Paul L. Caron

Monday, July 31, 2017

WSJ: Tax Reform Principles

Wall Street Journal editorial, Tax Reform Principles:

The ‘Big Six” GOP tax negotiators released a statement of principles Thursday, and the main news is the death of the House border-adjustment tax. A favorite idea of Speaker Paul Ryan, the BAT was savaged by retailers who feared they’d pay more for imports. The problem is that the BAT would have raised as much as $1 trillion to pay for lower tax rates, so its defeat raises a new obstacle to reform.

This shows that tax reform may be even harder to pull off than repealing ObamaCare given how politicians have laced the tax code with subsidies and carve-outs. Interests clawing to keep their favors usually defeat the public interest in lower rates. But the potential payoff in faster growth and rising incomes is still worth the political effort, so give Congress and President Trump credit for setting the goal of a signing ceremony this year.

As the debate begins, this is a good moment to offer some principles to judge how reform is faring:

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July 31, 2017 in Tax | Permalink | Comments (4)

Anderson, Faigman Debate: Should California Lower Its Bar Exam Cut Score?

Air TalkFollowing up on my previous posts (links below):  AirTalk, Discussing Impact on Law Students, Legal Profession If CA Supreme Court Lowers State Bar ‘Cut Score’:

California’s ‘cut score,’ the grade required to pass the exam, is higher than all other states except one: Delaware. But a debate has been raging in legal circles across the Golden State about whether California’s cut score for the bar was realistic. Now, the state’s high court is taking action.

The California Supreme Court has amended the state's ‘Rules of Court’ to say that the supreme court, not a State Bar of California board, will be the body to decide what a passing score is. This follows a 2016 that saw just 62 percent of test-takers from American Bar Association accredited schools pass the test. Under New York State’s cut score, 87 percent would have passed.

The discrepancy has alarmed some in the legal profession. In February, deans from 20 ABA-accredited schools wrote the Supreme Court of California and requested that it lower the cut score. ... 

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July 31, 2017 in Legal Education | Permalink | Comments (2)

NY Times: Mysterious Charitable Donation Of $18 Billion Stake In HNA Group Of China Leaves Foundation With 52%, Triggering Tax Concerns

HNANew York Times Deal Book, Behind an $18 Billion Donation to a New York Charity, a Shadowy Chinese Conglomerate:

At first glance, it appears to be one of the most generous donations in the history of philanthropic giving in America.

A Chinese man has transferred more than 29 percent of HNA Group of China — the equivalent of as much as $18 billion — to a New York-based private foundation. The donation puts him in the same league as donors like Bill Gates and Warren E. Buffett and almost matched the combined giving of all American corporations in 2016.

But it has not been disclosed how that man, Guan Jun, who is in his 30s, came to own such a large piece of one of China’s biggest conglomerates. His registered address in Beijing is a modest apartment at the end of a dingy hallway littered with discarded furniture and bags of trash. ...

The decision to transfer Mr. Guan’s stake to the foundation, HNA said, was to allay concerns over its shareholding. Scrutiny of its ownership had escalated after Anthony Scaramucci, the new White House communications director, announced in January that he was selling his hedge fund to an HNA subsidiary.

Instead, HNA, in making the unusual decision to transfer such a large portion of its ownership to an American foundation, raises questions about how it will comply with United States tax law.

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July 31, 2017 in Tax | Permalink | Comments (0)

Charlotte Law School Faces An Uncertain Future, But It Is Not Alone

Charlotte Logo (2016)ABA Journal, Charlotte School of Law Faces an Uncertain Future, But It Is Not Alone:

Last year, the Department of Education, then under the Obama administration, cut off federal loans to current CSL students. The federal loans were released at the end of the school year, but only for some students. And it’s not just the students and graduates: The law school itself is caught in a grim scenario.

Out of the country’s six for-profit law schools that have ABA accreditation, three, including Charlotte, are part of the InfiLaw System, a consortium owned by the private-equity company Sterling Partners. Arizona Summit Law School, another InfiLaw school, was put on probation by the ABA in March.

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July 31, 2017 in Legal Education | Permalink | Comments (2)

Fall 2017 Law Review Article Submission Guide

SubmissionsNancy Levit (UMKC) & Allen Rostron (UMKC) have updated their incredibly useful document, which contains two charts for the Fall 2017 submission season covering 204 law reviews.

