Paul L. Caron

Thursday, January 15, 2009

Lederman Presents W(h)ither Economic Substance Today at Northwestern

Leandra Lederman (Indiana) presents W(h)ither Economic Substance at Northwestern today as part of its Advanced Topics in Taxation Series organized by Tom Brennan and Charlotte Crane.  Here is a description of the paper:

This article argues that the economic substance doctrine has become distorted. It no longer serves its original purpose, which is to determine whether the taxpayer’s claimed application of the tax law is consistent with Congress’s intent. The article examines the doctrine both historically and as currently applied, critiquing both the business purpose and economic substance prongs of the current doctrine. In part, it argues that the question of whether a transaction is a "tax shelter" is not a fruitful inquiry. Instead, the article advocates a return to the approach used by the Supreme Court in cases such as Gregory v. Helvering, which focused on ascertaining Congressional intent.

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Rather amazing that a tax professor cannot even tell the difference between general substance over form principles and the economic substance doctrine. In the deep trenches of federal tax litigation, the distinction is recognized.

Posted by: Jake | Jan 17, 2009 4:44:16 PM