Paul L. Caron

Wednesday, April 30, 2014

Above the Law 2014 Rankings of the Top 50 Law Schools

ATLAbove the Law has released its 2014 Rankings of the Top 50 Law Schools. Here are the Top 25, along with each school's U.S. News ranking:


US News

Law School



















































Notre Dame












Boston College



New Mexico



North Carolina








Employment score (30%)
We are staying out of all of the hairsplitting about the definitions of “J.D. Advantage” versus “J.D. Preferred,” or whether employment data should be captured at 9 or 10 months after graduation. Much of the debate around law school employment data strikes us as so much fiddling around the edges of a larger problem. Thus for the employment score, we only counted full-time, long-term jobs requiring bar passage (excluding solos and school-funded positions).

Quality jobs score (30%)
This measures the schools’ success at placing students on career paths that best enable them to pay off their student debts. We’ve combined placement with the country’s largest and best-paying law firms (using the National Law Journal’s “NLJ 250”) and the percentage of graduates embarking on federal judicial clerkships. These clerkships typically lead to a broader and enhanced range of employment opportunities.

SCOTUS clerk & Federal judgeship scores (7.5% each)
Though obviously applicable to very different stages of legal careers, these two categories represent the pinnacles of the profession. For the purposes of these rankings, we simply looked at a school's graduates as a percentage of (1) all U.S. Supreme Court clerks (since 2009) and (2) currently sitting Article III judges. Both scores are adjusted for the size of the school.

Education cost (15%)
Solid data on individual law student educational debt is hard to come by. Published averages exist, but the crucial number, the amount of non-dischargeable government funded or guaranteed educational loan debt, is not available. So as a proxy for indebtedness, we’ve scored schools based on total cost. For those schools placing a majority of their graduates into the local job market, we’ve adjusted the score for the cost of living in that market.

Alumni rating (10%)
This is the only non-public component of our rankings. Our ATL Insider Survey asks students and alumni to rate their schools in terms of academics, financial aid advising, career services advising, social life, and clinical training. For the purposes of the ATL Top 50, we only counted the alumni ratings, as that was more in keeping with our “outcomes only” approach. 

Four of the five California law schools ranked in the Top 50 by both Above the Law and U.S. News rank lower in the ATL ranking due to its heavy (60%) reliance on placement data and California's comparatively weak legal employment market.


US News

Law School
















Like U.S. News, ATL has not heeded the call by California law school deans to use state-adjusted employment measures.

Update:  Brian Leiter (Chicago), ATL's Approach to Ranking Law Schools: Decide What the Result Should be, Then Adjust the Criteria Accordingly

April 30, 2014 in Law School Rankings, Legal Education | Permalink | Comments (2)

EBay Bucks Trend, Repatriates $9 Billion to U.S. at $3 Billion Tax Cost

Wall Street Journal, EBay to Take $3 Billion Tax Charge Online Marketplace to Bring Overseas Cash Back to U.S.:

EBay (2014)EBay is taking the unusual step of bringing most of its foreign-held cash back to the U.S.—and with it a $3 billion tax bill. ... "We are an acquisitive company and we need to ensure we have the resources available to capitalize on targets that become available," said Bob Swan, the San Jose, Calif., company's chief financial officer. "To be clear, we are not announcing any large U.S.-based acquisition."

EBay said it would bring as much as $9 billion that it had previously designated as permanently invested overseas back to the U.S., meaning it will pay tax on the difference between the U.S. and foreign tax rates. The move appears to be one of the largest repatriations in recent years.

Rather than repatriate foreign earnings and pay the tax, many more companies are borrowing for domestic purposes. Apple on Tuesday said it would sell $12 billion in bonds, just a year after agreeing to a $17 billion bond sale.

"Firms as strong as eBay could go the Apple route and just use foreign cash to service their debt," said Edward Kleinbard, a professor at University of Southern California's Law School and a former chief of staff for Congress's Joint Committee on Taxation. "It's surprising that a company would incur current costs when they could just issue debt."

April 30, 2014 in Tax | Permalink | Comments (1)

Wells & Lowell: Tax Base Erosion and Section 482

Bret Wells (Houston) & Cym Lowell (McDermott Will & Emery, Houston),  Tax Base Erosion: Reformation of Section 482's Arm’s Length Standard, 15 Fla. Tax Rev. 737 (2014):

Florida Tax ReviewThe United States has repeatedly attempted to stop tax base erosion for almost the entire post-World War I era, and yet the same problems exist today. The need for fundamental tax reform is front-page material in the major newspapers with the US transfer pricing rules and US multinationals portrayed as public enemy #1. This year, the OECD issued a report entitled “Addressing Base Erosion and Profit Shifting” and last month it issued a “Action Plan” for how it plans to proceed to address base erosion and profit-shifting. In a competing fashion, several important developing countries have initiated their own pact to develop cooperative strategies on these issues outside of the framework of the OECD and UN. It is fair to say that a solution to the base erosion and profit-shifting practices of multinational corporations is the “holy grail” of international tax policy.

This article proposes a solution to the base erosion and profit-shifting phenomenon in what many believe is an unlikely place: within the arm’s length standard itself.

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April 30, 2014 in Scholarship, Tax | Permalink | Comments (0)

Should Faculty Know Their Colleagues' Salaries?

Business Insider, Here's Why Whole Foods Lets Employees Look Up Each Other's Salaries:

Whole FoodsHave you ever wondered how much money your boss makes? If you worked at Whole Foods, you could look it up and find out.

Leaders of the supermarket chain believe in keeping employees as informed as possible, even when it comes to pay. Under the company's open policy, staff can easily look up anyone's salary or bonus from the previous year — all the way up to the CEO level.

The unusual Whole Foods policy is designed to both encourage conversations about salary among staff members and to promote competition within the company, according to The Decoded Company: Know Your Talent Better Than You Know Your Customers, a new book by entrepreneurs Leerom Segal, Aaron Goldstein, Jay Goldman, and Rahaf Harfoush on innovative management practices. Whole Foods co-CEO John Mackey introduced the policy in 1986, just six years after he co-founded the company. In the book, he explains that his initial goal was to help employees understand why some people were paid more than others. If workers understood what types of performance and achievement earned certain people more money, he figured, perhaps they would be more motivated and successful, too.

(Hat Tip: Greg McNeal.)

April 30, 2014 in Legal Education | Permalink | Comments (7)

Estate Planning Is a Game

The Virtual Law Practice is launching a RocketHub crowdfund campaign to raise funds to build out the estate planning game, Estate Quest:

(Hat Tip: ABA Journal.)

April 30, 2014 in Tax | Permalink | Comments (0)

SSRN Tax Professor Rankings

SSRN LogoSSRN has updated its monthly rankings of 750 American and international law school faculties and 3,000 law professors by (among other things) the number of paper downloads from the SSRN database.  Here is the new list (through April 1, 2014) of the Top 25 U.S. Tax Professors in two of the SSRN categories: all-time downloads and recent downloads (within the past 12 months):



All-Time Downloads


Recent Downloads


Reuven Avi-Yonah (Mich.)


Reuven Avi-Yonah (Mich.)



Paul Caron (Pepperdine)


Paul Caron (Pepperdine)



Louis Kaplow (Harvard)


Richard Ainsworth (BU)



Vic Fleischer (San Diego)


D. Dharmpala (Illinois) 



D. Dharmpala (Illinois)


Ed Kleinbard (USC)



James Hines (Michigan)


Katie Pratt (Loyola-L.A.)



Ted Seto (Loyola-L.A.)


Richard Kaplan (Illinois)



Richard Kaplan (Illinois)


Jen Kowal (Loyola-L.A.)



Katie Pratt (Loyola-L.A.)


Bridget Crawford (Pace)



Dennis Ventry (UC-Davis)


Robert Sitkoff (Harvard)



Carter Bishop (Suffolk)


Louis Kaplow (Harvard)



David Weisbach (Chicago)


Brad Borden (Brooklyn)



Chris Sanchirico (Penn)


James Hines (Michigan)



Jen Kowal (Loyola-L.A.)


Omri Marian (Florida)



David Walker (BU)


Ted Seto (Loyola-L.A.)



Bridget Crawford (Pace)


Vic Flesicher (San Diego)



Brad Borden (Brooklyn)


Dick Harvey (Villanova)



Francine Lipman (UNLV)


Jeff Kwall (Loyola-Chiago)



Robert Sitkoff (Harvard)


Dan Shaviro (NYU)



Richard Ainsworth (BU)


Carter Bishop (Suffolk)



Herwig Schlunk (Vand.)


