TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Friday, May 17, 2019

Scott Turow's 'One L' To Be A TV Series

One LVariety, Adaptation of Scott Turow’s ‘One L’ in Early Development at Freeform:

A television adaptation of Scott Turow’s novel One L is in “very early” development at Freeform, Variety has learned.

The eponymous series “follows five uniquely gifted students who bond as they navigate the perils of their first year of law school and come to terms with who they want to be, while grappling with their complicated pasts,” according to the network. ...

The nonfictional One L: The Turbulent True Story of a First Year at Harvard Law School, was first published in 1977.

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May 17, 2019 in Legal Education | Permalink | Comments (3)

Estate Planning Considerations For Sports Team Owners

Duncan Ternus (J.D. 2020, Texas Tech), Winning Starts at the Top: Estate Planning Considerations for the Modern Day Sports Team Owner:

Professional sports team owners need to carefully plan their estates in order to win on and off the field. These individuals are arguably the most important figures in a professional sports team because their actions affect everyone associated with the team, from players to fans. Team owners represent some of the wealthiest people in America and have large estates that often include other business ventures besides their sports teams. When team owners take inadequate estate planning steps, their estates are often forced to sell their teams in order to pay estate taxes. This in turn can lead to team instability or, worst case scenario from a fan’s perspective, a forced relocation of the team.

This comment examines some of the ways today’s professional sports team owners can plan their estates in order to not only continue their personal success but their team’s success as well. Federal estate taxes are the largest hurdle for team owners because the tax affects only the wealthiest of estates, and planning one’s estate to avoid these estate taxes is vital for a team owners’ success. The future of the federal estate tax remains to be seen under the Trump administration, which could lead to substantial gain for team owners should the tax be repealed altogether. Team owners also need to consider state estate taxes for the states in which they are domiciled.

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May 17, 2019 in Scholarship, Tax | Permalink | Comments (1)

Thursday, May 16, 2019

ABA To Vote Tomorrow On 75% Bar Passage Accreditation Standard

Shurtz: Long Term Care And the Tax Code: A Feminist Perspective On Elder Care

Nancy E, Shurtz (Temple), Long-term Care and the Tax Code: A Feminist Perspective on Elder Care, 20 Geo. J. Gender & L. 107 (2018):

Elder care is an increasingly important sector in the comprehensive health care matrix in the United States. It is a realm of particular import to women: women live longer, develop degenerative conditions at higher rates than men, and are more likely to receive and provide care. Women earn less income, possess less net wealth, and are far more likely to live in poverty. Public policies regarding elder care add to the increasing strain on women by systematically rejecting home-based caregiving labor as “legitimate” economic activity, rendering it unworthy of subsidized support. As a result, a secondary policy bias develops, favoring institutional (market) elder care over home-based options, which creates demonstrably poor health and life-quality results and adds substantial monetary costs to both affected individuals and taxpayers. This Article examines the state of elder care—especially in the long-term context—and its impact on the lives of women as both care recipients and caregivers.

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May 16, 2019 in Scholarship, Tax | Permalink | Comments (0)

Law Schools Help First-Gen Students

ABA Journal, Law School Group Helps First-Gen Law Students Get 'a Leg Up':

Some say that law school is a game, and you’re at a loss if you come in not knowing how it’s played.

“There are times when you don’t know how to associate with the people you’re associating with in the legal profession, and it can feel like a glass ceiling,” Cameron Chan, a second-year law student at Boston University, whose parents did not finish high school, told the school’s website.

He’s a member of First Generation Professionals, a law school group founded in 2017, which focuses on both mentoring and the “sometimes arcane rules of decorum,” according to the news release.

Pepperdine Law School, First Generation Students:

Pepperdine Law is excited to support students who are the first in their family to graduate from college. Through our "First Gen" initiatives, we strive to foster a community that establishes mentors, creates opportunities, and opens dialogue about what it means to be a First Gen law student.

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May 16, 2019 in Legal Education | Permalink | Comments (0)

TurboTax And H&R Block Saw Free Tax Filing As A Threat — And Gutted It

TurboTaxHRBlockProPublica, TurboTax and H&R Block Saw Free Tax Filing as a Threat — and Gutted It:

Despite signing a deal with the IRS that pledged they would help tens of millions of Americans file taxes for free, tax software giants Intuit, the maker of TurboTax, and H&R Block instead deliberately hid the free option and actively steered customers into paid products, according to an internal document and five current and former employees of the companies.

H&R Block explicitly instructs its customer service staff to push people away from its free offering, according to internal guidance obtained by ProPublica.

“Do not send clients to this Web Site unless they are specifically calling about the Free File program,” the guidance states, referring to the site with the company’s free option. “We want to send users to our paid products before the free product, if at all possible.”

Steering customers away from TurboTax’s truly free option is a “purposeful strategy,” said a former midlevel Intuit employee. For people who find TurboTax through a search engine or an online ad, “the landing page would direct you through a product flow that the company wanted to ensure would not make you aware of Free File.”

When the Free File program launched 16 years ago, it was extolled as the best sort of collaboration between government and private enterprise. With little cost to the IRS, the huge companies that dominate online tax preparation would help millions of Americans file their taxes for free. Intuit and the industry have spent millions lobbying to make the Free File program permanent because it contains a noncompete provision that restricts the IRS from creating its own free, online filing system.

But privately, the free filing option is seen for what it is: a threat to the companies’ profits.

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May 16, 2019 in Tax | Permalink | Comments (0)

Abreu: Tax 2018 — Requiem For Ability To Pay

Alice Abreu (Temple), Tax 2018: Requiem for Ability to Pay, 51 Loyola L.A. L. Rev. 61 (2018) (reviewed by Neal Buchanan (Florida) here):

Enactment of the TCJA was followed by a mad dash to understand its effects. The speed and process of enactment left no time for serious attempts to analyze whether the TCJA transforms the income tax system in any fundamental way. This Essay is a first step in that analysis. Although some of the most important changes I discuss are set to expire or phase out after 2025, understanding their policy implications is important, not only because they are the law now but also because Congress may extend them, perhaps indefinitely.

