Paul L. Caron

Friday, December 18, 2020

Lipman: What National Taxpayer Advocate Nina Olson Did For America's Kids And Their Families

Francine J. Lipman (UNLV), Humanizing the Tax System: What National Taxpayer Advocate Nina E. Olson Did For America's Kids and their Families, 18 Pitt. Tax Rev. ___ (2020):

Pitt Tax Review (2020)At their core, taxpayer rights are human rights. They are about our inherent humanity. — Nina E. Olson

The federal income tax system does not exist for statutes, regulations, codes, enforcement, assessments, collection, redistribution, procedures, publications, liens, levies, refunds, liabilities, litigation, compliance, or even revenue. At its core, the federal income tax system exists for people. People like you, me, and all our loved ones including spouses, partners, parents, kids, brothers, sisters, nieces, nephews, grandparents, grandkids, friends, and neighbors. The people who eat at our tables and sleep under our roofs. The tax system is about current and future generations who live and work in America, and even those who don’t but have the coveted prize of U.S. citizenship. It is about our shared vision of ensuring the well-being of all people, young, old, Black, Brown, White, Asian, Native, multiracial, religious, atheist, agnostic, male, female, transgender, straight, queer, or nonconforming. It is about ensuring that the people of and in America have what they need to survive and thrive, especially those who are vulnerable for any reason or no reason at all. Tax systems, like other government institutions, should be designed and administered to make life better for everyone. Because “we the people” are America, the beautiful, the federal tax system serves us. This is the truth that Nina E. Olson laid bare during her eighteen years of service as the longest-serving National Taxpayer Advocate (NTA).

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December 18, 2020 in IRS News, Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Thursday, December 17, 2020

The Law Of High-Wealth Exceptionalism

Allison Anna Tait (Richmond), The Law of High-Wealth Exceptionalism, 71 Ala. L. Rev. 981 (2020):

No family is an island. But some families would like to be – at least when it comes to wealth preservation – and they depend on what this Article calls the law of high-wealth exceptionalism to facilitate their success. The law of high-wealth exceptionalism has been forged, over the years, from the twinned scripts of wealth management and family wealth law, both of which constitute high-wealth families as sovereign entities capable of self-regulation and deserving of exemption from the rules that govern ordinary-wealth families. Consequently, high-wealth families take advantage of complicated estate planning techniques and highly favorable wealth rules in order build walls around their family fortunes and construct bespoke governance systems. Hiding in plain sight, the law of high-wealth exceptionalism protects, privileges, and enables high-wealth families in their own particular form of organizational sovereignty.

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December 17, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (1)

Property Tax Foreclosure And Predatory Cities

Bernadette Atuahene (Chicago-Kent), Predatory Cities, 108 Cal. L. Rev. 107 (2020):

Between 2011 and 2015, the Wayne County Treasurer completed the property tax foreclosure process for one in four properties in Detroit, Michigan. No other American city has experienced this elevated rate of property tax foreclosures since the Great Depression. Studies reveal that the City of Detroit systematically and illegally inflated the assessed value of most of its residential properties, which led to inflated property tax bills unaffordable to many homeowners. Extraordinary tax foreclosure rates and extensive dispossession resulted. Consequently, Detroit has become a “predatory city”—a new and important sociolegal concept that this Article develops.

This Article is the first attempt to understand the intersecting economic, social, and political factors that have caused these struggling cities to become predatory.

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December 17, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Johnson & Johnson Debate Gitlitz

Point: Calvin H. Johnson (Texas), The Supreme Court’s Statutory Interpretation in Gitlitz: A Failed Approach to Interpretation and a Bad Decision, 40 ABA Tax Times (Fall 2020):

ABA Tax TimesThe Supreme Court’s decision in Gitlitz v. Commissioner is an irresponsible decision disrupting the logic of tax for the benefit only of abuse. In Gitlitz the Supreme Court gave the equivalent of a double deduction, both an appropriate exclusion of cancellation of indebtedness income for an insolvent Subchapter S corporation and also an inappropriate increase in shareholder basis. The combination of the exclusion and shareholder basis generated a tax loss that had no economic substance, a loss that in Judge Posner’s wonderful phrase “did not impinge on the world.” ...

The approach in Gitlitz allowing an absurd tax deduction shows a hostility to the tax system that is inappropriate for a court in its role as a faithful servant. There are fundamental principles underlying the tax law, including antagonism to double deductions and deduction of phantom losses. The Supreme Court has a duty to interpret tax law in favor of coherent principle, and Gitlitz violates fundamental principle.

Counterpoint: Steve Johnson (Florida State), The Constitution Is More Important than a Few Tax Dollars Squandered by Congress: Gitlitz Was Correctly Decided, 40 ABA Tax Times (Fall 2020):

Gitlitz was decided two decades ago, and its practical import was rapidly nullified when Congress amended the statute to remove the glitch in the statute Congress originally enacted. That being so, is Gitlitz worth our time and thought today? Yes, it is. In Gitlitz, the Supreme Court reminded us that the constitutional separation of powers principle is for the long term and should not be eroded by yielding to temptations of the moment.