Susan Morse (Texas)



Ed Kleinbard (USC)


David Weisbach (Chicago)



Dan Shaviro (NYU)


David Gamage (UCBerkeley)



Ed McCaffery (USC)


Chris Sanchirico (Penn)



Wendy Gerzog (Baltimore)


Gregg Polsky (N. Carolina)


Note that this ranking includes full-time tax professors with at least one tax paper on SSRN, and all papers (including non-tax papers) by these tax professors are included in the SSRN data.

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April 30, 2014 in Legal Education, Tax, Tax Prof Rankings | Permalink | Comments (0)

Fleischer: How Tax Laws Distort the Pfizer Deal

Pfizer 2Following up on yesterday's post, Pfizer's Acquisition of AstraZeneca May Spur Rush of Tax-Avoidance Inversions: New York Times DealBook, How Tax Laws Distort the Pfizer Deal, by Victor Fleischer (San Diego):

It’s tempting to look at the Pfizer deal simply as a loss for taxpayers in the United States. But it’s worse than that. A Coasean perspective is useful because it focuses attention on how taxes distort “real” (nonfinancial) management decisions, like how to organize a firm, whether to buy or make major aspects of production, where to locate assets and production functions inside the firm, and how and where to reinvest profits. Because reinvested profits are taxed more lightly than distributed profits, taxes may often have the effect of causing firms to grow larger than is economically efficient.

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April 30, 2014 in Tax | Permalink | Comments (0)

Winchester: Carried Interest for the Common Man

TaxSymposiumHeaderRichard Winchester (Thomas Jefferson), Carried Interest for the Common Man, 142 Tax Notes 1250 (Mar. 17, 2014) (Symposium on Tax Reform in a Time of Crisis):

This article describes how a self employed individual can minimize federal tax on his earnings when he operates his business through a formal business entity. The article also assess the merits of a proposal to address the situation.

April 30, 2014 in Scholarship, Tax, Tax Conferences | Permalink | Comments (0)

Beyond Elitism: Legal Education for the Public Good

George Critchlow (Gonzaga), Beyond Elitism: Legal Education for the Public Good, 45 U. Tol. L. Rev. ___ (2014):

The possibilities for legal education reform are endless once an institution has unshackled itself from elitist traditions, copycat curricula and cultures, and the belief that law schools exist primarily to serve the needs of affluent clients, students who want to be rich, and faculty who want protection from markets and the demands of practice. This article describes the confluence of historical and recent forces that make this a good time to reflect and act on the relationship between legal education and the availability of legal services to the ordinary public. We have an opportunity to reassess the assumptions and costs associated with years of copying an elitist model of legal education – a model that has neglected to train lawyers and other legal services providers to meet society’s substantial unmet legal needs. The article sketches out what a truly innovative, affordable, and public interest-minded law school might look like. It argues for a new definition of education excellence based on the ability of law schools to serve the interests of both students and the underserved public.

New School for Legal Services (NSLS):

Target enrollment for the new school is a total of 360 students, comprised of 300 J.D. students; 20 Legal Technician students, 20 Paralegal students, and 20 Masters students. The annual revenue for law school is $5,400,000. Twelve percent of this ($648,000) is paid to the main university to support the law school’s overhead leaving $4,752,000 for the educational program.

The NSLS faculty and personnel costs consist of:

  • Ten full-time tenure or tenure track professors who are expected to divide their time between teaching and scholarly activity. They are paid an average of $100,000 a year plus benefits that average $25,000 each. The Virtual Library Director is counted among these ten faculty. (Total cost: $1,250,000); 
  • Eight full-time professors on renewable five-year contracts who are not expected to engage in traditional scholarship. Five of these are former practicing lawyers who teach primarily in the classroom and online. Three are former practitioners who teach skills in simulated settings. They are paid an average salary of $100,000 per year plus benefits that average $25,000 each. (Total cost: $1,000,000);
  • Three full-time professors who are experienced lawyers, who have faculty status and renewable contracts, and who are placed in local for-profit and non-profit legal services offices with responsibility for training students how to practice law in the context of representing real clients. These faculty members have no faculty committee or other administrative responsibilities. They are paid an average of $100,000 annually plus $25,000 in benefits. (total cost: $375,000);
  • Ten adjunct professors who teach two classes each year for a total of $10,000/yr. (Total cost $100,000);
  • Total faculty personnel expenses: $2,725,000
  • Total full-time faculty/student ratio: 17/1
  • The Dean’s budget, including the Dean’s salary, travel, and discretionary expenses is $400,000.

April 30, 2014 in Legal Education | Permalink | Comments (4)

The IRS Scandal, Day 356

Tuesday, April 29, 2014

Gamage Presents A Framework for Analyzing the Optimal Choice of Tax Instruments Today at NYU

Gamage (2014)David Gamage (UC-Berkeley) presents A Framework for Analyzing the Optimal Choice of Tax Instruments, 68 Tax L. Rev. ___ (2014), at NYU today as part of its Tax Policy Colloquium Series hosted by Daniel Shaviro and Alan Auerbach:

What mix of policy instruments should governments employ to raise revenues or to promote distribution? The dominant answer to this question in the tax theory and public finance literatures is that (with limited exceptions) governments should rely exclusively on a progressive consumption tax. Thus, among other implications, the dominant view is that governments should not tax capital income or wealth, and that legal rules should not be designed to promote distribution.

In contrast, this Article argues that governments should make use of a number of tax and non-tax policy instruments to raise revenues and to promote distribution. Furthermore, this Article argues that governments may have much greater capacity to raise revenues and to promote distribution at lower efficiency costs than is generally recognized. Whereas the existing theoretical literature focuses on a small number of distortionary costs that result from taxation (in particular, on labor-to-leisure and saving-to-spending distortions), this Article analyzes the implications of taxpayers engaging in a diverse variety of tax-gaming responses. To the extent that taxpayers respond to different tax instruments through different forms of tax gaming, this Article demonstrates that governments can raise revenues and promote distribution more efficiently by employing a variety of different policy instruments.

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April 29, 2014 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Pfizer's Acquisition of AstraZeneca May Spur Rush of Tax-Avoidance Inversions (and Congressional Action)

Bloomberg:  U.S. Treasury Seen Loser in Tax-Avoiding Pfizer Deal, by Jesse Drucker & Zachary R. Mider:

Pfizer 2If Pfizer is successful in its $98.7 billion takeover of London-based AstraZeneca, there is one big potential loser: the U.S. Treasury.

Under the proposed deal’s structure, the combined company would be owned by a new U.K. parent. That doesn’t mean any of New York-based Pfizer’s executives would need to move abroad: Chief Executive Officer Ian Read has said the drugmaker would be run from the U.S. It does mean, however, that Pfizer is joining a wave of U.S. companies using mergers as ways to slash income tax bills by shifting their head office overseas -- often on paper only.

“This is basically an opportunity to go outside the U.S. and still sell in the U.S. and strip the tax base,” said H. David Rosenbloom, an attorney at Caplin & Drysdale in Washington and director of the international tax program at New York University’s school of law. “If we ever had a legislature in the United States, we could do something about this, but I don’t expect to live that long.”

U.S. law seeks to stop companies from avoiding income taxes by simply ditching their home residence. Those rules only prevent companies from getting the tax benefit of an overseas merger if their existing shareholders still own 80 percent or more of the company’s stock after the deal.

In Pfizer’s case, shareholders likely would own less than that proportion of the new combined company.

By switching its parent company from the U.S. to the U.K., Pfizer could take advantage of a number of tax benefits. The U.K. corporate tax rate is 21 percent -- next year dropping to 20 percent -- compared with 35 percent in the U.S. In addition, the U.K. only taxes profits that companies say are earned within the country.

So earnings attributed to subsidiaries in tax havens aren’t then taxed when they are brought home. And the newest benefit: the U.K. is phasing in a 10 percent tax rate on profits attributed to U.K. patents, a big source of income for any drugmaker. ...

Last year, Pfizer reported an effective tax rate of 27 percent.

The U.S. Congress tried to impose a moratorium on such corporate moves overseas -- called inversions -- in 2002. Two years later, it passed legislation designed to limit that practice.

