Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Taxation And Law And Political Economy By Bearer-Friend, Glogower, Kleiman & Wallace

This week, Hayes Holderness (Richmond) reviews Jeremy Bearer-Friend (George Washington; Google Scholar), Ari Glogower (Ohio State; Google Scholar), Ariel Jurow Kleiman (Loyola-L.A.; Google Scholar), & Clinton G. Wallace (South Carolina; Google Scholar), Taxation and Law and Political Economy, 83 Ohio St. L.J. ___ (2022).

One bit of folk wisdom among tax professors is that many students interested in law careers addressing social inequities will fail to consider tax law as an area of practice in favor of something like criminal law. I suppose the idea is that tax law is just about numbers and math and making sure that rich people and corporations don’t pay taxes. With such a framing, one can understand the lack of appeal to this set of students. Of course, if these students are lured into a tax class, it seems they are often delightfully surprised at the role taxation can play in shaping social policy. So how did tax law earn its muted reputation, and can or should that reputation change?

Though their article is not about how to get more students to enroll in their classes, Jeremy Bearer-Friend, Ari Glogower, Ariel Jurow Kleiman, and Clint Wallace have answers to these questions. 

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Monroe's Improvisation And Forgotten Taxpayers In Partnership Tax

This week, Hayes Holderness (Richmond) reviews Andrea Monroe (Temple), Making Tax Law Work: Improvisation and Forgotten Taxpayers in Partnership Tax, 55 Mich. J. L. Reform ___ (2021):

When I teach Partnership Taxation, I like to introduce the subject by telling my students that there are really only two principles behind Subchapter K: 1) do what you want, and 2) don’t screw the government. I explain that the course will be an exercise in reconciling those two principles, and it will probably be the most difficult exercise in tax law that they encounter in law school. Until reading Andy Monroe’s forthcoming article, I was certain that the difficulty of Partnership Taxation was merely the unfortunate side effect of a tax regime designed to respect taxpayer choices. Now I’m not so sure, and worse, I’ve certainly been complicit in promoting this narrative.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Saito's Tax Coordination

This week, Hayes Holderness (Richmond) reviews Blaine G. Saito (Northeastern), Tax Coordination, 38 Ga. St. U. L. Rev. ___ (2022):

The idea of tax expenditures—those provisions of the tax law not in line with the normative base—has intuitive appeal. Of course the tax law is imperfect, but if we pinpoint the offending provisions, we can approach a more perfect code. Now where did we put that normative baseline? Harsh and compelling critiques of the tax expenditure concept essentially accuse it of masking personal preferences regarding the desirability of tax provisions, yet the concept apparently cannot be so easily killed off.

Though I may be stretching the article too far in this claim, Blaine Saito’s forthcoming article, Tax Coordination, offers an alternative way to think about tax expenditures. They are those provisions of the tax law with effects on social policy. Further, they are those provisions of the tax law that could benefit from interagency coordination. The thrust of Saito’s argument is that the Internal Revenue Service and Treasury should be encouraged to play nicer with others, but in this argument lies a lesson about tax expenditures: they are those provisions of the tax law that the tax authorities are not well-suited to administer alone.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Pareja's The Role Of Congressional Procedure In Severability Doctrine

This week, Hayes Holderness (Richmond) reviews Mary Leto Pareja (New Mexico), California v. Texas: The Role of Congressional Procedure in Severability Doctrine, 46 Seton Hall Leg. J. (2021).

The Affordable Care Act and its controversial individual mandate are back in the headlines again as the Supreme Court considers the effect of reducing the tax for not maintaining health insurance to a zero rate. Surely, no reader of this blog will have forgotten Chief Justice Roberts’ weaving opinion in the 2012 NFIB case. Applying a “functional” approach, the opinion explained that the ACA’s “penalty” for not having health insurance was properly characterized as a “tax” for constitutional purposes. This interpretation ensured the constitutionality of the provision under Congress’ tax power, as it would not have been constitutional under Congress’ authority to regulate interstate commerce.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Choi's How Does Chevron Shape Agency Rulemaking?

