as a Method of Increasing State Revenue, 49 State Tax Notes 255 (July 28, 2008).  Here is part of the Introduction:

Last year, Americans spent over $13 billion on cosmetic procedures, both surgical and nonsurgical, ranging from liposuction to breast augmentation. ...  Not surprisingly, the vanity industry has caught the eye of politicians across the nation who hope to find new sources of revenue for struggling social programs. That proposed cousin to the sin taxes, which states impose on alcohol, cigarettes, and gambling, is in essence an expansion of the sales tax to cover what has been traditionally considered part of the service industry. As with past attempts to tax professional services, many questions arise when considering the taxation of cosmetic surgeries: What constitutes a cosmetic procedure? Does a tax on those procedures discriminate against women? Is it regressive? Is it a form of social legislating?

This article first reviews the history of the sales tax and the unsuccessful attempts to extend it to services. Next it looks at the social implications of taxing cosmetic services, specifically the possible discriminatory repercussions of imposing that tax. Finally, it looks at whether that potentially regressive tax meets the goals of the legislators who seek to levy it. Despite the seeming benefits of taxing what some would consider a luxury, this report concludes that the policy costs of taxing cosmetic procedures greatly outweigh their minimal financial benefits.

July 31, 2008 in Scholarship, Tax Analysts | Permalink | Comments (2) | TrackBack (0)

Senate Holds Hearing Today on Health Benefits in the Tax Code: The Right Incentives

The Senate Finance Committee holds a hearing today on Health Benefits in the Tax Code: The Right Incentives.  These are the witnesses scheduled to testify:

  • Edward Kleinbard (Chief of Staff, Joint Committee on Taxation)
  • Jonathan Gruber (Associate Head, Department of Economics, MIT)
  • Katherine Baicker (Professor of Health Economics, Harvard School of Public Health)

In connection with the hearing, the Joint Committee on Taxation has released Tax Expenditures For Health Care (JCX-66-08).  The hearing takes place at 10:00 a.m. in 215 Dirksen Senate Office Building.

July 31, 2008 in Congressional News | Permalink | Comments (0) | TrackBack (0)

Should We Elect a President Who Cannot Use a Computer?

Wall Street Journal:  Note to Next President: Avoid Computers, by Lee Gomes:

Should a president -- of the United States, or even of a company, for that matter -- use a computer? Or, are there jobs that are too important for the office holder to be spending the day deleting spam or closing pop-up windows in a browser?

The two presidential candidates this year, in addition to all their other, more-significant differences, also present two contrasting perspectives about the extent to which personal-computer technology can be integrated into someone's everyday life.

Sen. Barack Obama lives the life of every modern road warrior, checking a BlackBerry as easily as he checks his wristwatch, and decompressing in his downtime with an iPod. ...

Sen. John McCain, by contrast, represents the last generation that will be able to claim imperviousness to the machines. ...

It's a fair question to ask: Can someone who never touches a computer truly be in touch with what is happening in the world? ...

If I were the chief of staff at the White House, I would have some sort of computer, not in the Oval Office itself, since it wouldn't match the furniture, but one office away. I'd push the president to spend, say, 20 minutes a day on the machine -- whether he would complain about the limit or about the mandated time. ...

With the world at his beck and call, a president is one of the few people lucky enough to be able to learn more off-line than he would chained to a keyboard. The 20-minute limit would be good for the country. The rest of us are stuck reading emails. ...

July 31, 2008 in News | Permalink | Comments (0) | TrackBack (0)

CB&PP: States Should Opt Out of Domestic Production Deduction Corporate Tax Break

The Center on Budget & Policy Priorities has published States Can Opt Out of the Costly and Ineffective “Domestic Production Deduction” Corporate Tax Break, by Jason Levitis, Nicholas Johnson & Katherine Lira:

With many states facing budget problems due to the weak economy, they can ill afford any unjustified revenue losses. But, 27 states are losing hundreds of millions of dollars in revenue due to a federal corporate tax break known as the "domestic production deduction," which mainly benefits large, profitable, corporations. Twenty other states have disallowed the deduction, including two in 2008.


July 31, 2008 in Think Tank Reports | Permalink | Comments (0) | TrackBack (0)

Wednesday, July 30, 2008

The Secret of Obama's Success? He Doesn't Dress Like a "50-Year Old Tax Lawyer"

Associated Press:  The Candidates' Closets: No WIndsurfing Gear, by Samantha Critchell:

[I]n his clothing, as in his campaign, Obama could face the charge of elitism for choosing stylish, slim-cut suits with a European look, [Tyler] Thoreson [executive editor of] says. Thoreson admires the style, which he says shows off Obama's tall, athletic build.

"It shows he's not trying to be like everyone else. It's part of the visual message that he's crafting. In an odd little way, it adds to the authenticity — he's not pandering in a conservative, middle-America suit like a 50-year-old tax lawyer wears," he says.

Ouch.  (Hat Tip: Ted Afield.)

July 30, 2008 in Political News | Permalink | Comments (2) | TrackBack (0)

President Bush Signs Housing Tax Relief Bill

President Bush today signed the housing stimulus bill (H.R. 3221, The Housing and Economic Recovery Act of 2008). The House had approved the bill 272-152 and the Senate 72-13.

There are four main tax cuts in the $15.1 billion tax package:

  • Refundable tax credit for first time home buyers (10% of the purchase price, up to a $7,500 credit)
  • Additional standard deduction for real property taxes for non-itemizers ($500 single/$1,000 joint)
  • Expansion of Gulf Opportunity Zone incentives
  • Temporary increase in the low-income housing tax credit

The major tax increases in the package are:

  • Information returns for merchant payment card reimbursements
  • Delay implementation of worldwide allocation of interest until 2011
  • Modification of the § 121 exclusion of gain on sale of a principal residence

For further explanation of these tax provisions, see:

Press and blogosphere coverage:

July 30, 2008 in Congressional News, News | Permalink | Comments (1) | TrackBack (1)

Law School Class of 2007: A More Extreme Bi-Modal Salary Distribution

I previously blogged (here and here) Bill Henderson's posts (here and here) on the the bi-modal salary distribution pattern among newly-minted lawyers with salary data from the law school classes of 1991, 1996, 2000, and 2006.  Today, Bill reports, based on new NALP data, that the bi-modal salary distribution pattern is even more extreme with the Class of 2007:


Bill notes:

The sample is based on 23,337 law school graduates from the class of 2007 who reported salary information. Note, however, that 197 ABA-Accredited law schools graduated 43,518 students in 2007. ... The median salary in the above distribution is $65,750; the mean is $86,396. ...