Nevertheless, since 2012, at least 15 large companies have either moved or announced plans to move offshore, including Chiquita Brands International Inc., the Charlotte, North Carolina-based banana importer, and New York-based Omnicom Group Inc., the largest U.S. advertising firm.

(Hat Tip: Bruce Bartlett)

April 29, 2014 in Tax | Permalink | Comments (1)

Bridge to Practice Series™

Sponsored by West Academic

Michael Vitiello  (McGeorge):

BridgeFinding bad news about legal education is easy. And some of the bad news is deeply troubling. No one in legal education can be insensitive to the slowly recovering employment market and to concerns about student debt. But some of the gloom and doom about law schools is just wrong.

In 2011, David Segal wrote a series of articles that appeared on the front page of the New York Times. His articles did not say anything new about legal education. But the appearance of his views on the front page of the Times made Segal’s voice important.

Some of Segal’s criticisms are legitimate. But one aspect of his critique was galling. In one article, after observing that young lawyers have spent over $150,000 for their legal educations, Segal commented, “What that they did not get, for all that time and money, was much practical training.” Segal also contended that the law school curriculum has changed little since the days of Dean Langdell. Segal’s portrayal of legal education was stereotypical and one dimensional.

When I graduated from law school 40 years ago, the statement about limited practical training was true. Even then, law schools were putting in place legal clinics and volunteer programs to give students on-hands experience. To continue to insist that little has changed in the past three decades demonstrates a lack of awareness of what goes on in law schools around the country.

Start with changes in skills based courses like legal writing and moot court. Within the past 25 years, many schools have converted their programs from one or two unit pass-fail courses often taught by upper level students to far more demanding programs. Most schools hire tenure track or long term contract professionals. Many law schools offer rigorous writing programs and train students in oral advocacy skills. That has been the pattern at McGeorge. The directors of our Global Lawyering program have created a nationally recognized writing program. The program spans the first two years and offers students with a wide range of practical skills. For example, during their 2 L year, students argue multiple motions in a “district court” after they have submitted memoranda to the court. Their earlier memoranda culminate in a full appellate brief, submitted and argued individually to an appellate court. Each student argues before a three judge panel. The realistic litigation problem introduces students to international law as well. For example, students may have to argue whether domestic or foreign law applies because the problem presents a conflict of law question.

Skills education goes well beyond clinics, legal writing, trial advocacy, and externship programs. Many professors have integrated skills training into more traditional courses. I offer my own example as someone who came into the academy after three years of experience, mostly as a judicial clerk. Many years ago, I realized the necessity of integrating simulation exercises into my Civil Procedure course. Concepts like personal jurisdiction and summary judgment challenge the best students; students have trouble grasping concepts that lack any intuitive feel. For many years, I pieced together simulation exercises; but I did not provide systematic exposure.

That all changed when my acquisitions editor at West Academic Publishing accepted my proposal to publish a series of simulation books. The books in the Bridge to Practice Series™ are designed to supplement traditional casebooks across the curriculum. Priced reasonably, the paperbacks run between 100 and 200 pages. Each contains a series of simulations with a teacher’s manual detailing how the professor can integrate the simulations into their “podium” courses.

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April 29, 2014 in Book Club, Legal Education | Permalink | Comments (0)

Schumacher: Sentencing in Tax Cases After Booker

Scott A. Schumacher (Washington), Sentencing in Tax Cases after Booker: Striking the Right Balance, 58 Vill. L. Rev. ___ (2014):

It has been nearly ten years since the Supreme Court’s seminal decision in United States v. Booker, in which the Court invalidated the mandatory application of the United States Sentencing Guidelines. In the cases that followed, the Court addressed subsidiary issues regarding the application of the Guidelines and the scope of appellate review. However, despite — or perhaps because of — these opinions, there is little consensus regarding the status and extent of appellate review, as well as the discretion afforded sentencing courts. More troubling, what consensus there is seems to permit judges to impose any sentence they wish, as long as the appropriate sentencing procedures are followed. As a result, we are in danger of returning to “the shameful lack of parity, which the Guidelines sought to remedy.”

The Sentencing Reform Act and the Sentencing Guidelines were designed to reduce disparity in sentencing and to reign in what one commentator described as a “lawless system.” However, the Guidelines as ultimately conceived drastically limited the sentencing judge’s ability to impose a sentence that was appropriate for the conduct and culpability of the defendant, creating a different kind of sentencing disparity. The current, post-Booker system provides more guidance than the pre-Guidelines system, but permits sentencing judges to disregard the Guidelines and develop their own sentencing policy. As a result, rather than having a system that allows for sentences to be tailored to individual defendants, the current system allows sentences to be imposed based on the penal philosophy of individual judges. This will inevitably lead to unwarranted sentencing disparity.

This article traces the recent history of criminal sentencing and, relying on the influential works of John Rawls and H.L.A. Hart on theories of punishment, argues for a better system that allows for both guidance to sentencing judges and appropriately individualized sentencing. My recommendation, although equally applicable to any federal sentence, will be examined through the lens of tax sentencing.

April 29, 2014 in Scholarship, Tax | Permalink | Comments (0)

Leiter's Research University Rankings

Brian Leiter (Chicago), Top Research Universities in the US, 2014:

T]his is an aggregation of reputational surveys done by U.S. News on graduate programs, which tend to give decent, if imperfect, information (based on my conversations with scholars in various fields). The fields included here are from the Social Sciences & Humanities (Economics, English, History, Political Science, Psychology & Sociology, plus Philosophy from the 2011 PGR), the Sciences (Biology, Chemistry, Computer Science, Earth Sciences, Math, Physics, Statistics), Law, and Medicine. Universities received 4 points for each program in the top five; 3 points for each additional program in the top ten; 2 points for each additional program in the top 15; 1 point for each additional program in the top 25; and .5 points for each additional programa in the top 35. ... After each school name is the total number of points, the number of fields in which the school had a "top 25" program (maximum is 16), the number of fields in which the school had a top 35 program (if different), and the number of "top five" programs.

  1. Stanford (63 total, top 25/16 fields, 15 top five programs)
  2. Harvard (59 total, top 25/16 fields, 13 top five programs)
  3. UC-Berkeley (56 total, top 25/15 fields, 12 top five programs)
  4. Princeton (45 total, top 25/13 fields, 8 top five programs)
  5. Yale (43.5 total, top 25/15 fields, top 35/16, 4 top five programs)
  6. Columbia (43 total, top 25/16 fields, 3 top five programs)
  7. Michigan (43 total, top 25/16 fields, 4 top five programs)
  8. Chicago (40.5 total, top 25/15 fields, top 35/16, 5 top five programs)
  9. MIT (37.5 total, top 25/10 fields, top 35/11, 7 top five programs)
  10. UCLA (34.5 total, top 25/15 fields, top 35/16, 1 top five program)

The full list is here.

April 29, 2014 in Law School Rankings, Legal Education | Permalink | Comments (3)

Brown: Lessons From Barack and Michelle Obama’s Tax Returns

TaxSymposiumHeaderDorothy A. Brown (Emory), Lessons From Barack and Michelle Obama’s Tax Returns, 142 Tax Notes 1109 (Mar. 10, 2014) (Symposium on Tax Reform in a Time of Crisis):

President and Mrs. Obama have made their tax returns publicly available going back to tax year 2000. While every year with the release of a new tax return, analysis turns to a particular year’s tax return, this study analyzes their tax returns for the years 2000-2004. The study shows that when you compare the Obamas’ tax return data with published Internal Revenue Service statistics, that for every year but one, the Obamas’ paid higher taxes than their financial peers – perhaps one more piece of evidence that we are not post-racial yet.

April 29, 2014 in Scholarship, Tax, Tax Conferences | Permalink | Comments (4)

WSJ: MLPs and Hedge Funds Are Too Complicated to Be Audited

Following up on my previous posts:

Wall Street Journal:  Investments That Elude IRS Scrutiny: Master Limited Partnerships and Hedge Funds Are Often Too Complicated to Be Audited, by Laura Saunders:

Is your investment too complicated to be audited?

It could be, say experts, if it is a partnership stake in a large private-equity firm, hedge fund or master limited partnership. Examples include publicly traded partnerships such as Blackstone Group and KKR, oil and gas MLPs such as Magellan Midstream Partners or Kinder Morgan Energy Partners, and many privately held large partnerships as well.