This week, Hayes Holderness (Richmond) reviews Jonathan H. Choi (Minnesota), How Does Chevron Shape Agency Rulemaking? An Empirical Study, 38 Yale J. Reg. ___ (2021):

One would be hard-pressed to find a tax lawyer without knowledge of 1984’s Chevron case, which established a deferential standard for judicial review of agency rulemaking—as long as the rule is a reasonable interpretation of an ambiguous statute, courts should defer to the judgment of the agency. Most tax lawyers presumably also are familiar with 2011’s Mayo decision, which affirmed that tax regulations were subject to the same Chevron standard as regulations in other areas of law. Until Mayo, tax was assumed to be exceptional in this realm, with certain regulations entitled to less deference than Chevron would have provided.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Walker's Tax Complexity And Technology

This week, Hayes Holderness (Richmond) reviews David I. Walker (Boston University), Tax Complexity and Technology:

Tax preparation platforms like TurboTax and TaxAct offer taxpayers a (relatively) easy way to complete and file their tax returns. Tax preparation businesses like H&R Block similarly ease the burden on taxpayers of completing and filing tax returns; those businesses also use technology to provide their services. Cumulatively, over 90% of individual taxpayers do their taxes with the help of these platforms or businesses, as opposed to filling out the returns themselves. Technology appears to be a tax simplification salve for the vast majority of individual taxpayers.

Not quite so fast, argues David Walker, in his draft article, Tax Complexity and Technology. While technology has undeniably simplified the return process for many, it has also helped mask the inner workings of the tax laws. Tax preparation platforms and businesses can operate like “black box” algorithms: just plug in the data and get a nice round number; don’t worry about how the number is reached. These black boxes allow for the complexity of the tax laws to grow.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Mitigating Housing Instability During A Pandemic

This week, Hayes Holderness (Richmond) reviews Michelle D. Layser (Illinois), Edward De Barbieri (Albany), Andrew Greenlee (Illinois), Tracy Kaye (Seton Hall), & Blaine G. Saito (Northeastern), Mitigating Housing Instability During a Pandemic:

The COVID-19 pandemic continues to wreak havoc on people’s lives, both from a health perspective and an economic perspective. Congress is currently considering additional federal relief packages to support individuals across the country, and states and localities also weigh how they can help their people. Many have found these government responses lacking so far, and Michelle Layser, Ted De Barbieri, Andrew Greenlee, Tracy Kaye, and Blaine Saito add an important and powerful critique in their draft article: Not enough attention has been paid to housing instability (a particularly salient critique to yours truly, whose hometown carries the ignominious rank of second most evicting large city in the country). Policymakers would be wise to learn from the authors’ analysis and heed their advice.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews New Technologies and the Evolution of Tax Compliance

This week, Hayes Holderness (Richmond) reviews James Alm (Tulane), Joyce Beebe (Rice), Michael S. Kirsch (Notre Dame), Omri Y. Marian (UC-Irvine) & Jay Soled (Rutgers), New Technologies and the Evolution of Tax Compliance, 39 Va. Tax Rev 287 (2020):

Ask almost any waiter and they will say that cash tips are best. “Why?,” a first time diner might ask. The waiter probably will not respond, “information,” but information is likely the root of the answer—or rather, control of information. Yes, there is some convenience to being paid immediately with cash. However, being fairly confident that diners will not tell the restaurant or the Internal Revenue Service how much they tipped, waiters control that information and can report it as they see fit. And when one focuses on waiters as taxpayers, their control over that information becomes problematic because that control enables the waiters to engage in tax evasion.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Mason's What The CJEU’s Hungarian Cases Mean For Digital Taxes

This week, Hayes Holderness (Richmond) reviews Ruth Mason (Virginia), What the CJEU’s Hungarian Cases Mean for Digital Taxes:

Long before the current crisis ramped up fiscal pressure on nations and states, governments have sought to tax the foreigner rather than those at home. Coordination between nations and states has sought to limit the ability of governments to engage in such protectionist or discriminatory taxation; the European Union’s protection of fundamental freedoms and the United States’ Commerce Clause (at least in its dormant capacity) serve as examples. As governments begin considering and adopting digital taxes, such as France’s Digital Services Tax, these coordinated efforts may prevent those governments from utilizing those taxes in protectionist ways by discriminating against out-of-state taxpayers. Indeed, France’s Digital Services Tax has been challenged for exactly that reason because the tax appears to target United States companies while failing to capture most French companies.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Brunson's Donor-Advised Funds And The Deferral of Charity

This week, Hayes Holderness (Richmond) reviews Sam Brunson (Loyola-Chicago), 'I’d Gladly Pay You Tuesday for a (Tax Deduction) Today': Donor-Advised Funds and the Deferral of Charity, 55 Wake Forest L. Rev. ___ (2020).

Perhaps one of the most entrenched deductions available under the Internal Revenue Code is the deduction for contributions to charitable organizations. Though the deduction has its opponents, it just feels right to the national psyche (perhaps too right, making it hypersalient, as Lilian Faulhaber exposed in a 2012 article). The broad appeal of the deduction may lie in its many potential justifications, such as relieving the government of spending it would otherwise have to do, facilitating civic engagement by letting the donor direct government funds, respecting the notion that spending on others should not be considered personal consumption, and incentivizing the socially beneficial behavior of helping others. In his forthcoming article, Sam Brunson highlights the failure of donor-advised funds to live up to the high goals of the charitable deduction.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Drumbl's Tax Attorneys As Defenders Of Taxpayer Rights

This week, Hayes Holderness (Richmond) reviews Michelle Lyon Drumbl (Washington & Lee), Tax Attorneys as Defenders of Taxpayer Rights, 91 Temple L. Rev. ___ (2019):

Tax attorneys serve many purposes. Two examples have been recently explored in this review series: tax attorneys may provide de facto insurance to their clients or may serve as agents of social justice. To these examples, Michelle Drumbl’s forthcoming essay adds another: tax attorneys defend taxpayer rights. One might be tempted to respond, “Well, of course they do; each tax attorney’s job is to make sure her clients only pay the tax they owe.” The strength of Drumbl’s essay is not to contradict this observation or to dwell on it, but to expose it as too narrow a view of the tax attorney’s function.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Crawford's Magical Thinking And Trusts

This week, Hayes Holderness (Richmond) reviews Bridget J. Crawford (Pace), Magical Thinking and Trusts, 50 Seton Hall L. Rev. ___ (2019).

Wealth inequality is a major concern in today’s United States. As wealth concentrates among the super-wealthy, lawmakers, academics, and commentators have proposed ways to diffuse that wealth, often through tax reform. Wealth remains concentrated in part through the use of legal rules and entities, perhaps in ways that lead to unintended results. Here there be trusts. Trusts—particularly family trusts—have long been a major tool of wealth conservation and potential tax avoidance. So when the Supreme Court heard this year’s Kaestner case questioning North Carolina’s authority to tax the income of a family trust, many hoped that the Justices would help dismantle the tax avoidance tool by blessing the state’s taxing authority.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Abreu & Greenstein's Tax: Different, Not Exceptional

This week, Hayes Holderness (Richmond) reviews Alice Abreu (Temple) and Richard Greenstein (Temple), Tax: Different, Not Exceptional, 71 Admin. L. Rev. __ (2019):