The TCJA has changed the way the tax system operationalizes the principles of horizontal equity and ability to pay, has brought the base of the regular tax closer to the base of the AMT, and has increased the number of tax provisions that have been promulgated in the form of standards, which will require the deployment of significant administrative and judicial resources before they can be implemented effectively. By removing consideration of taxpayers’ support obligations from the tax base (except as relevant to the determination of filing status in the case of taxpayers who might qualify for the statuses of head of household or surviving spouse), the TCJA has jettisoned the value of ability to pay. It has unmoored the tax base zero bracket from the poverty level and created a system in which two taxpayers with very different ability to pay as a result of support obligations will be taxed the same, and in which two taxpayers with the same ability to pay will be taxed differently. The TCJA has turned the concept of horizontal equity on its head. In some cases the tax base will even be the taxpayer’s gross income in its entirety, subjecting to taxation even the amount needed for minimal subsistence.

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May 16, 2019 in Scholarship, Tax | Permalink | Comments (1)

Death Of Ron Hjorth (University Of Washington)

Hjorth

Dear UW Law Community:
It is with great sadness that I announce the death of Dean Emeritus Roland L. Hjorth, the Garvey Schubert Barer Professor of Law, on Monday, May 6. He was 83.

While I only had the pleasure to meet with Ron a few times, I know he was a treasured colleague, mentor and friend. He was a visionary leader and legal scholar, as well as recognized expert in taxation, international law and litigation. His wisdom, legendary hospitality and kindness will be greatly missed.

A celebration of life service will be held at the law school later this summer, and more details will be shared as soon as they are available. In the meantime, please send condolences and correspondence to Ron’s daughter, Heather Hjorth, by email at heatherhjorth@gmail.com or by mail at 5636 NE Keswick Drive, Seattle, WA 98105-2856.

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May 16, 2019 in Legal Education, Obituaries, Tax | Permalink | Comments (1)

NY Times: Can The Racial Wealth Gap Be Closed Without Speaking Of Race?

New York Times op-ed:  Can the Racial Wealth Gap Be Closed Without Speaking of Race?, by Emily Badger:

Elizabeth Warren wants to offer down-payment assistance to home buyers in formerly “redlined” neighborhoods where the federal government once denied access to mortgages. Cory Booker would like to create “baby bonds” that would be worth more to children in poorer families, helping them one day to buy houses or other assets.

Both presidential candidates say their proposals would aid in narrowing the enduring black-white wealth gap in America. But neither policy attempts to do that in the most direct way possible — by steering benefits to African-Americans.

Their ideas, along with several others that scholars advocate, are facing a tricky problem today. There’s growing momentum on the left to address the racial wealth gap. But the prospects for race-based policies before the Supreme Court are unpromising, and that’s unlikely to change with five conservative justices. ...

Proponents concerned about the wealth gap instead must come up with policies that have the effect of disproportionately building wealth for African-Americans, without singling them out. ... 

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May 16, 2019 in Tax | Permalink | Comments (1)

Modeling the Internal Revenue Code In A Heterogeneous-Agent Framework: An Application To The TCJA

Rachel Moore & Brandon Pecoraro (Joint Committee on Taxation), Modeling the Internal Revenue Code in a Heterogeneous-Agent Framework: An Application to TCJA:

Macroeconomic models used for tax policy analysis often simultaneously abstract from two features of the US tax code: special tax treatment for preferential capital income, and the joint tax treatment of ordinary capital and labor income. In this paper, we explore the extent to which explicitly accounting for these tax details has macroeconomic implications within a heterogeneous-agent model.

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May 16, 2019 in Scholarship, Tax | Permalink | Comments (1)

Wednesday, May 15, 2019

NY Attorney General Questions NRA's Tax-Exempt Status Amidst Huge Payments To Insiders

NRA LogoNew York Times, At the N.R.A., a Cash Machine Sputtering:

As the gun rights group lavished pay and perks on its leaders and partners, fueling infighting, it increasingly relied on its own charity for funds. Tax experts have questions.

The tantalizing leaks have spilled out in the weeks since the National Rifle Association’s annual convention in Indianapolis devolved into civil war.

Amid anxiety over falling revenue and mounting legal trouble has come news that the gun group’s longtime chief executive, Wayne LaPierre, billed $275,000 for purchases at the Zegna luxury men’s wear boutique in Beverly Hills. Its largely ceremonial president, Oliver L. North, had a contract worth millions of dollars a year. And a litany of payments benefited prominent officials, like the $60,000 for advertising on a TV show featuring the rock musician and N.R.A. board member Ted Nugent.

But behind the internecine squabbling lie deeper financial problems. A review of tax records by The New York Times shows that, to steady its finances, the powerful lobbying group has increasingly relied on cash infusions and other transactions involving its affiliated foundation — at least $206 million worth since 2010.

The role of the foundation is among the issues being examined in a new investigation into the N.R.A.’s tax-exempt status by the New York attorney general, Letitia James. The N.R.A. and the charity received separate letters last month from Ms. James’s office ordering them to preserve pertinent records, according to several people who had seen them.

At issue for investigators, tax experts say, would be whether that money was being used for charitable purposes, as required by law, and not to help finance the N.R.A.’s political activities. ...

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May 15, 2019 | Permalink | Comments (0)

SEALS Workshops For Aspiring And Prospective Law Profs

SEALs Logo (2013)Each year, SEALS hosts a Prospective Law Teachers Workshop (PLTW), which provides intensive opportunities for VAPs, fellows, and practitioners to network and participate in mock interviews and mock job talks—prior to the actual teaching market. The Workshop also includes a luncheon and 1-on-1 sessions for candidates to receive faculty feedback on their CVs. This year’s Prospective Law Teachers Workshop will be held at Boca Raton Resort & Club in Boca Raton, Florida on Tuesday, July 30, and Wednesday, July 31, 2019. If you are interested in participating specifically in the Prospective Law Teachers Workshop, please send your CV, and a brief statement explaining your interest, to Professor Brad Areheart. Please also indicate when you are hoping to go on the teaching market. Applications are due by June 1, 2019. Past PLTW participants have secured tenure-track appointments at an impressive array of law schools.