The IRS reviewed the books and records of only 0.8% of large partnerships with 100 or more direct investors and $100 million or more in assets in fiscal 2012, according to recent findings from the Government Accountability Office, a federal watchdog agency. By contrast, the IRS audited 27.1% of corporations with $100 million or more in assets in the same year.

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April 29, 2014 in Tax | Permalink | Comments (0)

Herzig: Marriage Pluralism: Taxing Marriage after Windsor

David Herzig (Valparaiso), Marriage Pluralism: Taxing Marriage after Windsor:

The purpose of the tax law is to collect as much revenue in as neutral manner as possible. When the current Code was enacted in 1913 and it was determined that the appropriate taxable unit was the family, a series of patchwork solutions were required to bridge the gap in between the civil and community property law regimes. Those solutions were not based on any fundamental principle of taxation, but, rather, dealing with the binary approach to marriage at that time. As the number of pluralistic approaches to family arrangements increased, the U.S. Department of the Treasury (“Treasury”) did not continue to examine the implications of those relationships. It was not until after U.S. v. Windsor, when the Court decided that the federal definition of marriage in Section 3 of the Defense of Marriage Act (“DOMA”) was unconstitutional, that Treasury was faced with addressing, at the minimum, the state law differential in what it means to be married. As a formal matter, words like “marriage” or “spouse” do appear to require Treasury to investigate the law of a particular state. Treasury had to determine which state’s definition of marriage applies for federal tax purposes: the state where the couple married (state of ceremony) or the state where the couple resides (state of domicile). As a result of the state level distinctions, Treasury issued Revenue Rule 2013-17, in which Treasury (and thus the IRS) stated that, for federal tax purposes, same-sex couples legally married in jurisdictions that recognize their marriages will be treated as married regardless of whether the state of domicile recognizes that marriage.

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April 29, 2014 in Scholarship, Tax | Permalink | Comments (2)

Prebble: Legal Writing and Tax

John Prebble (Victoria University of Wellington), Organisation and Composition of Legal Prose:

This paper provides guidance on legal writing. There is advice on sentences and punctuation, words and spelling, style, and references. A series of writing examples are used to outline common mistakes and errors. Most examples relate to tax law, but the paper applies to legal writing in general.

April 29, 2014 in Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 355

Monday, April 28, 2014

Hickman Delivers Chair Investiture Lecture Today at Minnesota on Administering the Tax System We Have

Hickman 2014 2Kristin E. Hickman (Minnesota) delivers a lecture today on Administering the Tax System We Have, 64 Duke L.J. ___ (2014), as part of her investiture as the Harlan Albert Rogers Professor of Law at Minnesota:

Traditional perceptions of tax exceptionalism from administrative law doctrines and requirements have been predicated at least in part on the importance of the tax code’s revenue raising function. Yet, Congress increasingly relies on the IRS to administer government programs that have little to do with raising revenue and much more to do with distributing government benefits to the economically disadvantaged, subsidizing approved activities, and regulating outright certain economic sectors like nonprofits, pensions, and now health care. As the attentions of the Treasury Department and Internal Revenue Service shift away from raising revenue and toward these other matters, the revenue-based justification for tax exceptionalism from general administrative law norms fades. To demonstrate the shift, the Article incorporates empirical analysis of Treasury and IRS regulatory activity over time.

April 28, 2014 in Scholarship, Tax | Permalink | Comments (0)

Mazur: Taxing the Cloud

Orly Mazur (SMU), Taxing the Cloud (Recipient, 2013 David F. Bradford Memorial Prize for Best Paper in Taxation):

Transacting business in the “cloud” has quickly gained popularity worldwide as the new method of providing information technology resources. Instead of purchasing or downloading software, we can now use the Internet to access software and other fundamental computing resources located on remote computer networks operated by third parties. These transactions offer companies lower operating costs, increased scalability and improved reliability, but also give rise to a host of international tax issues. Despite the rapid growth and prevalent use of cloud computing, U.S. taxation of international cloud computing transactions has yet to receive significant scholarly attention. This Article seeks to fill that void by analyzing the U.S. tax implications of operating in the cloud from a doctrinal and policy perspective. Such an analysis shows that the technological advances associated with the cloud put pressure on traditional U.S. federal income tax principles, which creates uncertainty, compliance burdens and liability risks for companies and a potential loss of revenue for the government. Applying the current law to cloud computing transactions also results in tax consequences that run counter to sound tax policy and may result in double taxation or complete non-taxation of cloud income. In light of these problems, federal attention is warranted to clarify how U.S. federal income tax principles apply to businesses operating in the cloud. Thus, this Article proposes that Treasury issue guidance that clearly addresses the U.S. tax implications of international cloud computing services and suggests that, ultimately, the United States must collaborate with other countries to achieve international consensus on these issues. Together these changes will ensure that the United States appropriately taxes the cloud and does so in a manner that minimizes double taxation and promotes efficiency, equity and administrative simplicity.

April 28, 2014 in Scholarship, Tax | Permalink | Comments (0)

NLJ: At Law Schools, Need for Reform is Obvious, the Means Less So

National Law Journal:  At Law Schools, Need for Reform is Obvious, the Means Less So, by Karen Sloan:

Future 2Colorado Law’s Silicon Flatirons Center, which focuses on technology and entrepreneurship in the law, convened a daylong conference on April 17 [The Future of Law School Innovation] aimed at helping identify how law schools can successfully innovate.

The widely held view is that innovation in legal education is hampered by aversion to change both within the legal profession as a whole and by entrenched faculties. But declining enrollment and related pressures have given schools no choice but to embrace change.

Colorado professor Scott Peppet observed that legal educators become obsessed with the causes of the problems they face—and less so about finding solutions.

But some law schools and professors deserve credit for innovation, said Bill Henderson, a professor at Indiana University Maurer School of Law–Bloomington. For instance, he said, Washington and Lee University School of Law in 2008 eliminated the traditional third-year curriculum and adopted a practice-oriented program.

But reform efforts and success are two different things, Henderson said. “It’s one thing to have a theory and get some good press clippings,” he said. “It’s another thing to get it to work. The biggest hurdle, I think, is students. It’s hard to get this stuff to work [with students].”

Rather than trying to convince an entire faculty to embrace major change, Henderson suggested schools allow a few highly motivated professors to engage in small-scale experimentation. “You have to start small and not say, ‘We’re going to change legal education,’ ” Henderson said. “Let’s start with a few classes.” ...

Panelists also zeroed in on what they called an outsized emphasis on faculty scholarship. Many law schools expect professors to spend 40 percent of their time on scholarship, 40 percent on teaching and 20 percent on public service. That leaves less time to develop innovating teaching methods, especially for the younger, untenured professors—those most likely to embrace innovation and change.

April 28, 2014 in Legal Education | Permalink | Comments (8)

Shaviro, Sullivan Speak on Tax Reform at NYU Today

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Book Discussison (12:30 - 1:50 p.m.):  Daniel Shaviro (NYU), Fixing U.S. International Taxation (Oxford University Press, 2014):

FixingInternational tax rules, which determine how countries tax cross-border investment, are increasingly important with the rise of globalization, but the modern U.S. rules, even more than those in most other countries, are widely recognized as dysfunctional. The existing debate over how to reform the U.S. tax rules is stuck in a sterile dialectic, in which ostensibly the only permissible choices are worldwide or residence-based taxation of U.S. companies with the allowance of foreign tax credits, versus outright exemption of the companies’ foreign source income. In Fixing U.S. International Taxation, Daniel N. Shaviro explains why neither of these solutions addresses the fundamental problem at hand, and he proposes a new reformulation of the existing framework from first principles. He shows that existing international tax policy frameworks are misguided insofar as they treat “double taxation” and “double non-taxation” as the key issues, conflate the distinct questions of what tax rate to impose on foreign source income and how to treat foreign taxes, and use simplistic single-bullet global welfare norms in lieu of a comprehensive analysis. Drawing on tools that are familiar from public economics and trade policy, but that have been under-utilized in the international tax realm, Shaviro offers a better analysis that not only reshapes our understanding of the underlying issues, but might point the way to substantially improving the prevailing rules, both in the U.S. and around the world.”