On the normative front, I have a simple thesis: the bi-modal distribution is bad for students, bad for law firms, bad for clients, and bad for law schools. [When I showed the 2007 distribution to one law school dean, she shielded her eyes!]:

July 30, 2008 in Law School | Permalink | Comments (0) | TrackBack (0)

WSJ: McCain's Tax Blunder

Editorial in today's Wall Street Journal, McCain's Tax Blunder:

One of the miracles of this Presidential election campaign is that John McCain still has a chance to win, notwithstanding his best attempts to kick it away. In his latest random policy improvisation, the Arizona Senator tried to give up the tax issue.

On ABC's "This Week" Sunday, ... host George Stephanopoulos ... pressed, "So that means payroll tax increases are on the table, as well?" Here came the words that have caused the McCain campaign well deserved grief: "There is nothing that's off the table. I have my positions, and I'll articulate them. But nothing's off the table."

So given a chance to reiterate his opposition to tax increases -- and underscore a main contrast with his opponent -- Mr. McCain punted. Democrats were quick to pounce, with the Democratic National Committee issuing a press release headlined, "McCain Tax Pledge? Not so much." It provided citations of the presumptive GOP nominee asserting that "Senator Obama will raise your taxes. I won't." Expect the "nothing's off the table" line to show up in Democratic TV spots this fall. ...

If Mr. McCain can't convince voters that he's better on taxes than is a Democrat who says matter-of-factly that he wants to raise taxes, the Republican is going to lose in a rout.

July 30, 2008 in Political News | Permalink | Comments (0) | TrackBack (0)

Bowman: Why Junior Law Faculty Are Better

Gregory W. Bowman (Mississippi College School of Law) has published The Comparative and Absolute Advantages of Junior Law Faculty: Implications for Teaching and the Future of American Law Schools, 2008 BYU Educ. & L.J. 171.  Here is the abstract:

In the ongoing debate about how to improve law school teaching, there is a general consensus that law schools should do more to train junior faculty members how to teach. While this may be the case, this consensus inadvertently leads to an implicit assumption that is not true -- that in all facets of law teaching, junior faculty are at a disadvantage compared to senior faculty. In fact, there are aspects of law teaching for which junior faculty can be better suited than their senior colleagues. This Article reviews scholarship concerning law teaching and identifies three teaching factors that generally favor junior law faculty: generational proximity to the law school student body; recency of law practice experience as junior practitioners; and lower susceptibility to the problem of conceptual condensation - extreme depth of subject matter knowledge that makes it difficult to see subjects from the students' perspective.

Continue reading

July 30, 2008 in Scholarship, Teaching | Permalink | Comments (0) | TrackBack (0)

Caron Presents The Story of Murphy: A New Front in the War on the Income Tax Today at Cincinnati

I am presenting The Story of Murphy:  A New Front in the War on the Income Tax at Cincinnati today as part of our 12th Annual Summer Scholarship Series:

This paper is a draft of a chapter from the forthcoming second edition of Tax Stories (Foundation Press), a book designed for use as supplemental reading in the basic federal income tax course. The other ten chapters in the book focus on ten seminal U.S. Supreme Court federal income tax cases. This chapter unpacks the D.C. Circuit’s stunning decision in Murphy v. United States, 460 F.3d 79 (D.C. Cir. 2006), which unsettled more than a half-century of tax jurisprudence in holding, based on an originalist view of the Sixteenth Amendment, that a personal injury award for emotional and reputational injuries could not be constitutionally treated as income. The chapter explores the background of the case, examines the parties’ conduct of the litigation, and critically analyzes the flaws and negative implications of the panel’s opinion. Although the D.C. Circuit panel ultimately granted rehearing and reversed its earlier decision in Murphy v. IRS, 493 F.3d 170 (D.C. Cir. 2007), the panel could not unring the bell and undo the lasting damage to the tax system caused by its original opinion.

Here is the Conclusion:

In his chapter on The Story of INDOPCO, Joseph Bankman argues that the income tax often asks too much of judges (and taxpayers, tax accountants, tax lawyers, and the IRS), demanding Solomonic judgments that mere mortals are incapable of consistently getting right. As a result, what initially may appear as an isolated failure instead may be a systemic flaw in the income tax itself. In Murphy, however, the income tax asked very little of the D.C. Circuit: the case merely required understanding of the constitutional source of Congress’s taxing power; the relationship between constitutional and statutory definitions of income; the meaning of tax basis and the difference between financial capital and human capital; and the courts’ duty to the tax system. Instead, the D.C. Circuit turned what should have been a run of the mill tax dispute over the application of § 104(a)(2) into a threat to the very survival of the income tax. The D.C. Circuit, prodded by the tax blogosphere, ultimately backed away from the brink, but the panel’s willingness to arm the anti-tax brigades should give pause to those committed to defend the income tax. Although questions about the taxation of damage recoveries will not bring down the income tax, the willingness of so many to shake its foundations may ultimately prove its undoing.