My respect for Professor Calvin Johnson is great, but so is my conviction that, in this instance, his view is unwise.

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December 17, 2020 in ABA Tax Section, Scholarship, Tax, Tax Scholarship | Permalink | Comments (1)

Cantley: Captive Insurance Companies

Beckett G. Cantley (Northeastern), FAQ: Anti-Avoidance Law & Estate Planning with Captives:

This article seeks to address how general judicial anti-avoidance law may be applied to estate planning with IRC 831(b) captive insurance companies.

Beckett G. Cantley (Northeastern), Calculating Captive Insurance Settlement Initiative Benefits:

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December 17, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Wednesday, December 16, 2020

Fifty Years Of Tax Cuts For The Rich Didn’t Trickle Down, Study Says

David Hope & Julian Limberg (London School of Economics & Political Science), The Economic Consequences of Major Tax Cuts for the Rich:

This paper uses data from 18 OECD countries over the last five decades to estimate the causal effect of major tax cuts for the rich on income inequality, economic growth, and unemployment. First, we use a new encompassing measure of taxes on the rich to identify instances of major reductions in tax progressivity. Then, we look at the causal effect of these episodes on economic outcomes by applying a nonparametric generalization of the difference-in-differences indicator that implements Mahalanobis matching in panel data analysis. We find that major reforms reducing taxes on the rich lead to higher income inequality as measured by the top 1% share of pre-tax national income. The effect remains stable in the medium term. In contrast, such reforms do not have any significant effect on economic growth and unemployment.


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December 16, 2020 in Scholarship, Tax, Tax News, Tax Scholarship | Permalink | Comments (1)

Yin: Repairing The Tax Privacy Rules

George K. Yin (Virginia), Repairing the Tax Privacy Rules, 169 Tax Notes Fed. 1485 (Nov. 30, 2020):

Tax Notes Federal (2020)For almost four years, the nation has experienced numerous governmental deviations from rules and norms that have exposed gaps or weaknesses in many areas of law. This article describes needed changes in three tax privacy areas: access and disclosure of presidential tax information; civil enforcement of congressional subpoenas; and confidentiality protections for tax return information obtained by subpoena.

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December 16, 2020 in Scholarship, Tax, Tax Analysts, Tax Scholarship | Permalink | Comments (0)

SSRN Tax Professor Rankings

SSRN Logo (2018)SSRN has updated its monthly ranking of 750 American and international law school faculties and 3,000 law professors by (among other things) the number of paper downloads from the SSRN database.  Here is the new list (through December 1, 2020) of the Top 25 U.S. Tax Professors in two of the SSRN categories: all-time downloads and recent downloads (within the past 12 months):

    All-Time   Recent
1 Reuven Avi-Yonah (Michigan)  194,887 Reuven Avi-Yonah (Michigan) 7,703
2 Dan Shaviro (NYU) 121,838 D. Dharmapala (Chicago) 4,901
3 Lily Batchelder (NYU) 118,829 Ruth Mason (Virginia) 4,561
4 Daniel Hemel (Chicago) 117,744 Lily Batchelder (NYU) 3,825
5 David Gamage (Indiana-Bloom.) 117,709 David Kamin (NYU) 3,399
6 Darien Shanske (UC-Davis) 110,971 Daniel Hemel (Chicago) 3,395
7 David Kamin (NYU) 106,965 Diane Ring (Boston College) 3,335
8 Cliff Fleming (BYU)    105,449 Bridget Crawford (Pace) 3,312
9 Manoj Viswanathan (Hastings) 102,444 Shu-Yi Oei (Boston College)  3,213
10 Rebecca Kysar (Fordham) 101,351 Hugh Ault (Boston College) 2,849
11 Ari Glogower (Ohio State) 100,202 Margaret Ryznar (Indiana-Indy)    2,413
12 Michael Simkovic (USC) 44,965 Richard Ainsworth (BU) 2,392
13 D. Dharmapala (Chicago) 42,797 David Gamage (Indiana-Bloom.) 2,139
14 Paul Caron (Pepperdine) 37,639 Dan Shaviro (NYU) 2,139
15 Louis Kaplow (Harvard) 34,026 Robert Sitkoff (Harvard) 1,838
16 Richard Ainsworth (BU) 31,102 Darien Shanske (UC-Davis)  1,823
17 Ed Kleinbard (USC) 27,305 Brad Borden (Brooklyn) 1,699
18 Vic Fleischer (UC-Irvine) 26,517 Louis Kaplow (Harvard) 1,505
19 Bridget Crawford (Pace) 25,565 Paul Caron (Pepperdine)   1,459
20 Jim Hines (Michigan) 25,434 Cliff Fleming (BYU) 1,345
21 Brad Borden (Brooklyn) 25,400 Katie Pratt (Loyola-L.A.) 1,255
22 Robert Sitkoff (Harvard) 25,216 Michael Simkovic (USC) 1,250
23 Ted Seto (Loyola-L.A.) 24,667 Ari Glogower (Ohio State) 1,230
24 Gladriel Shobe (BYU) 24,248 Yariv Brauner (Florida) 1,158
25 Katie Pratt (Loyola-L.A.) 24,015 Manoj Viswanathan (Hastings) 1,097