Separate and apart from the Prospective Law Teachers Workshop, SEALS is offering a new workshop that is broader programming for anyone considering academia—even if one is earlier in the process. The Aspiring Law Teachers Workshop (ALTW) includes sessions on designing your teaching package, navigating the market as a nontraditional candidate, mapping academic opportunities, what’s in a job talk, crafting scholarship goals, the art of self-promotion, as well as a luncheon. You can peruse the programming, which will take place between Sunday, July 29-Tuesday, July 31, by searching “aspiring law teachers workshop” here.

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May 15, 2019 in Legal Education | Permalink | Comments (0)

Randall Kennedy: Harvard Betrays A Law Professor — And Itself

New York Times op-ed:  Harvard Betrays a Law Professor — and Itself, by Randall Kennedy (Harvard):

Misguided students believe that defending Harvey Weinstein makes Ronald Sullivan unfit to be their dean. Apparently the university agrees.

I have been a professor at Harvard University for 34 years. In that time, the school has made some mistakes. But it has never so thoroughly embarrassed itself as it did this past weekend. At the center of the controversy is Ronald Sullivan, a law professor who ran afoul of student activists enraged that he was willing to represent Harvey Weinstein.

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May 15, 2019 in Legal Education | Permalink | Comments (6)

IRS Seeks Grant Applications For Funding Low Income Taxpayer Clinics

LITC

The IRS has announced (IR-2019-83) that it is accepting grant applications through June 17 for Low Income Taxpayer Clinics for the 2020 grant cycle (Jan. 1 - Dec. 31, 2020):

The LITC Program is a federal grant program administered by the Office of the Taxpayer Advocate at the IRS, led by the National Taxpayer Advocate, Nina E. Olson. Under Internal Revenue Code (IRC) Section 7526, the IRS awards matching grants of up to $100,000 per year to qualifying organizations to develop, expand or maintain an LITC.  An LITC must provide services for free or for no more than a nominal fee.

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May 15, 2019 in IRS News, Tax | Permalink | Comments (0)

Lederman: Does Enforcement Reduce Voluntary Tax Compliance?

Leandra Lederman (Indiana), Does Enforcement Reduce Voluntary Tax Compliance?, 2018 BYU L. Rev. 623 (reviewed by Orly Mazur (SMU) here):

Governments generally use enforcement methods, such as audits and the imposition of penalties, to deter noncompliance with tax laws. Although this approach is consistent with most economic modeling of tax compliance, some scholars caution that enforcement may backfire, “crowding out” taxpayers’ intrinsic motivations to pay taxes to such an extent that they reduce their tax payments. This article analyzes the existing evidence to determine if and when this occurs.

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May 15, 2019 in Scholarship, Tax | Permalink | Comments (0)

A New Growth Vision For Legal Education, Part I: Sustainable Growth Or Dead Cat Bounce?

Hilary G. Escajeda (Denver), Legal Education: A New Growth Vision Part I – The Issue: Sustainable Growth or Dead Cat Bounce? A Strategic Inflection Point Analysis, 97 Neb. L. Rev. 628 (2019):

Legal education programs now face strategic inflection points. To survive and thrive long-term, education programs must embrace entrepreneurship, technology, innovation, platforms, and customer service as the means by which to navigate through strategic inflection points. Imagination, adaptability, agility, determination, and speed will separate market leaders from laggards. Scrappy, entrepreneurial, and action-oriented programs that deliver omni-channel, lifelong knowledge and skills development solutions are the movers that will radically redefine and likely dominate the legal education industry. Slow, tradition-bound programs resistant to change are non-movers that face extinction.

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May 15, 2019 in Legal Education, Scholarship | Permalink | Comments (3)

Elizabeth Warren’s Wealth Tax Will Aggravate Global Inequality

Monica Victor (S.J.D. 2019, Florida), U.S. Sen. Warren’s Wealth Tax Proposal: Will Fighting U.S. Inequality Aggravate Global Inequality?:

Recently, the U.S. Senator Elizabeth Warren proposed a Wealth Tax on “Americans Super Millionaires” which was announced as a measure to reduce U.S. inequality, to rebuild the American middle class and to promote tax justice. Wealth inequality is a global issue, the imposition of a domestic Wealth Tax without international coordination and agreed international rules about the allocation of taxing rights and wealth among countries will aggravate global inequality and concentrate public revenue in jurisdictions with better enforcement capabilities.

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May 15, 2019 in Scholarship, Tax | Permalink | Comments (1)

The Best LL.M. Programs

International JuristThe Best LL.M. Programs, The International Jurist (2019):

To identify the best LL.M. programs, we looked to see which schools place a premium on four key areas: the law school experience; career assistance; value; and academics. We asked the more than 150 schools with LL.M. programs for foreign attorneys to respond to a survey to offer insight into their offerings. ...

The Law School Experience.  This category looks at several factors, including whether students can work on law journals and participate in clinics, whether the school provides mentors, the number of extracurricular offerings, the level of involvement with U.S. students, networking opportunities, organized excursions and what the law school does to help LL.M. students adjust to the U.S. and the school. ...

IJ1

Value. We assessed net cost, which is tuition and housing minus scholarships, and weighed that against the school’s performance in the Law School Experience category.