  • Daniel Shaviro (NYU)
  • Itai Grinberg (Georegtown)
  • Martin Sullivan (Tax Analysts)

Public Lecture (6:00 - 7:30 p.m.):  Martin Sullivan (Tax Analysts), Tax Reform 2017: Incremental or Fundamental?:

Sullivan (2014)Martin Sullivan is the chief economist of Tax Analysts (publisher of Tax Notes) and is a leading expert on federal tax reform. He is a contributing editor for Tax Analysts’ daily and weekly publications. Sullivan has written over 500 economic analyses for Tax Analysts and is the author of two books on tax reform, including the recent Corporate Tax Reform: Taxing Profits in the 21st Century. He is also a regular contributor to Tax Analysts’ blog and He has testified before Congress on numerous occasions. Previously, Sullivan taught economics at Rutgers University and served as a staff economist at the U.S. Department of the Treasury and later at the congressional Joint Committee on Taxation. Sullivan graduated magna cum laude from Harvard College and received a PhD in economics from Northwestern University. 

April 28, 2014 in Book Club, Colloquia, Scholarship, Tax | Permalink | Comments (0)

6th Circuit Rejects Discrimination Claim by Miami University Prof Over Refusal to Solicit Outside Reviews From Faculty at Historically Black Colleges and Universities

HBCUInside Higher Ed, Who Gets to Decide?:

A divided federal appeals court [last] month upheld the dismissal of a lawsuit against Miami University that charged racial discrimination against a black faculty member in the tenure process [Thrash v. Miami University, No. 13-3489 (6th Cir. Mar. 10, 2014)].

A key argument in the lawsuit was that a chair showed racial bias by rejecting potential candidates for the external review who were at historically black colleges. But the majority in the case, noting that a majority of those on the external panel were black, rejected that argument and accepted the possibility of other, legitimate reasons for rejecting those candidates.

April 28, 2014 | Permalink | Comments (0)

4th Annual SoCal Tax Prof Dinner

My wife and I hosted the 4th Annual Southern California Tax Prof Dinner last night and had a wonderful evening filled with great food (especially the Lazerows' tangerine chocolate cake), drink, and conversation.

SoCal 1

Bobby Dexter

Victoria Haneman

Tom Bost
Paul Caron
Khrista Johnson


San Diego
Jordan Barry
Bert Lazerow

Thomas Jefferson Richard Winchester

Jason Oh

Ed Kleinbard

We began the day saying farewell to two of our favorite new Southern California friends:  Tax Prof Nancy Staudt and Lee Epstein are leaving USC for Washington University -- Nancy as Dean and Howard & Caroline Cayne Professor of Law and Lee as Ethan A.H. Shepley Distinguished University Professor.

Lee and Nancy 1

April 28, 2014 in Legal Education, Tax | Permalink | Comments (0)

How to Choose a School for Tax Law

preLaw Magazine (Spring 2014):  How to Choose a School for Tax Law:

Tax LawIf there's one law specialty with staying power, this is it.

"Tax law affects every aspect of our lives, from deeply personal decisions, like marriage, child care, education and housing, to esoteric topics, like cross-border deals and complex financial transactions," said Victor Fleischer, a professor of law at the University of San Diego School of Law.

Heather Field, an expert in tax law at the University of California, Hastings College of the Law, believes the field has enduring strengths.  "As I tell my students, as long as our federal, state and local governments continue to operate, they will need money," she said.  As long as our governments need money, there will be taxes.  And as long as there are taxes, taxpayers will want to pay as little as possible, and governments will want to collect as much as possible, which means that both taxpayers and governments will need tax lawyers."

preLaw lists the law schools with:

  • Tax Certificate Programs (14 law schools)
  • Tax Centers (8 law schools)
  • Tax Clinics (27 law schools)
  • Tax Externships (42 law schools)

April 28, 2014 in Legal Education | Permalink | Comments (0)

Ring: The Influence of Experts

Diane Ring (Boston College), The InfluencJotwelle of Experts (Jotwell) (reviewing Mai’a K. Davis Cross, Rethinking Epistemic Communities Twenty Years Later, 39 Rev. Int’l Studies 137 (2013)):

Why do certain ideas gain traction in policy debates? Regardless of one’s field of study, this question cannot be ignored. The challenge is where to look for answers. The 2013 article by political scientist Mai’a Davis Cross, Rethinking Epistemic Communities Twenty Years Later, is one new and relevant resource in this quest. For more than a decade international tax scholars have drawn on the work of international relations (IR) theory and scholarship. In part, this attention by the tax community was out of necessity. Although it was apparent that international tax policy was subject to and the product of the same basic forces animating the classic subjects of IR study (e.g., military, trade, and environmental policy) tax policy formation traditionally has received scant attention from this branch of political science research. Yet the ideas being developed in IR theory would prove important to a serious and sophisticated understanding of “international tax relations.” Thus, international tax scholars began looking across the divide of research fields to consider the value added from the IR theory work of political scientists such as Cross. ...

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April 28, 2014 in Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 354

TaxProf Blog Weekend Roundup

Sunday, April 27, 2014

States With the Best and Worst Taxpayer Return on Investment

ROIWallet Hub, States with the Best & Worst Taxpayer ROI:

There is an obvious disconnect in the minds of taxpayers between the amount we fork over each April and what we ultimately receive from the government in return.  Tax Day is a tangible, painful reminder of our investments in federal, state and local governments, but it’s difficult to discern the government’s precise role in our day-to-day quality of life and overall pursuit of happiness.  Perhaps that’s why 52% of people feel they pay too much in taxes and most people think roughly half of their tax dollars are being wasted.

One thing we do know is that taxpayer return on investment varies significantly based on simple geography.  Federal income tax rates are uniform across the country, yet some states get far more federal funding than others – as WalletHub recently illustrated in its Federal Government Dependency Report.  But federal taxes and funding are only part of the story.

Ideological differences regarding the role of local taxation have resulted in citizens of each state shouldering dramatically different tax burdens.  This, of course, begs the question of whether people in high-tax states benefit from correspondingly superior government services or if low-tax states are more efficient.  In short, where do taxpayers get the most and least bang for their buck?

WalletHub sought to answer that question by contrasting state and local tax rates to the quality of the services that are funded at those levels, which we separated into six main categories – Infrastructure, Education, Health, Safety, Economy and Pollution – that collectively consist of 27 metrics.




Tax Rank

Gov't Services Rank

1 Wyoming 1 13
2 Alaska 2 26
3 South Dakota 5 15
4 Washington 6 10
5 North Dakota 9 14
6 Colorado 10 11
T-7 Florida 4 36
T-7 Texas 7 24
9 Utah 14 5
10 Massachusetts 21 7
42 Kentucky 30 41
43 Alabama 12 48
T-44 California 50 38
T-44 Tennessee 25 45
46 West Virginia 18 47
47 North Carolina 35 43
48 District of Columbia 37 44
49 Louisiana 17 49
50 Mississippi 15 51
51 Arkansas 31 50

(Hat Tip: The Fiscal Times.)

April 27, 2014 in Tax | Permalink | Comments (3)

Top 5 Tax Paper Downloads

Best Wishes to Mike Lang

Lang (2014)Best wishes to Mike Lang, who is recovering nicely from a heart attack in March.  As many of you know, Mike was a tax professor at the University of Maine School of Law for twenty years before joining the tax faculty at Chapman University School of Law in 2002.  Mike is the co-author of two books in our LexisNexis Graduate Tax Series:


April 27, 2014 in Tax | Permalink | Comments (0)

The IRS Scandal, Day 353

IRS Logo 2House Committee on Oversight Press Release, Oversight Committee Probes Justice Department Role in IRS Targeting:

House Oversight and Government Reform Committee Chairman Darrell Issa (R-Calif.) and sixteen Oversight Committee members asked Department of Justice Attorney General Eric Holder to produce documents and a Justice Department official for a transcribed interview to explain why his agency would consider prosecution of tax-exempt groups already improperly targeted by the Internal Revenue Service (IRS).  Last week, Judicial Watch released IRS documents showing former IRS official Lois Lerner in contact with Justice Department about potential prosecution of tax-exempt groups.

A previously unreleased e-mail related to last week’s FOIA release by Judicial Watch reveals that the Justice Department employee did not reach out to Lerner on his own. Instead, Richard Pilger, Director of the Election Crimes Branch of the Department’s Public Integrity Section, noted via e-mail to Lerner on May 8th 2013, “I have been asked to run something by you.” The e-mail does not indicate who had asked Pilfer to contact Lerner. Additionally, the letter notes that the Department considered prosecuting these groups for actions that are legal for 501(c)(4) nonprofits under federal tax law – that is, engaging in political speech.