July 30, 2008 in Colloquia | Permalink | Comments (2) | TrackBack (0)

Johnson: Casualty and Business Losses When Basis Hasn't Been Lost

Tax_analysts_2Calvin H. Johnson (Texas) has published Casualty and Business Losses When Basis Hasn't Been Lost, 120 Tax Notes 357 (7/28/08):

The proposal is made as a part of the Shelf Project, a collaboration by tax professionals to develop and perfect proposals to help Congress when it needs to raise revenue. Shelf Project proposals are intended to raise revenue, defend the tax base, follow the money, and improve the rationality and efficiency of the tax system. The tax community can propose, follow, or edit proposals at  ... 

This proposal would deny a business or casualty loss deduction for basis to the extent of the fair market value of the property held by the taxpayer after the casualty or loss event. To the extent property still has value, basis has not been lost. The proposal would have no effect on sales, total losses, or properties like cars and machinery that do not appreciate. The proposal is part of a series of proposals under a grand norm that adjusted basis needs to describe the investment value of an asset.

July 30, 2008 in Scholarship, Tax Analysts | Permalink | Comments (0) | TrackBack (0)

1.6m Businesses Owe IRS $58b of Employment Taxes

Service Allocates Merger Costs Between Curently Deductible v. Capitalized Costs

In Priv. Ltr. Rul. 2008-30-009 (4/11/08), released 7/25/08, the IRS allocated the transaction costs incurred in connection with a merger between currently deductible and capitalized expenses.

July 30, 2008 in IRS News | Permalink | Comments (0) | TrackBack (0)

Tuesday, July 29, 2008

ABA Tax Section Offers Teleconference & Webcast Today on Using State Law LLCs as S Corps

The ABA Tax Section offers a teleconference and webcast today on Using State Law Limited Liability Companies as S Corporations from 1:00 - 2:30 p.m. EST:

Although LLCs have gained increasing popularity over the last decade, the number of entities taxed as S corporations still exceeds the number of entities taxed as partnerships for federal tax purposes, and it is projected that S corporations will continue to grow at a faster rate than partnerships.

In those situations in which S corporations are the choice of entity for federal tax purposes, it still may be preferable for a number of non-tax reasons to operate for state law purposes as an LLC. Since the issuance of the “Check the Box Regulations” in 1997, eligible entities (including LLCs) have been able to select their classification for federal tax purposes. Consequently, practitioners have the ability to select the best combination of state law attributes and federal tax treatment to achieve an entity structure specifically tailored for the particular needs of the business.

Please join our distinguished panel as they discuss the tax advantages of operating as an S corporation rather than as a partnership for federal tax purposes, the non-tax advantages of operating as an LLC for state law purposes, as well as other special tax considerations that apply to the operation of a state law LLC as an S corporation for federal tax purposes.


  • Ronald A. Levitt (Sirote & Permutt, Birmingham, AL)
  • Stephen R. Looney (Dean, Mead, Egerton, Bloodworth, Capouano & Bozarth, Orlando, FL)

July 29, 2008 in ABA Tax Section, Tax Conferences | Permalink | Comments (0) | TrackBack (0)

Tax Analysts Partners With TaxProf Blog

Tax_analystsI am thrilled to announce that Tax Analysts has agreed to share some of its content with readers of TaxProf Blog. Each week, I will blog one article from three of Tax Analysts' publications: Tax Notes, State Tax Notes, and Tax Notes International. The full-text of each article will remain available on TaxProf Blog for one week after the post.

I hope this new service will be of interest to the tax community.

July 29, 2008 in About This Blog, Tax Analysts | Permalink | Comments (2) | TrackBack (1)

Tax Prof Steve Willis Applies to Fill Florida Supreme Court Vacancy

Willis_2Tax Prof Steven J. Willis (Florida) is one of the fifty candidates who have applied to fill two upcoming vacancies on the Florida Supreme Court.  Steve joined the Florida faculty in 1981, having previously taught at NYU. He earned his B.A. (1974) and J.D. (1977) from LSU, and his tax LL.M. (1979) from NYU. He is the co-author of one of our books in the LexisNexis Graduate Tax Series, Federal Tax Accounting (2006) (with Michael Lang (Chapman) & Elliot Manning (Miami)).

Two other law professors have tossed their hats in the ring:  Vicki M. Dearing (Florida Coastal) and Stephen M. Durden (Florida Coastal). 

July 29, 2008 in Tax Profs | Permalink | Comments (1) | TrackBack (0)

KPMG Releases Study of Tax Costs in 35 International Cities

KPMG has released Competitive Alternatives 2008 Special Report: Focus on Tax, a detailed study of the tax costs in thrity-five large cities (populations greater than 2 million) in ten countries.  Here are the ten cities with the lowest tax costs:

  1. San Juan, U.S. (46.6)
  2. Puebla, MX (69.7)
  3. Guadalajara, MX (73.6)
  4. Vancouver, CA (75.2)
  5. Monterrey, MX (75.4)
  6. Montreal, CA (83.2)
  7. Toronto, CA (85.4)
  8. Baltimore, US (92.1)
  9. Atlanta, US (95.1)
  10. Melbourne, AU (95.3)

The most expensive city is Paris (190.7).  Other U.S. cities are:

  • Tampa (#11)
  • Detroit (#12)
  • Phoenix (#13)
  • Minneapolis (#15)
  • Washington (#16)
  • Denver (#17)
  • Philadelphia (#18)
  • Boston (#19)
  • Dallas (#20)
  • Houston (#21)
  • Portland (#22)
  • Los Angeles (#23)
  • Chicagi (#24)
  • Seattle (#27)
  • San Diego (#28)
  • New York (#29)
  • San Jose (#30)

July 29, 2008 in News | Permalink | Comments (0) | TrackBack (0)

Henderson: How Most Law Firms Misapply the "Cravath System"

I previously blogged Bill Henerson's powerful post, How the "Cravath System" Created the Bi-Modal Distribution, which traces the history of the bi-modal salary distribution pattern among newly-minted lawyers with salary data from the law school classes of 1991, 1996, 2000, and 2006.  Bill today published Part II: How Most Law Firms Misapply the "Cravath System":

Developing Human Assets.  Under the Cravath System, the inputs themselves (i.e., qualified associates) had little value to clients. Rather, they needed to be trained by the investment of intensive training. Over a period of years, that investment created the remarkable efficiencies and superb quality that bonded clients to the firm. The Cravath system was build upon an incentive structure that encouraged young lawyers to acquires skills at an optimal pace. Further, the firm was intent on inculcating its superior work habits. ...