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May 15, 2019 in Law School Rankings, Legal Education | Permalink | Comments (0)

Tuesday, May 14, 2019

Polsky: Explaining Choice-Of-Entity Decisions By Silicon Valley Start-Ups

Gregg D. Polsky (Georgia),  Explaining Choice-of-Entity Decisions by Silicon Valley Start-Ups, 70 Hastings L.J. 409 (2019):

Perhaps the most fundamental role of a business tax advisor is to recommend the optimal entity choice for nascent business enterprises. Nevertheless, even in 2018, the choice-of-entity analysis remains highly muddled. Most tax practitioners across the United States consistently recommend flow-through entities, such as LLCs and S corporations, to their clients. In contrast, a discrete group of highly sophisticated tax professionals, those who advise start-ups in Silicon Valley and other hotbeds of start-up activity, prefer C corporations.

Prior commentary has described and tried to explain this paradox without finding an adequate explanation. These commentators have noted a host of superficially plausible explanations, all of which they ultimately conclude are not wholly persuasive. The puzzle therefore remains.

This article attempts to finally solve the puzzle by examining two factors that have been either vastly underappreciated or completely ignored in the existing literature.

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May 14, 2019 in Scholarship, Tax | Permalink | Comments (1)

Mazur: Taxing The Robots

Orly Mazur (SMU), Taxing the Robots, 46 Pepp. L. Rev. 277 (2019):

Robots and other artificial intelligence-based technologies are increasingly outperforming humans in jobs previously thought safe from automation. This has led to growing concerns about the future of jobs, wages, economic equality and government revenues. To address these issues, there have been multiple calls around the world to tax the robots. Although the concerns that have led to the recent robot tax proposals may be valid, this Article cautions against the use of a robot tax. It argues that a tax that singles out robots is the wrong tool to address these critical issues and warns of the unintended consequences of such a tax, including limiting innovation. Rather, advances in robotics and other forms of artificial intelligence merely exacerbate the issues already caused by a tax system that under-taxes capital income and over-taxes labor income.

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May 14, 2019 in Scholarship, Tax | Permalink | Comments (2)

The Path To Big Law Equity Partnership Is Narrowing

American Lawyer, The Path to Big Law Equity Partnership Is Narrowing:

Twenty years ago, holding the partner title at an Am Law 100 firm usually meant sharing in the firm’s profits. That’s not the case any more. A new analysis of partner numbers by ALM Intelligence shows that among the Am Law 100, the percentage of equity partners has been steadily declining since 2000. That comes even as the nation’s top-grossing firms have been seeing steady growth since the Great Recession.

American Lawyer

 

May 14, 2019 in Legal Education | Permalink | Comments (1)

Walker: The Practice And Tax Consequences Of Nonqualified Deferred Compensation

David I. Walker (Boston University), The Practice and Tax Consequences of Nonqualified Deferred Compensation, 75 Wash. & Lee L. Rev. 2065 (2018):

Although nonqualified deferred compensation plans lack explicit tax preferences afforded qualified plans, it is well understood that nonqualified deferred compensation results in a joint tax advantage when employers earn a higher after‐tax return on deferred sums than employees could do on their own. Several commentators have proposed tax reform aimed at leveling the playing field between cash and nonqualified deferred compensation, but reform would not be easy or straightforward. This Article investigates nonqualified deferred compensation practices and shows that joint tax minimization often takes a backseat to accounting priorities and participant diversification concerns.

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May 14, 2019 in Scholarship, Tax | Permalink | Comments (0)

Tax Games, Roadblocks, And Glitches Under The 2017 Tax Legislation

Reuven Avi-Yonah (Michigan), Lily Batchelder (NYU), Cliff Fleming (BYU), David Gamage (Indiana), Ari Glogower (Ohio State), Daniel Hemel (Chicago), David Kamin (NYU), Mitchell Kane (NYU), Rebecca Kysar (Fordham), David Miller (Proskauer, New York), Darien Shanske (UC-Davis), Dan Shaviro (NYU) & Manoj Viswanathan (UC-Hastings), The Games They Will Play: Tax Games, Roadblocks, and Glitches Under the 2017 Tax Legislation, 103 Minn. L. Rev. 1439 (2019) (reviewed by David Gamage (Indiana) here):

This report describes various tax games, roadblocks, and glitches in the tax legislation currently before Congress, titled the Tax Cuts and Jobs Act (TCJA). The complex rules proposed in the House and Senate bills will allow new tax games and planning opportunities for well-advised taxpayers, which will result in unanticipated consequences and costs. These costs may not currently be fully reflected in official estimates already showing the bills adding over $1 trillion to the deficit in the coming decade. Other proposed changes will encounter legal roadblocks that will jeopardize critical elements of the legislation. Finally, in other cases, technical glitches in the legislation may improperly and haphazardly penalize or benefit individual and corporate taxpayers.

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May 14, 2019 in Scholarship, Tax | Permalink | Comments (0)

39 Law Schools Now Accept The GRE For Admissions (The Latest Are Florida International, New Hampshire, UC-Irvine)

GREFlorida International, New Hampshire, and UC-Irvine are the latest law schools to accept the GRE (joining American, Arizona, Boston University, Brooklyn, Buffalo, BYU, Cardozo, Chicago, Chicago-Kent, Columbia, Cornell, Dayton, Florida State, George Mason, Georgetown, Harvard, Hawaii, John Marshall (Chicago), MassachusettsNorthwestern, Notre Dame, NYU, Pace, Pennsylvania, Pepperdine, South Carolina, St. John's, Suffolk, Texas, Texas A&M, UC-Davis, UCLA, USC, Virginia, Wake Forest, and Washington University).

Georgia and Penn State (University Park) allow students enrolled in a dual degree program at the university to submit the GRE. (George Washington has rescinded its use of the GRE because it has not done a school-specific validation study.)  A non-U.S. law school — Hamd Bin Khalifa University Law School (Qatar), in partnership with Northwestern — also accepts the GRE.