The members wrote: “Mr. Pilger’s communications with Ms. Lerner are also striking for their timing.  They show that the IRS and the Justice Department were actively considering efforts to target tax-exempt organizations just two days before Ms. Lerner’s public apology for the targeting. This information certainly undermines the sincerity of Ms. Lerner’s apology, but it calls into question your reaction that targeting was ‘outrageous’ and ‘unacceptable.’  These comments ring hollow in light of evidence that your subordinates apparently colluded with the IRS to target nonprofit groups less than a week before.

Letter From Darrell Issa to Eric Holder (Apr. 23, 2014):

The Committee on Oversight and Government Reform continues to examine the Interna Revenue Service's targeting of conservative tax-exempt appl icants.  We are deeply dismayed that the Department of Justice may have contributed to this inappropriate treatment by considering prosecution of tax-exempt groups engaged in political speech.  This information, released by Judicial Watch, damages the integrity of the Department and tµldennines its fundamental mission of "fair and im partial admi nistration of justice for all Americans."  We request your assistance as we examine this matter.

We are severel y disappointed in the Department's apparent contribution to the Administration's targeti ng of tax-exempt applicants. With your constant remi nders about the Department's limited criminal justice resources, we would have hoped that the Department would better focus its prosecutorial resources. To examine fully the Department's apparent role in targeting tax-exempt applicants and the Department's coordination with the IRS on this matter, we ask that you produce the following material as soon as possi ble, but no later than May 5, 2014.

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April 27, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Saturday, April 26, 2014

The Debate Over Thomas Piketty's Capital in the 21st Century

CapitalFollowing up on my previous post on the new book by  Thomas Piketty (Paris School of Economics), Capital in the Twenty-First Century (Harvard University Press, 2014):

David Brooks (New York Times), The Piketty Phenomenon:

Piketty ... argues that the real driver of inequality is not primarily differences in human capital. It’s differences in financial capital. Inequality is not driven by young hip professionals who arm their kids with every advantage and get them into competitive colleges; it’s driven by hedge fund oligarchs. Well, of course, this book is going to set off a fervor that some have likened to Beatlemania.

The book is very good and interesting, but it has pretty obvious weaknesses. Though economists are really not good at predicting the future, Piketty makes a series of educated guesses about the next century. ...

Politically, the global wealth tax is utopian, as even Piketty understands. If the left takes it up, they are marching onto a bridge to nowhere. But, in the current mania, it is being embraced.

This is a moment when progressives have found their worldview and their agenda. This move opens up a huge opportunity for the rest of us in the center and on the right. First, acknowledge that the concentration of wealth is a concern with a beefed up inheritance tax. Second, emphasize a contrasting agenda that will reward growth, saving and investment, not punish these things, the way Piketty would. Support progressive consumption taxes not a tax on capital. Third, emphasize that the historically proven way to reduce inequality is lifting people from the bottom with human capital reform, not pushing down the top. In short, counter angry progressivism with unifying uplift.

Paul Krugman (Princeton), Why We’re in a New Gilded Age (New York Review of Books):

The big idea of Capital in the Twenty-First Century is that we haven’t just gone back to nineteenth-century levels of income inequality, we’re also on a path back to “patrimonial capitalism,” in which the commanding heights of the economy are controlled not by talented individuals but by family dynasties.

It’s a remarkable claim—and precisely because it’s so remarkable, it needs to be examined carefully and critically. Before I get into that, however, let me say right away that Piketty has written a truly superb book. It’s a work that melds grand historical sweep—when was the last time you heard an economist invoke Jane Austen and Balzac?—with painstaking data analysis. And even though Piketty mocks the economics profession for its “childish passion for mathematics,” underlying his discussion is a tour de force of economic modeling, an approach that integrates the analysis of economic growth with that of the distribution of income and wealth. This is a book that will change both the way we think about society and the way we do economics. ...

Piketty ends Capital in the Twenty-First Century with a call to arms—a call, in particular, for wealth taxes, global if possible, to restrain the growing power of inherited wealth. It’s easy to be cynical about the prospects for anything of the kind. But surely Piketty’s masterly diagnosis of where we are and where we’re heading makes such a thing considerably more likely. So Capital in the Twenty-First Century is an extremely important book on all fronts. Piketty has transformed our economic discourse; we’ll never talk about wealth and inequality the same way we used to.

Paul Krugman (Princeton), The Piketty Panic (New York Times):

The really striking thing about the debate so far is that the right seems unable to mount any kind of substantive counterattack to Mr. Piketty’s thesis. Instead, the response has been all about name-calling — in particular, claims that Mr. Piketty is a Marxist, and so is anyone who considers inequality of income and wealth an important issue. ...

[W]hat’s really new about “Capital” is the way it demolishes that most cherished of conservative myths, the insistence that we’re living in a meritocracy in which great wealth is earned and deserved. ... [T]he fact that apologists for America’s oligarchs are evidently at a loss for coherent arguments doesn’t mean that they are on the run politically. Money still talks — indeed, thanks in part to the Roberts court, it talks louder than ever. Still, ideas matter too, shaping both how we talk about society and, eventually, what we do. And the Piketty panic shows that the right has run out of ideas.

Greg Mankiw (Harvard), First Thoughts on Piketty:

The book has three main elements:

  1. A history of inequality and wealth.
  2. A forecast of how things will evolve over the next century
  3. Policy recommendations, such as a global tax on wealth.

Point 1 is a significant contribution. I like this part of the book a lot.

Point 2 is highly conjectural. Economists are really bad at such things. In particular, the leap from r>g to the conclusion of a growing role of inheritance in society seems too large to me. Many capital owners consume much of the return on their capital, so wealth does not grow at rate r. This consumption ranges from fancy cars and luxurious vacations to generous charitable giving. In addition, unless mating is perfectly assortative, or we return to an era of primogeniture, wealth per family shrinks as it is split among children.  So, from my perspective, Pikettty tries to draw way too much from r>g. ...

Point 3 is as much about Piketty’s personal political philosophy as it is about his economics. As we all know, you can’t get “ought” from “is.” Like President Obama and others on the left, Piketty wants to spread the wealth around. Another philosophical viewpoint is that it is the government’s job to enforce rules such as contracts and property rights and promote opportunity rather than to achieve a particular distribution of economic outcomes. No amount of economic history will tell you that John Rawls (and Thomas Piketty) offers a better political philosophy than Robert Nozick (and Milton Friedman).

The bottom line: You can appreciate his economic history without buying into his forecast.  And even if you are convinced by his forecast, you don't have to buy into his normative conclusions.

April 26, 2014 in Book Club, Tax | Permalink | Comments (0)

Which Law Schools Are Shedding Their Full-Time Faculty?

Matt Leichter, Which Law Schools Are Shedding Full-Time Professors (2013 Edition)?:

These are sorted by net two-year reduction by school with the fewest number of full-time faculty in 2011, the idea being that a small school that reduces its professors by the same number as a larger one sees a bigger impact.

The median law school reduced its full-time faculty by three between 2011 and 2013.  26 law schools reduced their full-time faculty by nine or more:

Full-Time Faculty (Fall)
RankSchool (US News Rank)’11’12’13Annual ChangeNet Change
1. Chicago (4) 67 70 46 -24 -21
1. Florida Coastal (Tier 2) 69 60 48 -12 -21
3. McGeorge (146) 49 43 33 -10 -16
4. St. Louis 55 49 40 -9 -15
5. St. John’s (107) 52 39 38 -1 -14
5. Hofstra (93) 56 54 42 -12 -14
5. New York Law School (140) 70 57 56 -1 -14
8. Widener (Tier 2) 51 51 38 -13 -13
8. Catholic (107) 52 43 39 -4 -13
8. Fordham (36) 85 81 72 -9 -13
11. Hamline (121) 34 26 22 -4 -12
11. UC-Hastings (54) 67 57 55 -2 -12
13. La Verne (n/r) 19 8 8 0 -11
13. Roger Williams (Tier 2) 27 20 16 -4 -11
13. Touro (Tier 2) 36 34 25 -9 -11
13. Pace (140) 48 41 37 -4 -11
13. John Marshall (IL) (Tier 2) 69 69 58 -11 -11
18. William Mitchell (135) 39 35 29 -6 -10
18. Wisconsin (31) 57 54 47 -7 -10
18. Stetson (93) 58 48 48 0 -10
18. UC-Berkeley (9) 65 63 55 -8 -10
18. Brooklyn (83) 66 63 56 -7 -10
23. Golden Gate (Tier 2) 36 30 27 -3 -9
23. Albany (118) 44 40 35 -5 -9
23. Seton Hall (68) 49 41 40 -1 -9
23. Loyola (CA) (87) 67 65 58 -7 -9