Sustainability.  The genius of the Cravath system was the interlocking incentives that made the model sustainable: every person involved in the process -- associates, partners, clients --was made better off. ...

Interlocking Incentives for Partners. It is noteworthy that the Cravath system reflected a business philosophy that encompassed the entire firm, including the partnership. ...

Conclusion. ...  In a future post, I will discuss how the logic of the Cravath system mirrors the findings of the famous Bell Labs study, which documented that organizational productivity was a function of teachable work strategies rather than the credentials or innate abilities of individual engineers. Further, under the Bell Labs system, women and minority engineers tended to post the largest gains--a finding that should give the legal profession pause.  See Are We Selling Results or Résumés?: The Underexplored Linkage between Human Resource Strategies and Firm-Specific Capital

July 29, 2008 in Law School | Permalink | Comments (0) | TrackBack (0)

Borchard Foundation Offers Four $20,000 Research Grants

The Borchard Foundation Center on Law and Aging is offering four $20,000 grants to fund "research and scholarship about new or improved public policies, laws, and/or programs that will enhance the quality of life for the elderly, including those who are poor or otherwise isolated by lack of education, language, culture, disability, or other barriers."  The application deadline is September 30, 2008, with selections made by December 15, 2008. For a list of prior grant recipients, see here. For further information, email the Assistant Director here.

July 29, 2008 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Update on Alleged Tax Fraud by GE Subsidiary in Brazil

Following up on my prior posts (here and here) on David Cay Johnston's investigation into possible tax fraud by GE in Brazil for Tax Notes International:    Former GE Attorney Koeck Says She Was Fired for Reporting Fraud, 22 Corp. Crime Rep. 31 (7/28/08):

Adriana Koeck says she was fired from General Electric for reporting fraud to her superiors. That’s according to her Sarbanes Oxley (SOX) whistleblower complaint filed with the Department of Labor, a copy of which was obtained today by Corporate Crime Reporter. Koeck is being sued by GE in federal court in Alexandria, Virginia for taking confidential and privileged information from GE and feeding it to former New York Times reporter David Cay Johnston, among others.

Corporate Crime Reporter has learned that the information was also given to the Department of Justice Fraud Section, which is conducting an initial review of the case.

July 29, 2008 in News | Permalink | Comments (0) | TrackBack (0)

Burke: Is the Corporate Tax Broken?

Karen C. Burke (San Diego) has posted Is the Corporate Tax System "Broken"? on SSRN.  Here is the abstract:

The slated expiration of the Bush Administration's tax cuts in 2010 highlights the instability of the current 15% rate on dividends and capital gains. Meanwhile, pressure has mounted to reduce U.S. corporate tax rates to improve competitiveness in an increasingly global economy. Much of the 1986 Act reform of the corporate tax -- base-broadening combined with lower rates -- has unraveled, leaving the U.S. with a high statutory corporate tax rate and narrow corporate tax base. Despite renewed interest in base-broadening and loophole-closing, the goal of corporate tax reform remains elusive. Thus far, proponents of corporate tax reform have largely sidestepped the controversial issue of whether the 2003 tax cuts on dividends and capital gains should be made permanent.

This Article proceeds in three parts. The first part discusses the long-term decline in the role of the corporate tax in raising federal revenues and enhancing progressivity. Part two discusses how the Administration's 2003 proposal to eliminate double-level corporate taxation morphed into an unstable legislative compromise based on tax rate parity for dividends and capital gains. Part three considers two contrasting alternative goals reflected in current proposals for reform of business taxation: reduced corporate tax rates and enhanced expensing of new investment. The Article concludes that 1986-style base-broadening and reduced rates would improve competitiveness and limit tax sheltering opportunities, although a political consensus for such reform will be hard to forge and additional sources of revenue may be required to finance significant rate reductions.

July 29, 2008 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Tax Consequences of NYU's "Cash for Class" System

The ABA Journal, Above the Law, and New York Post report on how NYU law students pay their classmates for slots in oversubscribed courses.  NYU does not maintain add/drop lists, so a student seeking to enroll pays a student to drop the course and then immediately adds the course.  Do you think the students who receive payment for dropping courses report the income?

July 29, 2008 in Law School | Permalink | Comments (1) | TrackBack (0)

Tax Court Denies Deduction for Course in Day Trading

The Tax Court yesterday denied a taxpayer's claimed § 212 deduction for the expense of a five-day course in day trading. Serrato v. Commissioner, 131 T.C. No. 3 (7/28/08):

Petitioner spent approximately 6.5 hours a day Monday through Friday reviewing, studying, and executing trades. In order to improve his day trading abilities, petitioner signed up for a 5-day one-on-one course called (the course) that he had read about online. The course was held in Cartersville, Georgia, approximately 750 miles from petitioner’s home in Florida. Petitioner drove by himself to the course. Petitioner stayed at a modest local hotel just off the interstate highway approximately 5 miles from the course location. The course consisted of 5 days of intensive training and instruction taught by Paul Quillen. ...

[Petitioners claimed a § 212 deducted for $6,053.06:]  $5,247 for the course, $416.64 for lodging, $224.10 for round trip travel from petitioner’s home to and from Cartersville, Georgia, where the course was held, $145.32 for food, and $20 for a course book. ... Section 212(1) allows as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year for the production or collection of income. Petitioners argue that the course was necessary in order for petitioner to become a better day trader and to maximize profits and minimize losses on his trading activity.

Section 274(h)(7) provides that no deduction shall be allowed under § 212 for expenses allocable to a convention, seminar, or similar meeting. Petitioners argue that the course is not a convention, seminar, or similar meeting as contemplated by § 274(h)(7). We disagree. ...