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May 14, 2019 in Legal Education | Permalink | Comments (0)

Kahn: Suspension Of Miscellaneous Itemized Deductions Conflicts With Sound Tax Policy

Douglas A. Kahn (Michigan), Suspension of Miscellaneous Itemized Deductions is Ill-Advised, 102 Tax Notes 777 (Feb. 18, 2019):

Section 67(g), added to the code by the Tax Cuts and Jobs Act, suspends any miscellaneous itemized deductions from 2018 to 2025. A miscellaneous itemized deduction is any itemized deduction that is not listed in section 67(b). This article explains that the suspension of some of the miscellaneous itemized deductions is unjustified and conflicts with fundamental tax policy.

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May 14, 2019 in Scholarship, Tax | Permalink | Comments (2)

Legal Education Quote Of The Day

Law.com, Morning Minute:

I am one of many people who went to law school because I was told there would be no math.

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May 14, 2019 | Permalink | Comments (0)

Monday, May 13, 2019

An Old Tax Dodge For The Wealthy Is Making A Comeback: 'Upstream Planning'

Barron'sBarron's, An Old Tax Dodge for the Wealthy Is Making a Comeback:

Advisors are dusting off an old tax-savings strategy after it got an enormous boost under the new tax law, enabling taxpayers to wipe out massive potential tax obligations on appreciated assets.

The maneuver is simple: You give a highly appreciated asset—such as stocks that have gone up in value—to a parent or trusted elder, with the understanding that it will be bequeathed back to you. At that point, it gets a step-up in cost basis—which means you can sell the shares immediately without owing any tax on the gains it accumulated since you initially bought the stock.

The key to the renewed interest in this strategy—called “upstream planning” because the assets initially flow from the younger generation to the older—is the new tax law, which doubled the amount anyone can give away in assets, while alive or after death, to $11.4 million. The exemption can be used to shield your estate from taxes upon death or during your lifetime to make tax-free gifts—such as appreciated assets using upstream planning. ...

“People [previously] didn’t want to use up their estate tax exemption, but the whole paradigm has shifted because of this new high exemption amount,” says Jere Doyle, an estate planning strategist at BNY Mellon Wealth Management. “When they doubled the exemption, everyone thought they’d do away with the step-up in basis at death, but that didn’t happen. So this creates a huge opportunity for taxpayers.”

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May 13, 2019 in Tax | Permalink | Comments (0)

Inside Harvard Law School's Zero-L Program

Law.com, Inside Harvard Law School's Zero-L Program:

Harvard Law School’s incoming class of students will get a head start on their legal studies this summer. The school will soon launch the second iteration of its Zero-L program—a first-of-its kind curriculum of online courses designed to give new students some legal basics and a roadmap of what to expect once they arrive on campus.

I caught up with professor Glenn Cohen, who developed Zero-L with associate dean for strategic initiatives Jessica Soban at the direction of dean John Manning, to talk about the program and how it’s evolving after the pilot last summer. What initially struck me was that Zero-L has a very different focus than the existing pre-1L programs that I’m familiar with. Those tend to target admitted students with relatively low LSAT scores who may benefit from a legal foundation before they begin. Cohen confirmed my hunch that Zero-L didn’t come about because Harvard was worried that its new 1Ls wouldn’t be able to keep up. (Its median LSAT this year was 173. They’ll be fine.) Rather, the school hopes that the program will give new students a smoother transition into law school life. 

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May 13, 2019 in Legal Education | Permalink | Comments (1)

Kristin Hickman Completes One-Year Stint In The White House As Special Adviser To OMB

Hickman (2017)Bloomberg Law, Tax Scholar Leaves White House Regulatory Review Office:

Kristin Hickman is no longer working with the White House’s Office of Management and Budget after being hired last year to strengthen its tax expertise.

Hickman, a law professor at the University of Minnesota who specializes in tax administration and administrative law, confirmed in an email to Bloomberg Tax that she wrapped up her time at OMB’s Office of Information and Regulatory Affairs in April. OIRA announced around the same time last year that it had selected Hickman to serve as a special adviser.

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May 13, 2019 in Tax, Tax Prof Moves | Permalink | Comments (0)

Illinois Econ Professor Resigns After He Admits Sharing Photos With Student But Denies Sex-For-Grade Allegation; Accuser Is Arrested On Related Charge

Illinois 2Chronicle of Higher Education, Student Who Accused Professor of Sex-for-Grades Harassment Is Arrested on Related Charge:

A clinical professor of economics at the University of Illinois at Urbana-Champaign says the sexual-harassment investigation against him was supposed to end when he agreed to retire. The university contends the inquiry involving Joseph A. Petry remains open.

But the dispute over his employment isn’t the only puzzling development in the drama that has enveloped Petry.

This week the woman who had accused him of asking her for sex in exchange for raising her grade was criminally charged, along with another student, in a bizarre incident that involved holding another student at knifepoint. The police said Petry’s accuser, Summer S. Naqvi, deleted information from her former boyfriend’s computer and phone while her friend allegedly held a knife to the ex-boyfriend’s throat. The ex-boyfriend wasn’t physically hurt, and he told the police he believed the information Naqvi was after related to her harassment complaint against Petry. ...

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May 13, 2019 in Legal Education | Permalink | Comments (0)

The 50 Most-Cited Tax Articles of All Time

Jonathan H. Choi (NYU), The Most-Cited Tax Articles of All Time, 36 Yale J. on Reg.: Notice & Comment (May 11, 2019):

Summer is nearly here, and for fellow tax nerds in need of beach reads, I’ve assembled a list of the 50 most widely cited tax law journal articles. The list is inspired by (and uses the same methodology as) Fred Shapiro and Michelle Pearse’s essay, The Most-Cited Law Review Articles of All Time [110 Mich. L. Rev. 1483 (2012)]

The list below is ordered by number of citations in other law review articles, according to HeinOnline. For comparison, I also list Google Scholar citation counts, which include cites by certain non-law journals, practice publications, books, and courts. 