Tax is special. There is nothing quite like it. It has its own lingo, bar sections, courts, constitutional provisions, and even blogs. Most United States citizens are keenly aware of tax; indeed, there might not have been a United States without certain taxes. But many areas of law can make similar claims. Most citizens are aware of the criminal law; specialized blogs, bar sections, and courts exist for many types of law; and apparently “trolls” are a concern in patent law. So tax is special, but is it truly in a league of its own, different in kind from other areas of law? Is tax exceptional? “No,” argue Alice Abreu and Richard Greenstein, in a thought-provoking piece that questions the very meaning of “exceptional” in this context.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Afield's Social Justice And The Low-Income Taxpayer

This week, Hayes Holderness (Richmond) reviews W. Edward Afield (Georgia State), Social Justice and the Low-Income Taxpayer, 64 Vill. L. Rev. __ (2019).

Many, if not most, tax professors and practitioners have been asked whether what we do is only about helping high-income individuals or businesses get out of paying taxes. Instead of offering the customary eye-roll, Ted Afield provides a thoughtful and compelling answer in Social Justice and the Low-Income Taxpayer. Afield’s article provides a detailed exploration of the role of low-income taxpayer clinics (LITCs) in providing clients with tax justice, and thus by extension, social justice. He then advocates for LITCs to be empowered to do more to improve social justice. This important piece should serve as a pillar for any efforts to support and expand LITCs across the country.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Glogower's A Constitutional Wealth Tax

This week, Hayes Holderness (Richmond) reviews Ari Glogower (Ohio State), A Constitutional Wealth Tax:

As media coverage, politicians, commenters, and last week’s SSRN Roundup indicate, wealth taxation is hot right now. As various arguments emerge about the constitutionality of a wealth tax in the U.S., Ari Glogower presents a new view on the question in A Constitutional Wealth Tax. At the core of his argument, Glogower invokes substance-over-form reasoning: wealth is already constitutionally taxed indirectly through the income tax, so there should not be a problem taxing wealth directly.

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Azam & Mazur's Cloudy With A Chance Of Taxation

This week, Hayes Holderness (Richmond) reviews Rifat Azam (Radzyner) & Orly Mazur (SMU), Cloudy with a Chance of Taxation, 21 Fla. Tax Rev. ___ (2018):

The growth of cloud computing is one of the most significant commercial developments facing modern consumption tax regimes. The growth is significant in part for the problem it presents: tax regimes designed for the consumption of goods and services transferred in a physical world struggle to adapt to virtual transactions. Often the analysis of this problem has focused on the what and the where of cloud computing. Tax authorities often have difficulty characterizing cloud computing offerings as either goods or services, and that characterization can drive tax consequences. Additionally, given the virtual nature of cloud computing, it can be difficult to figure out where the consumption takes place (or even where the offering originates from) and thus who has the right to impose tax; how many places have you accessed Spotify from?

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Weekly SSRN Tax Article Review And Roundup: Holderness Reviews Kahn's GoTaxMe — Crowdfunding And Gifts

This week, Hayes Holderness (Richmond) reviews Jeffrey H. Kahn (Florida State), GoTaxMe: Crowdfunding and Gifts, 22 Fla. Tax Rev. ___ (2019).

What is a “gift”? Webster’s Dictionary defines “gift” as “something voluntarily transferred by one person to another without compensation” (I kid, I kid). In GoTaxMe: Crowdfunding and Gifts, Professor Jeffrey Kahn challenges the reader to define “gift” for federal income tax purposes in a more robust fashion than simply as transfers made with detached and disinterested generosity. Anyone who has taken a basic federal income tax class knows that § 102 excludes gifts from gross income but fails to define what gifts are. The Supreme Court filled this gap with the Duberstein “detached and disinterested generosity” standard, noting that in determining whether any particular transfer is a gift, “the most critical consideration . . . is the transferor’s ‘intention.’” Professor Kahn uses the example of the (currently) $448,162 donated by 11,709 people to former FBI agent Peter Strzok through the crowdfunding site GoFundMe.com to argue that the Duberstein standard’s focus on the transferor’s intention fails at the edges.

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