Merriam-Webster’s Collegiate Dictionary (9th ed. 1985) defines a seminar as a meeting for giving and discussing information. Over 5 days petitioner received hours of information about day trading in the course taught by Mr. Quillen. In the light of the terms and purpose of § 274(h)(7), we conclude that the course was a seminar, or a similar meeting within the scope of that statute, and therefore the expenses relating to the course cannot be deducted pursuant to § 212(1).

July 29, 2008 in New Cases | Permalink | Comments (4) | TrackBack (0)

Eyal-Cohen: Chief Justice Roger J. Traynor's Tax Philosophy

Mirit Eyal-Cohen (S.J.D. Candidate, UCLA) has published Preventive Tax Policy: Chief Justice Roger J. Traynor's Tax Philosophy, 59 Hastings L.J. 877 (2008). Here is the abstract:

Justice Roger J. Traynor is best known for his judicial innovations in the fields of conflict of laws, product liability, and civil procedure. However, few would trace Traynor's roots to the field of tax law. In the late 1930's Traynor collaborated with Stanley S. Surrey, our nation's foremost authorities on federal tax law, and together they called for a substantial transformation of existing mechanisms for settling tax disputes. At that crucial time in history, high marginal tax rates intensified the friction between taxpayers and the government, boosted litigation and multiplied the number of tax controversies. Traynor and Surrey developed the idea of “preventive tax policy” aimed at preventing controversies from arising, and where they cannot be prevented, reducing the area in which they occur. This paper explores the joint project of these extraordinary men in its historical context and its implementation in Justice Traynor's understanding of tax adjudication. Their proposal serves as proxy for the evolution of tax avoidance in a time when tax acts became complex followed by frequent tax revisions enacted in response to tax evasion. It offers valuable guidance for reducing the complexity and vagueness inherent in our tax system, and for improving the relationship between taxpayers and government. Some of today's most important mechanisms to prevent tax avoidance originated in Traynor & Surrey's proposal, such as private letter.

July 29, 2008 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Monday, July 28, 2008

NLJ: IRS Fight for Access to Tax Work Papers Shifts to Courts of Appeals

In this week's National Law Journal:  IRS Fights for Tax Papers; 1st Circuit Will Hear a Key Work-Product Dispute, by Marcia Coyle:

The business and legal communities, concerned about the erosion of the attorney-client privilege in corporate investigations by federal prosecutors, face another privilege battlefront, one with potentially wide-ranging impact:  attorney work-product demands in tax investigations. While the attorney-client privilege controversy plays out in the halls of the Department of Justice and Congress, the work-product fight is now taking clear shape in the federal courts.

The 1st U.S. Circuit Court of Appeals has set a Sept. 5 date for arguments in the closely watched U.S. v. Textron Inc., No. 07-2631, and the government has filed its notice of appeal to the 11th Circuit in a similar tax case, Regions Financial Corp. v. U.S., No. 2:06-CV-00895 (N.D. Ala. 2008).

In each case, a federal trial judge, relying on the work-product doctrine, rejected the IRS's demand for the company's so-called tax accrual workpapers. Such workpapers are prepared with the assistance of in-house and external counsel and relied upon by independent auditors to determine the accuracy of financial statements.

As in the Textron and Regions cases, those workpapers often contain legal analyses and evaluations of potential litigation risks associated with particular tax transactions.

The two key issues facing the circuits in this controversy are whether the workpapers are protected work product and, if they are, whether that protection is waived when a company shares the workpapers with its auditors.

Prior TaxProf Blog coverage:

July 28, 2008 in News | Permalink | Comments (0) | TrackBack (0)

South Carolina Law Review Launches Peer Review Project

The South Carolina Law Review is launching a Peer Review Pilot Project for its forthcoming Volume 60:

  1. Authors will submit manuscripts ... to the Pilot Program specifically by emailing a cover letter and copy of the author’s manuscript to ... Deadline for submissions to the Pilot Program is October 1, 2008.
  2. We will send all received manuscripts to volunteer peer reviewers for peer review. Each manuscript will be sent to at least one but more typically two anonymous peer reviewers, where each reviewer will have expertise in the area of law addressed by the manuscript. Not only will the author not know the identity of the reviewers, but also the identity of the author will not be disclosed to the reviewers ...
  3. Peer reviewers will provide feedback and recommendations to the editorial staff no later than December 1, 2008. ...
  4. Based on careful consideration of the peer reviewers’ recommendations and the needs of the journal, the South Carolina Law Review editorial staff will choose whether or not to publish each manuscript.

For more information, to submit a manuscript or volunteer to be a peer reviewer, or to take a brief survey on the need for peer review in legal publication, see here.

July 28, 2008 in Law School | Permalink | Comments (0) | TrackBack (0)

Atax Issues Call for Tax Research Fellows

The Australian Taxation Studies Program (Atax), University of New South Wales, Sydney, Australia, is seeking two research fellows for 2009:

In 2009 Atax will offer two Research Fellowships to international academics and professionals keen to further their research in the field of taxation and related disciplines. Each Fellowship is valued at up to A$7,500.

Research Fellows normally spend four weeks working at Atax on a mutually agreed area of research. During their stay, Fellows are involved in the following activities:

  • producing at least one research paper on taxation, preferably in collaboration with Atax academic(s), to be published in a refereed journal with due acknowledgement of the Fellowship;
  • conducting an Atax research seminar for interested members of the broader tax research community; and
  • participating in Atax collegial activities during the period of the Fellowship.

Atax will provide office space and computer equipment at its campus in Sydney, Australia. Fellows will be responsible for organising their own travel and accommodation arrangements. The preferred timing for successful applicants to undertake the Fellowship is August-October 2009, but other times of the year may also be possible.