20 law schools bucked the trend and increased their full-time faculty by five or more between 2011 and 2013:

Full-Time Faculty (Fall)
RankSchool (US News Rank)’11’12’13Annual ChangeNet Change
178. Duquesne (121) 23 27 28 1 5
178. New Mexico (72) 28 29 33 4 5
178. Richmond (51) 32 31 37 6 5
178. Rutgers (Newark) (83) 34 38 39 1 5
178. Pepperdine (54) 35 40 40 0 5
178. North Carolina (31) 44 49 49 0 5
178. San Diego (79) 55 47 60 13 5
185. Elon (Tier 2) 17 19 23 4 6
185. Ohio State (31) 38 45 44 -1 6
187. Loyola (IL) (68) 48 48 55 7 7
187. UCLA (16) 72 76 79 3 7
189. Rutgers (Camden) (81) 45 48 53 5 8
190. Yale (1) 61 71 70 -1 9
191. William & Mary (24) 39 38 49 11 10
192. South Dakota (145) 1 15 14 -1 13
192. Mississippi (104) 17 28 30 2 13
192. Denver (68) 62 73 75 2 13
192. Thomas Cooley (Tier 2) 102 96 115 19 13
196. Charlotte (Tier 2) 39 62 64 2 25
196. Columbia (4) 127 142 152 10 25

April 26, 2014 in Law School Rankings, Legal Education | Permalink | Comments (1)

Et Tu, Peter Orszag?

Diet CokeFollowing up on my post, Farewell, My Friend, in which I recounted how I have reduced my Diet Coke consumption by 75% (on the way to 100%):  Bloomberg View:  Your Diet Coke Won't Kill You, by Peter R. Orszag (Citibank; former Director, Office of Management & Budget):

When I was director of the Congressional Budget Office, I was testifying so frequently to the Senate Finance Committee that the chairman granted me a special exception to the committee rules: He allowed me to drink diet soda rather than just water during hearings. At my peak, I was downing up to eight diet sodas a day.

My family did not think this was such a great idea, and at their urging I have largely eliminated my diet soda drinking. Recent data from Beverage Digest suggest others are cutting back also; consumption of diet sodas fell more than that of sugary sodas in 2013. “While the health risks of sugary sodas have been publicized for some time, the growing public aversion to diet drinks -- with many believing artificial sweeteners are also unhealthy -- has caught the industry somewhat off guard," the Wall Street Journal noted.

This raises two questions: Why is total consumption declining, and is drinking diet soda harmful to health?...

I’m glad that my family succeeded in getting me to shift away from diet soda and toward tea. Yet I’d say the case is still out on whether my health was ever at risk.

April 26, 2014 in Legal Education, Tax | Permalink | Comments (1)

The IRS Scandal, Day 352

IRS Logo 2Tax Analysts Blog:  The IRS and the Tax System: Integrity and Fairness for Whom?, by Christopher Bergin:

There are many people who no doubt would like to harm the IRS. Some of that comes with the territory –- after all, most taxpayers dislike the tax collector. But right now, the one hurting the IRS the most is the IRS itself. In the latest bonehead maneuver from the IRS, the Treasury Inspector General for Tax Administration issued a report this week that revealed that agency employees with conduct and tax compliance problems received bonuses and awards. ...

Are you kidding me?! ...

The IRS’s mission statement couldn’t be clearer:

Provide America's taxpayers top quality service by helping them understand and meet their tax responsibilities and enforce the law with integrity and fairness to all.

If some of the tax cops aren’t playing by the rules – and getting bonuses for it – how does that provide us taxpayers “top quality service” and help us understand and meet our tax responsibilities? The two most important words in this mission statement are “integrity” and “fairness.” The one thing largely missing from our tax code is fairness. And the one thing now beginning to disappear from the agency charged with administering that tax code is integrity.

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April 26, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, April 25, 2014

William J. Holloway, Jr., 1923-2014

HollowayWilliam Judson Holloway, Jr., former Chief Judge of the U.S. Court of Appeals for the Tenth Circuit, died this morning surrounded by his family.

William J. Holloway, Jr. was born in Hugo, Oklahoma, in 1923. He is the son of the late Governor and Mrs. William J. Holloway.

Judge Holloway's family moved to Oklahoma City in 1927, where he received his elementary education in the Oklahoma City public schools, graduating from Classen High School in 1941. He attended the University of Oklahoma for two years before World War II and for one year after serving in the United States Army, receiving his B.A. from the University in 1947. He received his LL.B. from Harvard Law School in 1950.

After being in general practice with his father and uncle in Oklahoma City, he served as an attorney in the Department of Justice in Washington, D.C., in 1951 and 1952. He then returned to general practice in Oklahoma City until his appointment by President Johnson as a United States Circuit Judge of the Tenth Circuit on September 16, 1968. He served as Chief Judge of the Tenth Circuit from September 1984 until September 1991 and assumed senior status in 1992.

Judge Holloway altered the trajectory of my life.  When I was applying for judicial clerkships, my Cornell friend and classmate Richard Paar, who was from Oklahoma City, suggested that I apply to clerk in Judge Holloway's chambers.  I got the job, packed up my Honda Civic in August 1983 and made the 1,700 mile trek from Massachusetts to Oklahoma to begin my post law school life.  Judge Holloway was an ideal mentor, modeling genuine kindness (to everyone), a prodigious work ethic (which included feeding his clerks hot dogs and Twinkies on Saturdays in the office), and a deep love for his family.  He graciously indulged my fantasy of becoming a law professor someday by allowing me to write three articles and teach on an adjunct basis at Oklahoma City University School of Law and the University of Oklahoma College of Law during my clerkship.

I dated my co-clerk, Courtney Bryan, and Judge Holloway looked the other way until we announced at the end of our clerkship that we were getting married.  He helped us land our jobs in Boston and later in Cincinnati.  We kept in touch through the years, including on April 19, 1995 when Judge Holloway was working in his chambers across the street from the Alfred P. Murrah Federal Building.

Courtney and I frequently marvel at the fates that brought us together in Oklahoma City and now have us living next door to my Dean and Judge Holloway's former Tenth Circuit colleague, Deanell Tacha.  Last month, we reconnected with our former co-clerk Steve Garrett, who came to Malibu on a college tour with his daughter.  We had dinner together and spoke long into the night about how our time with Judge Holloway had launched us into our professional lives.  We regaled ourselves (and bored Steve's daughter) with tales of our clerkships -- including the time the Judge called Steve and me into his office to speak with a FBI agent (that's a long story!).  

We learned much about the law and even more about life clerking for Judge Holloway.  We will always be grateful for the opportunity to work for and get to know this man who "lived greatly in the law" (Oliver Wendell Holmes).

April 25, 2014 in Legal Education, Obituaries, Tax | Permalink | Comments (4)

IRS Shuts Down Killer B Repatriations (Again)

IRS Logo 2The IRS today released Notice 2014-32,  2014-20 I.R.B. ___ (May 12, 2014):

Notice 2014-32 announces modifications and clarifications to the regulations under section 367(b) of the Internal Revenue Code relating to the treatment of property used to acquire parent stock or securities in certain triangular reorganizations involving foreign corporations (colloquially referred to as the “Killer B regulations”). The notice eliminates the deemed contribution model under the existing regulations. In addition, the notice modifies the amount of income and gain taken into account for purposes of applying the priority rules of section 367(a) and (b). Further, the notice clarifies the application of the anti-abuse rule.