Most-cited tax articles of all time

  Article HeinOnline Article Cites Google Scholar Cites
1. William D. Andrews (Harvard), A Consumption-Type or Cash Flow Personal Income Tax, 87 Harv. L. Rev. 1113 (1974) 437 783
2. Louis Kaplow (Harvard) & Steven Shavell (Harvard), Why the Legal System Is Less Efficient than the Income Tax in Redistributing Income, 23 J. Legal Stud. 667 (1994) 305 687
3. Boris I. Bittker (Yale), A Comprehensive Tax Base as a Goal of Income Tax Reform, 80 Harv. L. Rev. 925 (1967) 298 464
4. Boris I. Bittker (Yale), Federal Income Taxation and the Family, 27 Stan. L. Rev. 1389 (1975) 284 438
5. Joseph Bankman (Stanford) & Thomas Griffith (USC), Social Welfare and the Rate Structure: A New Look at Progressive Taxation, 75 Cal. L. Rev. 1905 (1987) 227 352
6. Reuven S. Avi-Yonah (Michigan), Globalization, Tax Competition, and the Fiscal Crisis of the Welfare State, 113 Harv. L. Rev. 1573 (2000) 226 748
7. William T. Plumb, Jr. (Hogan & Hartson, Washington, D.C.), The Federal Income Tax Significance of Corporate Debt: A Critical Analysis and a Proposal, 26 Tax L. Rev. 369 (1971) 208 355
8. Walter J. Blum (Chicago) & Harry Kalven, Jr. (Chicago), The Uneasy Case for Progressive Taxation, 19 U. Chi. L. Rev. 417 (1952) 200 418
9. Peter D. Enrich (Northeastern), Saving the States from Themselves: Commerce Clause Constraints on State Tax Incentives for Business, 110 Harv. L. Rev. 377 (1996) 193 371
10. Michael J. Graetz (Columbia), To Praise the Estate Tax, Not to Bury It, 93 Yale L.J. 259 (1983) 185 264
11. Erwin N. Griswold (Harvard), The Need for a Court of Tax Appeals, 57 Harv. L. Rev. 1153 (1944) 185 240
12. Mark G. Kelman (Stanford), Personal Deductions Revisited: Why They Fit Poorly in an Ideal Income Tax and Why They Fit Worse in a Far from Ideal World, 31 Stan. L. Rev. 831 (1979) 177 248
13. Daniel I. Halperin (Harvard), Interest in Disguise: Taxing the Time Value of Money, 95 Yale L.J. 506 (1986) 168 259
14. Joseph T. Sneed (Stanford), The Criteria of Federal Income Tax Policy, 17 Stan. L. Rev. 567 (1965) 164 211
15. Michael J. Graetz (Columbia) & Michael M. O’Hear (Marquette), The “Original Intent” of U.S. International Taxation, 46 Duke L.J. 1021 (1997) 162 345
16. Eric A. Posner (Chicago), Law and Social Norms: The Case of Tax Compliance, 86 Va. L. Rev. 1781 (2000) 155 403
17. David A. Weisbach (Chicago) & Jacob Nussim (Bar-Ilan), The Integration of Tax and Spending Programs, 113 Yale L.J. 955 (2004) 150 245
18. Marjorie E. Kornhauser (Tulane), The Rhetoric of the Anti-Progressive Income Tax Movement: A Typical Male Reaction, 86 Mich. L. Rev. 465 (1987) 146 214
19. R.A. Musgrave (Harvard), In Defense of an Income Concept, 81 Harv. L. Rev. 44 (1967) 140 228
20. Marjorie E. Kornhauser (Tulane), Love, Money, and the IRS: Family, Income-Sharing, and the Joint Income Tax Return, 45 Hastings L.J. 63 (1993) 139 216
21. Paul L. Caron (Pepperdine), Tax Myopia, or Mamas Don’t Let Your Babies Grow up to Be Tax Lawyers, 13 Va. Tax Rev. 517 (1994) 137 155
22. Richard L. Doernberg (Emory) & Fred S. McChesney (Emory), On the Accelerating Rate and Decreasing Durability of Tax Reform, 71 Minn. L. Rev. 913 (1987) 136 183
23. Reuven S. Avi-Yonah (Michigan), The Structure of International Taxation: A Proposal for Simplification, 74 Tex. L. Rev. 1301 (1996) 129 285
24. Anne L. Alstott (Yale), Tax Policy and Feminism: Competing Goals and Institutional Choices, 96 Colum. L. Rev. 2001 (1996) 129 192
25. Stanley S. Surrey (Harvard), Federal Taxation of the Family—The Revenue Act of 1948, 61 Harv. L. Rev. 1097 (1948) 127 218

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May 13, 2019 in Legal Education, Scholarship, Tax, Tax Prof Rankings | Permalink | Comments (5)

Lesson From The Tax Court: Get It In Writing!

Tax Court (2017)Last week’s case of Jason Aaron Cook v. Commissioner, T.C. Memo. 2019-48 (May 7, 2019) (Judge Colvin), teaches a straightforward lesson: if you are not the custodial parent of a child and want to claim the child as your “dependent” within the meaning of §152, you need to obtain a Form 8332, or an equivalent document, from the custodial parent.  You need to get it in writing.

The case also teaches a more fundamental lesson in some of the complexities of family taxation.  The lesson here shows how the tax law indirectly defines families through the concept of dependents.  When a taxpayer can claim someone as a dependent, that triggers a host of different tax rules for that taxpayer---mostly good.  The cumulative effect creates the rules of family taxation. 

The biggest group of dependents are children, at least until more Boomers hit their dotage.  When spouses stay together the idea of defining families through the concept of dependents works pretty well.  When spouses split up, however, it becomes much harder figuring out the appropriate family unit to tax.  Section 152(e) uses a concept of "custodial parent."  Last week’s case is a good illustration of the Tax Code’s basic approach, and its limitations.