To apply, send a letter of application indicating the tax area to research under the Fellowship, a current curriculum vitae, and preferred timing to undertake the Fellowship to Associate Professor Binh Tran-Nam, Research Fellowship Convenor, by November 30, 2008. Successful applicants will be notified by December 31, 2008. For more details, and a list of prior research fellows, see here.

July 28, 2008 in Tax Prof Jobs | Permalink | Comments (0) | TrackBack (0)

Kentucky Law School May Not Open For Fall 2008 Classes

Barkley_3I previously blogged the $120 million class action lawsuit filed against the American Justice School of Law, a non-accredited for-profit law school in Paducah, Kentucky.  The ABA Journal and Wall Street Journal Law Blog report today that the school -- renamed Barkley School of Law following settlement of the lawsuit which resulted in the transfer of the school to Laxmaiah Manchikanti, an anesthesiologist specializing in pain medicine -- will cancel its Fall classes if its new $5 million library and the renovation of a classroom building are not soon completed. Contracts for all fifteen faculty have not been renewed. Here's the money quote:

The students said they paid $13,250 a semester for tuition, but there was no toilet paper in the restrooms.

Wikipedia reports that the school is named after Alben W. Barkley, Harry Truman's Vice-President.

July 28, 2008 in Law School | Permalink | Comments (0) | TrackBack (0)

Seto on the Proposed Boycott of the U.S. News Rankings

Theodore P. Seto (Loyola-L.A.), author of the influential article, Understanding the U.S. News Law School Rankings, 60 SMU L. Rev. 493 (2007), shares his thoughts on Case Dean Gary Simson's call to boycott the U.S. News rankings (blogged here, here, and here): 

Writing in the on-line edition of the National Law Journal, Dean Gary Simson of Case Western says the following about U.S. News’ recent announcement of possible changes to its methodology:

This announcement, and the wrench that it threatens to throw into structural changes that have been made to avoid being disadvantaged by a deeply flawed methodology, should cause law school faculties and administrations everywhere to finally say ‘enough’ and that they are done participating in a ranking system that has done substantial harm and little, if any, good to legal education in the United States.

In response, Mr. Robert Morse of U.S. News states;

If a law school refuses to provide U.S. News directly with statistical data from their annual American Bar Association (ABA) accreditation data questionnaire, then U.S. News still can get almost all of that school’s official ABA data from the ABA website. U.S. News would still be able to rank a law school, even if it refused to participate

Mr. Morse’s response is correct, but only with significant caveats.

Continue reading

July 28, 2008 in Law Review Rankings | Permalink | Comments (2) | TrackBack (0)

GE Struggling to Quash Former Times Reporter’s Tax Fraud Story

I previously blogged David Cay Johnston's article in the June 30, 2008 edition of Tax Notes International, Blame It on Rio: GE's Brazilian Headache.  The Corporate Crime Reporter has published a follow-up, GE Alleges Attorney Took Privileged Documents, Fed Them to Reporter, 22 Corp. Crime Rep. 30 (7/24/08):

General Electric has charged a former in-house attorney, Adriana Koeck, with illegally taking privileged and confidential company documents and feeding them to a reporter. The lawsuit was filed last month in federal court in Alexandria, Virginia. ...

GE says that Koeck gave the documents to David Cay Johnston, who until he retired on April 11, was a reporter for the New York Times. He currently is writing for Tax Notes International. Last month, Johnston wrote an article for Tax Notes International about an alleged tax fraud scheme at General Electric’s Brazilian subsidiary. The article – Blame It on Rio: GE’s Brazilian Headache – was picked up by news outlets in Brazil – but has been widely ignored by mainstream media outlets in the United States. Last month, Corporate Crime Reporter ran a story based on Johnston’s reporting. Johnston won’t identify his source for the article.

But Johnston said this week that he is concerned that GE is seeking to muzzle reporters in the United States from writing about his story. “No US news organization, except for the Corporate Crime Reporter, has written about my Tax Notes International article, but Brazilian news organizations have,” Johnston said. “GE has repeatedly tried to muscle me with threats of litigation. And other journalists who have read my piece have told me that GE has threatened litigation against anyone who writes about my article.”

In papers filed in conjunction with the lawsuit against Koeck, GE’s lawyers boast about successfully muscling an unidentified web site into taking down Johnston’s article. “Koeck’s wrongful disclosures to a news reporter led to the publication of a news article containing false, malicious and highly misleading statements about GE,” the lawyers wrote in a motion filed with the court earlier this month. ...  “After GE notified the website that the article was false, misleading, and based on privileged and confidential documents, the site agreed, as an interim measure, to remove the article pending further discussions between GE and the website.”

In fact, Tax Notes International posted the Johnston article on its web site for just a couple of days in late June 2008, and then took it down. But Tax Notes editor in chief David Brunori disputed GE’s claim. “We took it down before GE contacted us,” Brunori said. “Our taking it down didn’t have anything to do with GE. We are 100 [percent] subscription funded. We sometimes put teasers up from some of our better known writers on our free web site saying, in effect – look at us. Now, we have somebody famous writing for us. So, we put the article up for just a couple days – just to draw attention. The article remains in our database for subscribers. It is also available through Lexis.”

So, has GE threatened Tax Notes? “We have been in discussions with GE quite a bit,” Brunori said. “They want us to pull the story. There is no doubt about that. When we think in terms of pulling the story – that means running a retraction. We have pulled stories in the past. But we stand by Johnston’s story. We are not going to pull the story. We are not going to issue a retraction. We think his facts were right. That’s all we care about.” ...

GE alleges that Koeck illegally retained and disclosed privileged and confidential information in violation of a confidentiality agreement she signed when she joined GE....