The first chart (pp. 1-50) contains information gathered from the journals’ websites on:

  • Methods for submitting an article (such as by e-mail, ExpressO, regular mail, Scholastica, or Twitter)
  • Any special formatting requirements
  • How to request an expedited review
  • How to withdraw an article after it has been accepted for publication elsewhere

The second chart (pp. 51-57) contains the ranking of the law reviews and their schools under six measures:

  • U.S. News: Overall Rank
  • U.S. News: Peer Reputation Rating
  • U.S. News: Judge/Lawyer Reputation Rating
  • Washington & Lee Citation Ranking
  • Washington & Lee Impact Factor
  • Washington & Lee Combined Rating

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July 31, 2017 in Legal Education, Scholarship | Permalink | Comments (0)

The IRS Scandal, Day 1544:  How Lois Lerner Begat Robert Mueller

IRS Logo 2Wall Street Journal:  Mueller Is Trumping Congress, by William McGurn:

Did Congress learn anything from Lois Lerner? Judging from Capitol Hill’s self-abasing deference to Special Prosecutor Robert Mueller, the answer is no.

You remember Ms. Lerner. She was the official at the center of an Internal Revenue Service effort that denied conservative political advocacy groups tax-exempt status, or at least held up approval long enough that these groups could not be a factor in the 2012 election.

Back when Republicans were holding hearings on the matter, time and again they were lectured not to do anything that might affect the FBI’s investigation — which eventually ended with no charges against anyone. Though Ms. Lerner was found in contempt by the House for her refusal to testify, it proved all for show.

The tip-off came when then-Speaker John Boehner, rather than use Congress’s inherent contempt power to jail Ms. Lerner until she talked, opted for classic swamp symbolism — by passing the buck to an Obama Justice Department everyone knew would never prosecute her.

The result? Ms. Lerner avoided having to answer any hard questions. The IRS merrily continued to lose or destroy crucial documents. And John Koskinen, the awful replacement IRS commissioner who stonewalled and misled, remains in office.

The Lois Lerner fiasco offers a sobering lesson for a Congress whose various committees are holding hearings on Russia’s intervention in last year’s elections as Mr. Mueller investigates the same. While Mr. Mueller’s office is a watered-down version of Ken Starr’s or Lawrence Walsh’s , it remains true that special prosecutors corrupt even if they don’t corrupt as absolutely as independent counsels. The main headlines of the past week — Is Donald Trump attempting to undermine Mr. Mueller? Will Trump Fire Mueller? — all speak to the challenge a special prosecutor poses to the constitutional authority of the president.

Far less scrutiny has been devoted to the challenge Mr. Mueller poses to the authority of the legislative branch. In this case, ironically, the challenge stems less from the aggressiveness of the special prosecutor than from the meekness of Congress. In between their public tributes to Mr. Mueller’s sterling character, too many in Congress seem to worry more about how they might be affecting his investigation than about what his investigation might be doing to theirs.

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July 31, 2017 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

TaxProf Blog Weekend Roundup

Sunday, July 30, 2017

NY Times: Leadership Lessons From Nancy Zimpher (My Former Boss)

ZimpherNew York Times, Nancy L. Zimpher on Setting a Bold Vision:

This interview with Nancy L. Zimpher, chancellor emeritus of the State University of New York (SUNY) [and former President, University of Cincinnati, and former Chancellor, University of Wisconsin-Milwaukee], was conducted and condensed by Adam Bryant.

What are some leadership lessons you’ve learned over your career?

To me, vision is most important. If you really know where you’re going, and you have a clear vision for the institution, that can be really powerful. Over the course of my career, I have successfully articulated a vision three times over.

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July 30, 2017 in Legal Education | Permalink | Comments (0)

Summer Reading: The Fangs Of Freelance (Fred, The Vampire Accountant, Book 4)

FangsDrew Hayes is the author of numerous science fiction and fantasy novels, including a series of books about Fred, the Vampire Accountant.  The fourth book in that series — The Fangs of Freelance (Fred, the Vampire Accountant Book 4) — was published this week.  The first book in the series — The Utterly Uninteresting and Unadventurous Tales of Fred, the Vampire Accountant — was published in 2014.

In this blog post, David Gamage (Indiana) interviews Drew Hayes about Fred’s tax accounting practice, and about why members of the tax law and policy community looking for a fun, guilty-pleasure read might want to check out the Fred series of books.

Q:  How did Fred end up as a vampire accountant?  Why do supernatural creatures need accounting services in your novels?

