ABA Tax Section 2024 May Meeting

The ABA Tax Section held its 2024 May Tax Meeting (program) last Thursday-Saturday. A highlight was Friday's Teaching Taxation program on Taxing Litigation Finance:

Third-party litigation funding has rapidly grown in recent years. Policy discussion on the proper tax treatment of the parties involved, however, has fallen by the wayside. The problem is acute in classifying litigation financing contracts as nonrecourse loans, immediate sales, or variable prepaid forward contracts, all of which have a discrete impact on the parties’ timing and character of income. Nonetheless, tax authorities have chosen to remain silent on this topic, except for an unhelpful IRS memorandum released in 2015. The U.S. Tax Court’s 2020 decision in Novoselsky v. Commissioner (T.C. Memo. 2020-68, May 28, 2020), the first modern reported case to directly address the tax treatment of a litigation finance contract, has not resolved taxpayer uncertainty. This panel will examine various tax issues in consumer and commercial litigation finance, including preferred tax position by the beneficiaries (lawyers and litigants) and the funders, and the character and timing of income. The panel will also discuss the Novoselsky case, the use of forward contracts, potential compliance issues, and the areas of uncertainty.

• Young Ran (Christine) Kim (Cardozo; Google Scholar) (moderator)
• Mark Leeds (Mayer Brown, New York)
• Eric Schuller (The Alliance for Responsible Consumer Legal Funding)
• Matthew Stevens (EY, Washington, D.C.)
• Mohamed Sweify (Hinshaw & Culbertson, New York)

Other Tax Profs with speaking roles included:

• Does the Civil Rights Act of 1866 Prevent Charities from Advancing Civil Rights?: Roger Colinvaux (Catholic University) 
• Important Developments: Jessica Harris (American)
• The Inequality of Tax Cuts: A Discussion on the Effects of Tax Policy on Wealth Redistribution: Bridget Crawford (Pace; Google Scholar), Anthony Infanti (Pittsburgh; Google Scholar), Goldburn Maynard (Indiana-Kelley; Google Scholar), Phyllis Taite (Oklahoma) 
• LITCs, Pro Bono, and Calendar Call Programs in the Tax Court: Where We Have Been: Nancy Abramowitz (American), Keith Fogg (Harvard), Caleb Smith (Minnesota)
• Math Error: Amy Spivey (UC-San Francisco) 
• Policy Implications of Recent Proposals to Divvy up the Tax Base: Lilian Faulhaber (Georgetown; Google Scholar), Annette Nellen (San Jose State; Google Scholar) 
• Shaken, Not Stirred: The Role of Agency in U.S. International Taxation: Alan Appel (New York Law School) 
• The Tax Court’s Collections Jurisprudence: Bryan Camp (Texas Tech; Google Scholar)
• Taxation's Role in Saving the Climate: Roberta Mann (Oregon) 
• Unlocking the Synergy of Tax, DEI, and ESG: Roberta Mann (Oregon) 
• Without Which It is Not: Why Implementing DEI is a Sine Qua Non in the Legal Profession Today: Anthony Infanti (Pittsburgh; Google Scholar)

Bloomberg coverage of the meeting:

• Energy Tax Credit Guidance Comes as Transfer Market Takes Off
• Erroneous Covid Claims Reach $1 Billion in IRS Opt-In Program
• Finalized IRS Estate Tax Regulations Expected This Summer
• IRS Begins Work to Update Whistleblower Retaliation Protections
• IRS Considers Changes to Donor-Advised Fund Proposed Regulations
• IRS Proposed Rules on Foreign Trusts to Be Published Next Week
• IRS Sends Out 180,000 Reminders to Taxpayers Who Need to File
• Taxpayer Advocate Sees Rise in Requests for Covid Credit Help
• Treasury Explains Tweak to ‘Look-Through’ Approach on REITs
• Treasury Mulling Global Minimum Tax, US Loss Rules Interaction
• Work Wrapping Up on Global Transfer Pricing Rule Definitions
• Wyden to Revise Draft Legislation Tightening Partnership Rules