July 28, 2008 in News, Tax Analysts | Permalink | Comments (0) | TrackBack (0)

Tax Foundation Corrects Obama Tax Myths

The Tax Foundation refutes all eight points of an anti-Obama tax screed that is circulating via the Internet and email:

  • 28% capital gains tax rate on ALL home sales
  • 39.6% tax rate on dividends
  • Restored inheritance tax under Obama (repealed under McCain)
  • New taxes on homes over 2,400 square feet
  • New gas taxes
  • New taxes on natural resource consumption (energy, natural gas, etc.)
  • New taxes on retirement accounts
  • New taxes to pay for socialized medicine

July 28, 2008 in Think Tank Reports | Permalink | Comments (17) | TrackBack (0)

Sunday, July 27, 2008

TaxProf Blog Weekend Roundup

WKRP TaxProf Blog in Cincinnati

Fans of the WKRP in Cincinnati TV show might remember the theme song:

Dave Rifkin (Attorney-Advisor to Tax Court Judge Juan F. Vasquez; Adjunct Professor, Georgetown) welcomed me back from San Diego with this ode:

Baby, if you've ever wondered,
Wondered whatever became of me,
I'm living on the net in Cincinnati,
TaxProf Blog in Cincinnati.

Got kind of tired packing and unpacking,
Town to town and up and down the rankings
Maybe you and me were never meant to be,
But baby click on me once in awhile.

I'm at TaxProf Blog in Cincinnati.

Of course, the obvious question is who is my counterpart on the show -- I voted for Andy Travis or Dr. Johnny Fever; my wife and kids, alas, say its Les Nessman.

WKRP TaxProf Blog in Cincinnati.

July 27, 2008 in About This Blog, Celebrity Tax Lore, Miscellaneous | Permalink | Comments (0) | TrackBack (0)

Top 5 Tax Paper Downloads

Tax Foundation: More Tax Nonsense From McCain

From the Tax Foundation's Tax Policy Blog:

This morning on ABC's This Week with George Stephanopoulos, John McCain was interviewed by Stephanopoulos. And during a discussion on energy, McCain mentions his gas tax holiday proposal as a way to relieve consumers, and then Stephanopoulos steps in.

Stephanopoulos: There's not a single economist in the country that says that will work.

McCain: And there's no economist in the country that knows very well the low-income American who drives the furthest in the oldest automobile that sometimes can't even afford to go to work.

Stephanopoulos: But they (referring to economist) all say that they aren't going to get the benefit. The oil companies, the gas companies are going to absorb in production.

McCain: You know they say that. But one, it didn't happen before. And two, we wouldn't let it happen. We wouldn't let it happen. Americans wouldn't let them absorb that.

Stephanopoulos: How would you prevent that?

McCain: We would make them shamed into it. We of course know how to...American public opinion. And we would penalize them if necessary. But they wouldn't. They would pass it along.

Penalize them if necessary? Does John McCain know what that entails? Does he understand that such a policy is de facto price controls? Of course he doesn't. That's because he doesn't know what he's talking about on this issue. ...

Back to McCain's interview. The question before the gas tax holiday was brought up, there was this exchange:

Stephanopoulos: The majority of Americans think you're going to come in. They look at your tax plans and say you're going to be just like President Bush on the economy. What would you do right now, spending aside, that would be different from what Pres. Bush is doing?

McCain: Well, I would give every family in America a double their exemption for on the child tax, children's tax, dependent tax break from $3,500 to $7,000. I would declare that we will scrub every agency of government, eliminate those that are [not] necessary. I will veto every single pork-barrel bill that comes across my desk and make them famous. I will promise that we will not only keep tax cuts low, but we will have additional incentives for American investment and growth of jobs. And I will set and embark on immediate, an immediate effort to eliminate our dependence on foreign oil. Nuclear power, off-shore drilling, wind, tide, solar, and stop this drain of $700 billion a year from the American economy...(goes on to mention gas tax holiday, see above.)

So McCain brags about how he wants to reduce spending at the same time he tells us that he will double the personal exemption for dependents. ...

Combined with the gas tax holiday, the doubling of the personal exemption for dependents (phased in over next few years) is McCain's worst tax policy proposal. And that's funny, because these are the two that he cites the most in public.

July 27, 2008 in Political News | Permalink | Comments (1) | TrackBack (0)

It Is Time to Oust Marriage From the Tax Code

Wendy Richards (J.D. 2008, Wisconsin) has published Comment, An Analysis of Recent Tax Reforms From a Marital-Bias Perspective: It Is Time to Oust Marriage From the Tax Code, 2008 Wis. L. Rev. 611.  Here is the abstract:

As the American family dynamic continues to change, the tax code should change to reflect current population demographics. The tax treatment of marriage contrasts sharply with the actual role that marriage currently plays in society. The recent tax reforms took steps toward alleviating the burdens created by the marital bias but did little to address the bias itself. Accordingly, fundamental reform is necessary. With so many American families functioning without a marriage certificate, it is time for the tax code to stop classifying families on the basis of marriage.

July 27, 2008 in Scholarship | Permalink | Comments (2) | TrackBack (0)

The Texas Margin Tax

David A. Vanderhider (J.D. 2008, St. Mary's) has published Comment, A Marginal Tax: The New Franchise Tax in Texas, 39 St. Mary's L.J. 615 (2008).  Here is part of the Introduction:

In 2006, therefore, the Texas Legislature adopted the new margin tax, which expands the outdated franchise tax. The margin tax increases the number and kind of entities taxed and, true to its nomenclature, taxes a business's margin, or revenue, instead of mere capital. The controversial nature of the new tax lies in its significant reform. Long-used methods of circumventing the franchise tax, such as business restructuring and asset reallocation, are curtailed by the margin tax. ...

Before analyzing the new margin tax, we must first understand the basic history of business taxation in Texas in order to understand how and why the state legislature has made this latest change. Furthermore, analyzing the differences between the franchise tax and the margin tax will allow greater understanding of the complicated margin tax and help Texas businesses estimate their new tax liability. By examining the policy and substance behind the changes to the franchise tax, and by comparing the margin tax with business taxes of other states, we can further anticipate problems and ponder the possible solutions to this controversial change in Texas tax law. The margin tax is both positive and problematic, and even more changes should and probably will be made before the first returns are filed. More than anything, however, the Texas Legislature and Comptroller for Public Accounts need to clarify terms, simplify instructions, and provide example calculations--in addition to the online margin tax calculations worksheet--in order to reduce the confusion and ambiguity surrounding the tax.