(Hat Tip: Brian Davis)

April 25, 2014 in IRS News, Tax | Permalink | Comments (0)

Weekly Tax Roundup

 Weekly Roundup

April 25, 2014 in Tax, Weekly Tax Roundup | Permalink | Comments (0)

Weekly SSRN Tax Roundup

April 25, 2014 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (1)

Weekly Student Tax Note Roundup

NYLS Hosts Annual Tax Lawyering Workshop Today

NYLS Logo (2013)The New York Law School Graduate Tax Program hosts its annual Tax Lawyering Workshop today:

Keynote AddressKaren L. Hawkins (Director, Office of Professional Responsibility, IRS), Ethics and Circular 230: History, Process and Impact

Session #1:  Standards of PracticeDennis J. Ventry, Jr. (UC-Davis), Probability, Professionalism, and Protecting Taxpayers, 68 Tax Law. ___ (2014) (with Bradley Borden (Brooklyn)):

Lawyers are not mathematicians. Nor are they statisticians or economists. Yet they regularly make probability assessments pertaining to the outcome of pleadings, motions, hearings, litigation strategies, written and oral opinions, and business transactions. Moreover, they make these predictions in a sea of uncertainty, subject to conditions and interdependent variables largely beyond their ken or control. Even more daunting, while some lawyers render these estimates without tangible fear of negative professional implications or discipline thanks to ethical rules that tolerate debased levels of confidence (e.g., not frivolous and colorable), others within the profession must meet considerably higher standards of care while suffering harsher and more palpable penalties, including monetary fines, censure, suspension, and disbarment. These tremulous souls are known as tax lawyers.

This Article analyzes the affirmative and disciplinary duties imposed on tax lawyers that require them to make probability assessments about the merits of a client’s tax position or tax-favored transaction, and to reflect those estimates with numerical precision. It describes how the Treasury Department, Congress, and the American Bar Association (often in concert, occasionally at odds) forged this obligatory standard of care over the last three decades with the shared goal of facilitating accurate advice, accurate tax returns, and compliance with the law. The resulting regulatory standard of care for tax lawyers (which swept aside the old regime of self-regulation) monitors flawed methodological processes, while also minimizing psychological biases and misaligned incentives that can distort professional judgment. In this way, the standard of care for tax lawyers—particularly its emphasis on improving accuracy and reducing errors by updating subjective beliefs with new, relevant information—reflects a branch of probabilistic decision theory known as Bayesian reasoning.

Session #2:  Professional Responsibility Issues in Estate and Trust AdministrationLee Miller (Managing Director, Glenmede Investment and Wealth Management, New York) 

Session #3:  The Tax Lawyer's Dilemma: Conflicting Professional and Legal Obligations When Client Misconduct Endangers the AttorneyLawrence S. Feld (New York Law School)

April 25, 2014 in Scholarship, Tax, Tax Conferences | Permalink | Comments (0)

Tax Analysts Hosts Conference Today on Marketing Derivatives to Market for Tax Purposes

Tax NotesTax Analysts hosts a roundtable discussion on Marketing Derivatives to Market for Tax Purposes at the Ronald Reagan Building (1300 Pennsylvania Ave.) today at 3:00 - 5:00 p.m. EST in Washington, D.C.:

Rep. Camp recently proposed requiring all derivatives to be marked to market unless they are part of hedges. Marking derivatives to market is a source of controversy, but it has been under consideration by Treasury for a while. Supporters believe that it is necessary to clearly reflect income and to prevent taxpayers from exploiting different treatment of economically similar products. Critics argue that marking would complicate tax accounting for holders. The discussion will introduce the politics and history of mark-to-market in tax, examine Camp’s derivatives plan in detail, and debate the merits of marking certain types of derivatives

  • Christopher E. Bergin (President and Publisher, Tax Analysts) 
  • Viva Hammer (Legislation Counsel, Joint Committee on Taxation)
  • Yoram Keinan (Partner, Carter Ledyard & Milburn)
  • Lee A. Sheppard (Contributing Editor, Tax Analysts)

April 25, 2014 in Tax, Tax Analysts, Tax Conferences | Permalink | Comments (2)

Is Tax For the Timid?

Above the Law:  Picking The Right Law Firm And Practice Area For You, by Abby Gordon (Lateral Link, New York):

Choosing a law firm and a practice area is a big decision. While 62% of lawyers move firms within their first four years of practice, your career path will likely be clearly shaped by your first job as a lawyer. I cannot stress enough how difficult it is to switch practice areas once you have started your legal career. ... So what are the major factors you should consider in choosing a firm as a summer associate or first-year associate?...

Cowardly LionCertain practice areas also tend to attract distinct personalities or cultures. There are of course exceptions to the rules. But you are likely to find more charismatic, outgoing, or at times aggressive personalities in litigation, or perhaps on an M&A team. You may find more timid characters in tax or on an intellectual property team. In certain practice areas (such as litigation), you may work primarily on large teams, whereas in more niche practice areas (tax, for example), you will likely be working on smaller teams or do more individual work....

Your pre-law academic background may make you more marketable in certain practice areas or may impose a glass ceiling on your career advancement prospects. Be sure you have the right background to progress in your practice area (or at least be aware that if you do not have this training, you will be facing an uphill battle).

A finance or accounting background or aptitude will be extremely useful for most corporate work and for tax. You will be expected to have a general understanding of company finances. You will be expected to read, understand, and check financial statements for accuracy. As a capital markets lawyer, I often turned to my calculator or an excel spreadsheet. As underwriters’ counsel, I worked closely with the accountants. ...

Tax and trusts & estates generally require an LL.M. If bar review class put you over the edge and you never want to take another class as long as you live, avoid these practice areas. ...

If you would like to move to a small town one day, experience with general corporate, real estate, or tax law may be more translatable into a small firm or solo practice. ... if you prefer stability, a practice area such as patent prosecution or tax may be better suited to you.

April 25, 2014 in Tax | Permalink | Comments (2)

Time: What Law Schools Can Teach Colleges About Lowering Tuition

TimeTime:  What Law Schools Can Teach Colleges About Lowering Tuition:

Law schools at public universities dropped their median tuition by an average of 5% in 2011 and another 8% in 2012, according to the American Bar Association, as private law school tuition increased by an annual average of only 4%, the lowest in 26 years. This followed a staggering drop in the number of applicants in each of the past three years. In 2004, according to the Law School Admission Council, more than 100,000 people applied to law schools; last year 59,400 did. It’s little wonder when there are few jobs for graduates to take. “We’re in an unprecedented time,” said Judith Areen, a former Georgetown University law dean who now directs the Association of American Law Schools. “There’s been almost a freeze in lawyer hiring.”

The downturn has forced law schools to offer discounts unlike any seen before. Pennsylvania State University has offered Pennsylvania residents annual $20,000 tuition discounts at its Dickinson School of Law, cutting tuition nearly in half. The University of Iowa reduced fall 2014 tuition by more than 16% for most law students, and Ohio Northern University law students will pay nearly $9,000 less next fall than they did this year. New York’s Brooklyn Law School this month announced it would reduce tuition by 15% in 2015. The universities of Massachusetts and Maryland have frozen tuition in the past two years.

The hefty discounts appear to be working, for some. Applications at Iowa have increased by more than 70% over this point last year, said the dean, Gail Agrawal. The boost is a relief for the school, which saw a 40% drop in its number of first-year law students from 2012 to 2013. “I think we became the greatest value ever,” Agrawal said. “If you’re a public (university), you do have to worry about issues like access and affordability. We’d been thinking about it for a while. It’s a philosophical question for the university.” ...

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April 25, 2014 in Legal Education | Permalink | Comments (0)

The IRS Scandal, Day 351

Thursday, April 24, 2014

Kleinbard Delivers Pugh Lecture at San Diego Today on Progressive Tax or Progressive Fiscal System?

KleinbardEdward Kleinbard (USC) delivers the annual Richard C. Pugh Lecture on Tax Law & Policy at San Diego today on Progressive Tax or Progressive Fiscal System?:

Americans largely take for granted that our tax system should be “progressive.” But why is that desirable? This presentation will analyze the normative foundations of progressive taxation, and argue that the instinct ultimately is misguided: what those who favor progressivity should care about is a progressive fiscal system. The two are not synonyms: even regressive taxes can lead to progressive fiscal outcomes.

The lecture is based on Ed'd forthcoming book, We Are Better Than This: How Government Should Spend Our Money (Oxford University Press, Sept. 2014):

We Are Better Than This fundamentally reframes budget debates in the United States. Author Edward D. Kleinbard explains how the public's preoccupation with tax policy alone has obscured any understanding of government's ability to complement the private sector through investment and insurance programs that enhance the general welfare and prosperity of our society at large.

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April 24, 2014 in Scholarship, Tax | Permalink | Comments (0)

Miami Professor 'Beaten to a Pulp' in Retaliation for a Bad Grade

Miami Dade College music professor Marc Magellan was "beaten to a pulp" in the school's parking garage, allegedly in retaliation for a bad grade:

April 24, 2014 in Legal Education | Permalink | Comments (0)