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May 13, 2019 in Bryan Camp, New Cases, Scholarship, Tax, Tax Practice And Procedure | Permalink | Comments (2)

Private College Tuition Discount Rate Hits All-Time High Of 52%

2018 NACUBO Tuition Discounting Study:

In the 2018 NACUBO Tuition Discounting Study, 405 private, nonprofit colleges and universities reported an estimated 52.2 percent institutional tuition discount rate for first-time, full-time students in 2018-19 and 46.3 percent for all undergraduates – both record highs. This means that for every dollar in gross tuition and fee revenue collected from all students, institutions used nearly half for financial aid, including grants, scholarships, and fellowships.

NACUBO

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May 13, 2019 in Legal Education | Permalink | Comments (0)

TaxProf Blog Weekend Roundup

Sunday, May 12, 2019

More On The ABA Law School Employment Data

Following up on my previous posts on the new ABA law school employment data (links below):

Robert Anderson (Pepperdine), Ranking Law School Employment Outcomes by Term and Type:

In this installment, I look at the quality of employment "terms" and "types" as the ABA categorizes them. Employment "terms" are part-time versus full-time and long-term versus short-term. Employment "types" are the various types of employers, such as law firms with 501+ lawyers, solo practice, federal judicial clerkships, etc. This allows a comparison of the quality of the various categories of employment as they are reported to the ABA.

The table below shows the ranking from best outcomes to worst outcomes for the most common types and terms ...

Here are the five best outcomes under Rob's methodology:

Anderson

Robert Anderson (Pepperdine), Ranking Law Schools by "JD Advantage" Jobs:

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May 12, 2019 in Legal Education | Permalink | Comments (1)

Zakat: Islam’s Missed Opportunity To Limit Predatory Taxation

Timur Kuran (Duke), Zakat: Islam’s Missed Opportunity To Limit Predatory Taxation:

One of Islam’s five canonical pillars is a predictable, fixed, and mildly progressive tax system called zakat. It was meant to finance various causes typical of a pre-modern government. Implicit in the entire transfer system was personal property rights as well as constraints on government—two key elements of a liberal order. Those features could have provided the starting point for broadening political liberties under a state with explicitly restricted functions. Instead, just a few decades after the rise of Islam, zakat opened the door to arbitrary political rule and material insecurity.

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May 12, 2019 in Scholarship, Tax | Permalink | Comments (0)

Snow-mencement At The University Of Colorado

The Top Five New Tax Papers

SSRN Logo (2018)There is quite a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new #1 paper and a new paper debuting on the list at #5:

  1. [372 Downloads]  Taxing the Digital Economy Post BEPS ... Seriously, by Andrés Báez (Universidad Carlos III de Madrid) & Yariv Brauner (Florida)
  2. [371 Downloads]  Residual Profit Allocation by Income, by Michael Devereux (Oxford), Alan Auerbach (UC-Berkeley), Michael Keen (IMF), Paul Oosterhuis (Skadden), Wolfgang Schön (Max Planck) & John Vella (Oxford) (reviewed by Christine Kim (Utah) here)
  3. [169 Downloads]  The Architecture of a Basic Income, by Miranda Perry Fleischer (San Diego) & Daniel Jacob Hemel (Chicago)
  4. [166 Downloads]  Fixing Philanthropy: A Vision for Charitable Giving and Reform, by Roger Colinvaux (Catholic)
  5. [160 Downloads]  Critical Tax Thinking, by Edward Kleinbard (USC)

May 12, 2019 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, May 11, 2019

This Week's Ten Most Popular TaxProf Blog Posts

Ian Samuel Resigns From Indiana Law Faculty Following Title IX Investigation

SamuelIan Samuel, Associate Professor Of Law at Indiana University Maurer School of Law, resigned yesterday and posted this letter on his Twitter account:

Dear Provost Robel,

Last fall, the university opened a Title IX investigation in which I was the responding party.

Since then, I’ve kept quiet in public, and I’ve done everything I can to cooperate with the university’s process. But the investigation is done now, and for the reasons I’ll explain in this letter, I hereby resign my appointment as an associate professor, effective at the close of business today. I’m choosing to forgo procedural rights that might (though I doubt it) preserve my job if I fought to the Pyrrhic end, because the academic year is over and it’s time for this process to be over, too.

Why? Well, I don’t think I’m breaching any confidences by saying that the allegations in this case describe me drinking to excess in a public place I shouldn’t have been, in company I shouldn’t have kept, and treating the people present in ways they didn’t deserve. Those behaviors are totally inconsistent with what any university expects of its faculty, of course, but it’s more than that. When the investigation began, a few people I trust suggested that maybe it was time to take a hard look at my life. They were right. Once I was ready to be honest with myself, I had to admit that the night in question was the clearest sign yet of a problem that had been growing for some time, and which was going to keep growing as long as I kept ignoring it. Although that admission didn’t solve any- thing by itself, it did beat denial.

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May 11, 2019 in Legal Education | Permalink | Comments (4)

Batchelder: Trump Is A Bad Businessman. Is He A Tax Cheat, Too?

New York Times op-ed:  Trump Is a Bad Businessman. Is He a Tax Cheat, Too?, by Lily Batchelder (NYU):

The latest bombshell Times story on the president’s tax history confirms what we already suspected: Donald Trump is a terrible businessman. Despite inheriting more than $400 million and being bailed out by his father at critical junctures, he managed to lose (or at least claim tax losses) of more than $1 billion over a decade.

The latest story also shows how we do a terrible job of adequately taxing the wealthy. The 400 richest Americans often pay tax at lower rates than the middle class because so much income from wealth is taxed at low or zero rates.

But perhaps most important, the story reinforces the need for a congressional investigation of the president’s tax returns.