July 27, 2008 in Scholarship | Permalink | Comments (2) | TrackBack (0)

Saturday, July 26, 2008

Senate Passes Housing Tax Relief Bill

The Senate today passed, by a 72-13 vote, the housing stimulus bill (H.R. 3221, The American Housing Rescue & Foreclosure Prevention Act).  The House on Thursday had approved the measure by a 272-152 vote after President Bush earlier in the day dropped his veto threat and urged Republicans to support the bill.  There are four main tax cuts in the $15.1 billion tax package:

  • Refundable tax credit for first time home buyers (10% of the purchase price, up to a $7,500 credit)
  • Additional standard deduction for real property taxes for non-itemizers ($500 single/$1,000 joint)
  • Expansion of Gulf Opportunity Zone incentives
  • Temporary increase in the low-income housing tax credit

The major tax increases in the package are:

  • Information returns for merchant payment card reimbursements
  • Delay implementation of worldwide allocation of interest until 2011
  • Modification of the § 121 exclusion of gain on sale of a principal residence

For further explanation of these tax provisions, see:

For press and blogosphere coverage, see:

July 26, 2008 in Congressional News | Permalink | Comments (1) | TrackBack (1)

Student Notes in ABA Tax Lawyer

Tax Violations

Jarrett Jacinto & James Fitzmaurice have published Tax Violations, 45 Am. Crim. L. Rev. 995 (2008). Here is the Introduction:

This Article outlines the elements, defenses, and sentencing consequences of various criminal tax violations under I.R.C. §§ 7201, 7202, 7203, 7206, and 7212(a). Section II of this Article examines the policies and procedures of IRS investigations, as well as the applicable punishments set forth in the United States Sentencing Guidelines. Section II also addresses the basic elements of and defenses to the following crimes: tax evasion under § 7201, failure to collect tax under § 7202, willful failure to file taxes under § 7203, “tax perjury” and “aiding and assisting” tax fraud under § 7206, and interference with the administration of internal revenue laws under § 7212(a). Finally, Section III details criminal investigations of conspiracy to violate the tax laws under the defraud clause of 18 U.S.C. § 371.

July 26, 2008 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Friday, July 25, 2008

Farewell, San Diego!

Usd_photoThis is a bittersweet day for me, as I leave San Diego after seven weeks to return home to Cincinnati.  This was my fifth summer teaching at the University of San Diego School of Law, and I have had a wonderful time. My thanks to the kind folks at USD for having me back again, and to my 73 Tax I students who worked so hard (and laughed at most of my jokes).   San Diego is truly "America's Finest City" -- the climate and the environment are simply spectacular.  But even more enjoyable has been renewing acquaintances with the many friends we have made over the years here.

July 25, 2008 in Miscellaneous | Permalink | Comments (0) | TrackBack (0)

Prof Randy Pausch Dies at 47

Last fall, I blogged the incredibly moving last lecture of Randy Pausch, a 47-year old computer science professor at Carnegie Mellon University and father of three pre-school children who died today of pancreatic cancer.  See Associated Press and New York Times reports.  If you haven't yet watched the video, I encourage you to do so (or if you have, watch it again today).

July 25, 2008 in Obituaries | Permalink | Comments (0) | TrackBack (0)

Senate Continues Hearing Today on Tax Haven Banks and U. S. Tax Compliance

The Senate Permanent Subcommittee on Investigations continues its hearing today on Tax Haven Banks and U. S. Tax Compliance.  The scheduled witnesses are Steven Greenfield (New York) and Peter S. Lowy (Beverly Hill).

July 25, 2008 in Congressional News | Permalink | Comments (0) | TrackBack (0)

ABA Tax Section Submits Comment Letters

Millar: Jurisdictional Reach of VAT

Rebecca Millar (University of Sydney Law School) has posted Jurisdictional Reach of VAT, in VAT in Africa 175-214 (R. Krever, ed., Pretoria University Law Press 2008), on SSRN.  Here is the abstract:

This paper examines the jurisdictional reach of VATs, as determined through their rules on place of taxation. After opening with an examination of the destination and origin principles, it looks at the way in which VATs predict consumption at the time of supply by using proxies to determine the place of consumption. The paper then examines the structure and legal design of place of taxation rules, comparing and contrasting the way these are dealt with in the two main models of a value added tax: the European VAT and the New Zealand GST. The paper considers imports of goods, supplies of goods, supplies of services, and different approaches to using the reverse charge mechanism for imported services. The second half of the paper then examine the way in which (mainly English speaking) African nations have adopted and/or adapted one or other of the two main models, and considers how the laws of those countries measure up to the ideal of taxing domestic consumption under the destination principle. The paper was originally presented in June 2007 at the "VAT in Africa" conference sponsored and hosted by the African Tax Institute (University of Pretoria) and recently appeared in the book of the same name, published by University of Pretoria Press.

July 25, 2008 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Jenn: The Case for Tax Credits

Brian H. Jenn (Skadden, Washington, D.C.) has published The Case for Tax Credits, 61 Tax Law. 549 (2008).  Here is the Conclusion:

Over the last few decades, Congress has increasingly relied on tax credits as an alternative to deductions and exclusions in the implementation of tax expenditures, particularly those meant to create incentives for certain behaviors. The Earned Income Tax Credit is perhaps the most prominent example, but it is far from the only one. In fact, the Code contains a whole constellation of less significant credits aimed at encouraging individuals to engage in a variety of different behaviors, from adopting children to purchasing alternative fuel vehicles. Nonetheless, the largest tax expenditures affecting the greatest number of people continue to take the form of deductions and exclusions from gross income.

Continue reading

July 25, 2008 in ABA Tax Section, Scholarship | Permalink | Comments (0) | TrackBack (0)