A:  Fred was always an accountant, but the vampire thing was an unexpected turn in the road. I won't go much into how that happened, since it's covered in the novels. Suffice it to say that upon discovering his new condition, Fred opted to adapt how he did business, rather than try and learn a whole new trade. As for what parahuman creatures need accounting for: pretty much the same as humans. Anyone running a small business, dealing with multiple revenues streams, or, of course, in need of a break on their taxes.

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July 30, 2017 in Book Club, Tax | Permalink | Comments (1)

Should The Government Continue To Exempt Churches From Taxation?

J. Michael Martin (Vice President & Legal Counsel, Evangelical Council for Financial Accountability), Should the Government Be in the Business of Taxing Churches?, 29 Regent U. L. Rev. 309 (2017):

While some legal scholars have suggested the legitimacy of church tax exemption may be on the decline in the modern era, this Article offers reminders of the constitutional, historical, and public policy rationales that have supported church tax exemption since the establishment of our federal government. Ultimately, it contends that protection for religious freedom guaranteed by the Framers of the Constitution precludes the federal government from levying taxes on churches, and furthermore, that the government may not constitutionally revoke the historic tax-exempt status of churches based on their religious nature.

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July 30, 2017 in Scholarship, Tax | Permalink | Comments (5)

The Top Five New Tax Papers

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

  1. [611 Downloads]  Family Limited Partnerships and Section 2036: Not Such a Good Fit, by Mitchell Gans (Hofstra) & Jonathan Blattmachr (Milbank, New York)
  2. [376 Downloads]  The Front Door Opens Wide for the Backdoor Roth IRA, by Philip Manns (Liberty) & Timothy Todd (Liberty)
  3. [306 Downloads]  The Rise and Fall of the Destination-Based Cash Flow Tax: What Was That All About?, by Daniel Shaviro (NYU)
  4. [216 Downloads]  The Case Against BEPS: Lessons for Coordination, by Mindy Herzfeld (Florida)
  5. [180 Downloads]  Formalizing the Code, by Sarah Lawsky (Northwestern)

July 30, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, July 29, 2017

This Week's Ten Most Popular TaxProf Blog Posts

Democrats Should Embrace Raising Taxes On Capital Income As Part Of Their 'Better Deal'

A Better DealWashington Post, Democrats’ ‘Better Deal’ for Workers Leaves a Tough Question Unanswered:

Leading Democratic politicians announced their economic agenda for next year's midterm elections on Monday, calling for measures to bring down prices for prescription drugs, control monopolies and help companies pay for training for their workers.

The documents distributed to reporters, however, mentioned taxes only in passing, glossing over what could be a crucial aspect of any Democratic platform in the coming years. Democrats can use tax policy to pay for their other proposals, to equalize incomes directly and to answer frustrated voters' questions about where the party really stands on the economy.

Democrats have frequently called for the rich to pay more in taxes, but some in the party are becoming dissatisfied with the solutions Democrats have put forward so far, which mainly involve untangling kinks and loopholes in the existing system and general, jack-of-all-trades hikes and surcharges.

To lessen inequality and to raise new revenue to fund broad, progressive new programs, senior Democratic policymakers have been talking about novel ideas for taxing the wealth of the richest Americans. Those plans could include a comprehensive tax on capital, a broad category of wealth that includes stocks, bonds, businesses, property and other assets.

“Progressives should be focused on how to fundamentally reform how we tax capital income in this country,” said David Kamin, who served as a special assistant to President Barack Obama on economic issues. ...


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July 29, 2017 in Congressional News, Tax | Permalink | Comments (1)

Thomas Haskell and the Risk/Reward of Interdisciplinarity

I learned from Al Brophy's post this morning that Rice University historian Thomas Haskell passed away. See Al's post for Haskell's contribution to the history of antislavery sentiment in the antebellum U.S. This is my tribute.

Professor Haskell wrote not just about history, but about the philosophy and the writing of history - historiography.  That work is relevant to anybody, including law professors, who attempts to cross-disciplinary boundaries. Law professors (including me) do it all the time, and the risk/reward is obvious. Disciplines are human-created categories. Professor Haskell's history of the rise of these categories in academic social science was The Emergence of Professional Social Science: The American Social Science Association and the Nineteenth-Century Crisis of Authority. Disciplines engender orthodoxies and received wisdoms - authority.  To succeed in an academic discipline, you need to be careful about challenging them (see Louis Menand, The Marketplace of Ideas: Reform and Resistance in the American University). 