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May 11, 2019 in Tax | Permalink | Comments (7)

ABA Tax Section May Meeting

ABA 3The highlight of the ABA Tax Section May Meeting (program) in Washington, D.C. for Tax Profs is the Teaching Taxation Program:

Higher Education and Taxation: Are We Getting Tax Policy Right for the Mission of Education? The country is in a battle over the role, place, and funding of higher education. Who is it for? How should it be financed? What should it provide? The tax law impacts higher education in significant ways. This panel will examine those impacts and consider whether we get that policy right, and whether any changes are needed. The 2017 Tax Act imposed new taxes on colleges and universities with large endowments and big salaries. What will be the impact of these changes? Should public universities be able to elect in and out of section 501(c)(3) status? If so, should they be subject to a special set of rules? For-profit higher education providers are increasingly converting to nonprofit status in order to take advantages of benefits provided to tax exempt entities. Should there be rules limiting the entry of for-profit organizations? Tax law also impacts student borrowing. Do we get the incentives right or could we do better in structuring those incentives to benefit those in need?

  • Ellen Aprill (Loyola-L.A.)
  • Brian Galle (Georgetown)
  • Philip Hackney (Pittsburgh) (moderator)
  • Benjamin Leff (American)
  • Alexandra Mitchell (RSM US LLP, Washington, D.C.)
  • Kerry Ryan (Saint Louis) (chair)

Other Tax Prof speakers at the May Meeting:

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May 11, 2019 in ABA Tax Section, Conferences, Tax | Permalink | Comments (0)

Friday, May 10, 2019

Weekly SSRN Tax Article Review And Roundup: Kleiman Reviews Soled & Schmalbeck's Determining An Asset's Tax Basis Absent A Meaningful Transfer Tax Regime

This week, Ariel Jurow Kleiman (San Diego) reviews Determining an Asset's Tax Basis in the Absence of A Meaningful Transfer Tax Regime, a new work by Jay A. Soled (Rutgers) and Richard L. Schmalbeck (Duke), recently published in the Columbia Journal of Tax Law.

StevensonIronically, although death and taxes are the only two certainties in life, the “death tax” is largely voluntary. (Forgive the controversial term—its purpose is rhetorical, not ideological.)  With the estate and gift tax exemption up to $11.18 million per person, the tax’s voluntary nature is truer now than ever before.  In their recent article, Jay Soled and Richard Schmalbeck argue that the transfer tax’s diminution will not only reduce estate and gift tax revenue, but will enable taxpayers to game the income tax as well.

The crux of the authors' argument rests on IRC § 1014(f), which requires that the stepped-up basis of property acquired from a decedent not exceed the property’s value that is reported for estate tax purposes.  This rule creates two counterbalancing incentives for taxpayers appraising an estate’s assets.  First, taxpayers will want to undervalue property to reduce estate tax burdens.  Second, taxpayers will want to overvalue property to obtain a higher basis under § 1014.  When weighing both, the estate tax’s pressures have typically dominated, largely because the tax cannot be deferred until later.  Thus, a robust estate tax mitigates incentives for taxpayers to abuse the already generous § 1014 step-up in basis. 

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May 10, 2019 in Ariel Stevenson, Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Legal Education Roundup

Tax Policy In The Trump Administration

More Commentary On Trump's Taxes And Tax Returns

NYU Symposium: Social Welfare Organizations — Better Alternatives To Charities?

NYU Law (2016)Symposium, Social Welfare Organizations: Better Alternatives to Charities?, 21 N.Y.U. J. Legis. & Pub. Pol'y 337-634 (2018):

Introduction:

Articles:

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May 10, 2019 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Judge Rules Wendi Adelson Need Not Give Defense Deposition, Denies Continuance In Dan Markel Murder Trial

Adelson (2019)Tallahassee Democrat, Judge: Wendi Adelson Doesn't Have to Give Defense Deposition:

A Leon Circuit judge upheld a protective order asking that Wendi Adelson not be required to give a deposition by the defense team of a suspect in the murder of her ex-husband Dan Markel.

The attorneys for Katherine Magbanua asked that they be allowed to question Adelson prior to the June trial or that that her testimony be excluded in full at trial. Magbanua’s attorneys contended Adelson cannot flatly invoke her Fifth Amendment right against self-incrimination but could choose to on a question-by-question basis.

But Judge James C. Hankinson disagreed, granting Adelson the right to defer the defense subpoena.

Adelson, through her attorney John Lauro, asserted her right after being subpoenaed April 19 for a deposition by the defense team of Magbanua, who is accused of being the go-between Adelson's family and a pair of hit men.

Lauro last week filed the motion saying Adelson intends to testify only at trial, where a government subpoena would offer her immunity. ...

Hankinson also denied a motion filed earlier this week by Magbanua's team asking for a continuance.

Tallahassee Democrat, One Continuance in Dan Markel Trial Denied, Another Still in Limbo

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May 10, 2019 in Legal Education | Permalink | Comments (2)

Loyola-L.A. Launches Online Tax Program

Loyola-L.A. Logo (2013)Loyola Law School’s New Online Tax Program to Provide Nationwide Access to its Rigorous Tax Law Training:

LMU's Loyola Law School is launching an online version of its highly ranked Graduate Tax curriculum. The new custom-built online courses will make Loyola’s distinctive approach to rigorous tax law training available to Tax LLM, Master of Tax Law and JD students nationwide beginning in August 2019.

Based on U.S. News survey data and TaxProf Blog’s ranking methodology, Loyola will immediately become the third-ranked online tax law provider in the United States.

Unlike other similarly ranked programs, which generally offer only recorded versions of live classes, Loyola’s courses will be designed specifically for online students, deploying cutting-edge technology to be as interactive, engaging and educationally effective as possible.

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May 10, 2019 in Legal Education, Tax | Permalink | Comments (0)

Pepperdine Hosts International Conference For Dispute Resolution Teachers, Scholars, And Leaders

Straus

The Straus Institute for Dispute Resolution at Pepperdine Law School, ranked #1 by U.S. News & World Report for 13 of the past 15th years, will host a landmark conference on June 18-19, 2019: Appreciating Our Legacy and Engaging the Future: An International Conference for Dispute Resolution Teachers, Scholars, and Leaders. Participants will compare perspectives on four decades of change in managing and resolving conflict.

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May 10, 2019 in Legal Education | Permalink | Comments (0)