If you are within the discipline, the likelihood you are coopted into the received wisdom or are pragmatic about testing the limits is obviously higher than if you are not. If you aren't in the discipline and do challenge the received wisdom, you stand a good chance of being taken as a dilettante. Hence, the risk/reward (even paradox) of interdisciplinarity.  Those most inclined to it must do it very, very well even they do not carry a professional credential (Ph.D.) for the field into which they stray. 

The story of Professor Haskell's own courage in testing the limits comes after the break.

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July 29, 2017 in Legal Education, News | Permalink | Comments (0)

These 7 Highly Taxed Companies Need Congress To Finally Act On Tax Reform

MarketWatch, These 7 Highly Taxed Companies Need Congress to Finally Act on Tax Reform:

Memo to Republicans in Congress: It’s time to move on.

Your efforts to strip insurance away from millions of Americans — I mean, reform Obamacare — are only making you look bad. And I’m not talking about the “mean” plan that the House passed that shows how many in the GOP lack basic compassion for their fellow Americans, or the infighting that’s making your party look directionless and weak-willed.

Honestly, as an investor, I could care less about all that. What I really care about is what you promised months ago: comprehensive tax reform....

Here are seven U.S. companies with tax rates of at least 35% that are hoping for your help:

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July 29, 2017 in Tax | Permalink | Comments (6)

Friday, July 28, 2017

Weekly SSRN Tax Article Review And Roundup

This week, Orly Mazur (SMU) reviews a new work by Zachary Liscow (Yale Law School) and William Woolston (Stanford University, Department of Economics),  How Income Taxes Should Change During Recessions, Tax Law Review, Forthcoming.

Mazur (2017-2)Economic recessions, a frequent occurrence in our history, are destructive in many respects. They cause wide-spread unemployment, a decline in economic growth, sinking asset values, fear and uncertainty, among other economic and social costs. Although economists generally agree that increased government spending can spur economic growth during a recession and alleviate this burden, the current literature does not sufficiently address how to design the spending so that it maximizes social welfare during a recession.

In their recent article, Liscow and Woolston (hereinafter, “LW”) make an important contribution to the literature by recommending two ways to improve fiscal policy design during a recession in the context of labor income taxes and related policies. Specifically, LW propose that Congress should (i) increase effective subsidies on the non-employed and (ii) subsidize employers rather than employees during recessions.

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July 28, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Legal Education Roundup

Tax Policy In The Trump Administration

The Tax App: Eliminating Tax Returns Entirely

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

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

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

More Perspectives On The 20% Increase In June 2017 LSAT Test-Takers

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

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

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

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

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

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

Thursday, July 27, 2017

A Hamilton Birthday

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


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

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

Trump, Congress Reach Agreement On 'Skinny Tax Reform'

GOP Statement on Tax Reform:

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

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

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

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

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

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

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

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

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

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

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

The Collateral Costs Of Diversity In Legal Education

SpearIt (Texas Southern), Not for Free: Exploring the Collateral Costs of Diversity in Legal Education, 48 Pac. L. Rev. 887 (2017):

This essay examines some of the institutional costs of achieving a more diverse law student body. In recent decades, there has been growing support for diversity initiatives in education, and the legal academy is no exception. Yet for most law schools, diversity remains an elusive goal, some of which is the result of problems with anticipating the needs of diverse students and being able to deliver. These are some of the unseen or hidden costs associated with achieving greater diversity. Both law schools and the legal profession remain relatively stratified by race, which is an ongoing legacy of legal education’s origins as a project dominated by white male elites predominantly serving white male clients. Today’s law schools still lack in diversity, but major developments are increasingly changing student demographics.

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July 27, 2017 | Permalink | Comments (2)

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

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

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

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

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

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

Wednesday, July 26, 2017

Anderson: Save Law Students Tens of Millions of Dollars By Opting Out Of New Casebook Editions

Following up on my previous post, Opting Out Of New Editions Of Casebooks And Saving Students 97 Cents On The Dollar:  Robert Anderson (Pepperdine), Save Law Students Tens of Millions of Dollars: Opt Out of New Casebook Editions:

Two years ago I blogged about my decision to use an older edition of my Contracts casebook instead of the newer edition. This saved my contracts students about $200 each which totaled about $10,000 for the class. The law of Contracts changes only glacially, and the students miss out on little by using an older edition. ... This year I am doing the same thing with my Corporations class. ...&

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July 26, 2017 in Legal Education | Permalink | Comments (8)

Boni-Saenz: Distributive Justice And Donative Intent

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

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

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

ABA Considers Raising 15 Credit Cap On Distance Learning Accreditation Standard

ABA Section On Legal Education (2016)ABA Journal, Distance Learning Standards Under Consideration by ABA Legal Ed Section:

Where and how accredited law schools offer courses and ways in which existing rules on those topics might be modified were discussed [July 15] by the standards review committee of the ABA’s Section of Legal Education and Admissions to the Bar.

Accreditation rules under consideration for revision include Standard 307, which addresses programs of domestic law schools held outside the United States, and Standard 306, which sets rules for distance learning. Feedback was the focus of the meeting, and the committee will meet again in October for further discussion.

July 26, 2017 in Legal Education | Permalink | Comments (0)

Columbia Journal Of Tax Law Publishes New Issue

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

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

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

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

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

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

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

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

Pepperdine Bar Exam Lunches

I was delighted to take part yesterday in a wonderful Pepperdine tradition: providing lunch to our grads who are taking the California bar exam in Ontario.

Bar Lunch 1

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July 26, 2017 in Legal Education | Permalink | Comments (5)

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

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

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

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

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

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

Tuesday, July 25, 2017

Lawsky:  Formalizing The Tax Code

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

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

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

Advice For Professors For The First Class Of Their Law School Course

Emily Grant (Washburn), Beyond Best Practices: Lessons From Tina Stark About the First Day of Class, 95 Or. L. Rev. 397 (2017):

This Article reviews and expands the literature on best practices in a narrow subset — the first day of class. At the same time, it seeks to convey words of wisdom from one of the most well-known and highly-regarded legal educators: Tina Stark, a giant in transactional drafting. The first day of any law school class can be fraught with tension and nerves, even for professors. This Article presents advice from Professor Stark, supplemented with guidance from best practices research, so that professors can take advantage of the opportunities that the first day of class offers to set the tone for a successful semester.

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July 25, 2017 | Permalink | Comments (2)

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

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

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

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

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

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

The Dan Markel Murder Case: Katherine Magbanua Turns Down A Plea Deal, Judge Says Third Party (Not The Adelsons) Is Paying Her Legal Fees

Markel SuspectsAbove the Law, The Dan Markel Case: Katherine Magbanua Turns Down A Deal:

Who's paying Katie Magbanua's legal fees will remain a mystery, and her trial date has been set. ...

[A]s reported by the Tallahassee Democrat:

A third party is paying Katherine Magbanua’s legal fees, but it’s not the former in-laws of the man she is suspected of being involved with killing, according to her attorneys and a Leon County Circuit judge. ...

Here’s another thing I’m wondering: how deeply did Judge Hankinson delve into the explanation proffered by Magbanua’s counsel? One could imagine a situation where the Adelsons paid money to a third party, and the third party then paid DeCoste and Kawass, without telling DeCoste and Kawass about the Adelson connection. This would then allow DeCoste and Kawass to maintain — honestly, enthusiastically, and even indignantly — that they aren’t being paid by the Adelsons. ...

What prompted the prosecution’s curiosity about legal fees? As prosecutor Georgia Cappleman told WCTV after the hearing, “It’s a little suspicious that [Magbanua] has no money to pay, yet she’s hired an expensive legal team that’s housed in the same building as Mr. [Charlie] Adelson’s attorneys.” ... 

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July 25, 2017 in Legal Education | Permalink | Comments (4)

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

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

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

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

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

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

Law School Rankings By Student Quality (LSAT And UGPA)

2018 U.S. News Law 2Christopher J. Ryan Jr. (Vanderbilt) & Brian L. Frye (Kentucky), A Revealed-Preferences Ranking of Law Schools,  69 Ala. L. Rev. 495 (2017):

The U.S. News & World Report “Best Law Schools Rankings” define the market for legal education. Law schools compete to improve their standing in the rankings and fear any decline. But the U.S. News rankings incite contention, because they rely on factors that are poor proxies for quality like peer reputation and expenditures per student. While many alternative law school rankings exist, none have challenged the market dominance of the U.S. News rankings. Presumably the U.S. News rankings benefit from a first-mover advantage, other rankings fail to provide a clearly superior alternative, or some combination of the two.

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July 25, 2017 in Law School Rankings, Legal Education | Permalink | Comments (1)

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

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

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

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

NY Times:  ‘A Bleak Picture’ For Women Trying To Rise At Law Firms

NY Times Dealbook (2013)New York Times Deal Book:  ‘A Bleak Picture’ for Women Trying to Rise at Law Firms, by Elizabeth Olson:

Even as more women add a law degree to their résumés, carving out a successful career at a law firm remains an uphill endeavor.

While initiatives and conferences to expand the number of women who are equity partners at law firms are something of a cottage industry, progress for women is, at best, static, according to the “2017 Law360 Glass Ceiling Report,” released on Monday by the legal publication Law 360.

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July 25, 2017 in Legal Education | Permalink | Comments (3)

Monday, July 24, 2017

AALS Bans Conferences In Texas Due To Immigration, Bathroom Bills

AALS (2019)Texas Lawyer, Law School Association Ditches Texas Over Immigration, Bathroom Bill:

The American Association of Law Schools is moving a 2018 conference from Austin to Chicago and will no longer hold meetings in Texas because of the state's new controversial immigration law and a proposed "bathroom bill" that restricts restroom access for transgender people.

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July 24, 2017 in Legal Education | Permalink | Comments (5)

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

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

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

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

California Bar Cut Score, Lawyer Salaries Are Second Highest In Country: Anti-Competitive Or Pro-Consumer Protectionism?

California Bar ExamFollowing up on my previous post (links below):  Michael Simkovic (USC), Is California’s Bar Examination Minimum Passing Score Anti-competitive?:

The deans of almost all ABA approved California law schools have jointly expressed concerns that California’s minimum passing score (‘cut score’) on the nationally uniform, multiple choice, Multi-State Bar Exam bar examination is excessively high.

These leaders of legal education note that California has a higher cut score than any state except Delaware, no justification has been provided for this unusually high cut score, and some parts of California may have a shortage of lawyers.  Moreover, although law graduates from California score better on the MBE than the national average, they are less likely to pass the bar exam because of California’s unusually high cut score. The case for bringing California’s cut score into line with those of other leading legal jurisdictions such as New York has been most forcefully stated by UC-Hastings Dean David Faigman. 

Amid concerns about possible anti-trust lawsuits against the State Bar, the Supreme Court of California has agreed to supervise the state bar of California and may set a lower bar cut score.

High cut scores are not the only signs of possible anti-competitive protectionism in California. California is among the few states that, without exception, forces experienced attorneys licensed in other states to sit for reexamination prior to relicensing. ...

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July 24, 2017 in Legal Education | Permalink | Comments (5)

Number Of Law School Graduates Sitting For California Bar Exam Surges 11%, To Highest Level In More Than A Decade

California Bar, Who Says California's Bar Exam Is Too Tough? Would-be California Lawyers Flock to Take July Bar Exam:

Over the last year California’s bar exam has been scrutinized and vilified. But that hasn’t stopped a crush of would-be Golden State lawyers from registering for the latest crucible, which starts Tuesday.

Applications to take the July bar exam topped 10,000 this year — an increase of more than 1,000 above July 2016’s numbers, according to figures released by the state bar. Requests to take the general bar exam are up by 499 to 7,981. The number of out-of-state lawyers who applied to take next week’s test surged to 2,051, up from 1,549 this time last year.

The application rush may be due to the fact that this year’s exam is the first to be held over two days instead of the traditional three.

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July 24, 2017 in Legal Education | Permalink | Comments (0)

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

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

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

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

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

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

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

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

TaxProf Blog Weekend Roundup

Sunday, July 23, 2017

McIntyre & Simkovic:  Timing Law School

Frank McIntyre (Rutgers) & Michael Simkovic (USC), Timing Law School, 14 J. Empirical Legal Stud. 258 (2017):

We investigate whether economic conditions at labor market entry predict long-term differences in law graduate earnings. We find that unemployment levels at graduation continue to predict law earnings premiums within 4 years after graduation for earners at the high end and middle of the distribution. However, the relation fades as law graduates gain experience and the difference in lifetime earnings is moderate. This suggests that earnings figures from After the JD II and III — which track law graduates who passed the bar exam in 2000 — are likely generalizable to other law cohorts because these studies are outside the window when graduation conditions predict differences in subsequent earnings.

Figure 2

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July 23, 2017 in Legal Education, Scholarship | Permalink | Comments (4)