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December 16, 2020 in Legal Education, Scholarship, Tax, Tax Prof Rankings, Tax Scholarship | Permalink | Comments (0)

Crawford & Gerzog: Tax Benefits, Higher Education, And Race

Bridget J. Crawford (Pace) & Wendy C. Gerzog (Baltimore), Tax Benefits, Higher Education and Race: A Gift Tax Proposal for Direct Tuition Payments:

A tax system should be fair. According to conventional wisdom, this fairness mandate means that similarly situated taxpayers should pay similar taxes. Notably absent from most discussions about tax fairness is any consideration of race. This makes sense, if one focuses on the tax laws’ facial neutrality, as well as the Internal Revenue Service’s failure to collect official data about the race of taxpayers. But if one is interested in the “fairness,” as the word is commonly understood, of the tax law in action, then race and other identity characteristics must inform any analysis. This Article intervenes in the discussion of tax fairness with three principal claims: one descriptive, one normative, and one utilitarian.

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December 16, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Tuesday, December 15, 2020

Wiseman: Taxing Local Energy Externalities

Hannah Jacobs Wiseman (Penn State), Taxing Local Energy Externalities, 96 Notre Dame L. Rev. 563 (2020):

There is a fundamental problem of scale in the governance of industrial development. For some of the fastest-growing U.S. industries, the negative impacts of development fall primarily at the local level, and the benefits tend to accrue more broadly to states and the federal government. These governments accordingly have inadequate incentives to address the very localized negative externalities of development. Yet states also increasingly preempt most local control over some forms of development. This creates a regulatory void, in which state and federal regulations are inadequate, and local governments lack the power to use traditional Pigouvian tools such as regulation, taxation, and liability to address local harms. Without these Pigouvian sticks, local governments are also constrained in their use of Coasean bargaining, in which they could threaten regulation or taxation to bring industry to the table and negotiate for private solutions. This gap is particularly evident in the energy space, in which oil and gas and associated pipelines, wind energy, and solar energy have strong local effects, but local control is constrained to varying degrees.

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December 15, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Abramowicz & Blair-Stanek: Contractual Tax Reform

Michael Abramowicz (George Washington) & Andrew Blair-Stanek (Maryland), Contractual Tax Reform, 61 Wm. & Mary L. Rev. 1537 (2020):

One-size-fits-all taxation fails to accommodate diverse taxpayer circumstances. This Article proposes allowing taxpayers to contract into alternative tax regimes administered by private intermediaries. Participating taxpayers would make payments to the intermediaries pursuant to contract, and the intermediaries would be required to pay to the government at least as much as these taxpayers would have paid the government otherwise. That amount is determined based on the actual tax receipts of a control group, taxpayers who wish to contract with an intermediary but instead are chosen at random to continue under the status quo. These alternative tax regimes might better accommodate taxpayers’ preferences, leaving the taxpayers with greater utility, without reducing government revenue.

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December 15, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Call For Tax Papers And Panels: Law & Society Annual Meeting On Crisis, Healing, Re-Imagining

Neil Buchanan (Florida) has issued his annual call for tax papers and panels for next year's annual meeting of the Law & Society Association in Chicago (May 27 - 30, 2020):

Law & SocietyFor the seventeenth year in a row, I will organize sessions for the "Law, Society, and Taxation" group (Collaborative Research Network 31).  For the fifth year in a row, I am pleased to be carried along in these organizational efforts by Professors Jennifer Bird-Pollan and Mirit Eyal-Cohen.

The conference will mostly be held online, but LSA does hope to hold some events in person in Chicago for those who are willing and able to travel.  They are also indicating that they will take account of time zone differences in their scheduling. ...

Although there is an official call for papers, please remember that you are not bound by the official theme of the conference ("Crisis, Healing, Re-Imagining").  We will give full consideration to proposals in any area of tax law, tax policy, distributive justice, interdisciplinary scholarship, and so on.

The deadline for submissions is 11:59 p.m. ET (USA) on Thursday, January 7, 2021.

Please be aware that the online submission system has been changed significantly since last year.  (For what it's worth, I think the changes are all for the better.)  Please follow these instructions carefully:

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December 15, 2020 in Conferences, Legal Education, Scholarship, Tax, Tax Conferences, Tax Scholarship | Permalink | Comments (0)

Sunday, December 13, 2020

The Top Five New Tax Papers

There is quite a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with new papers debuting on the list at #2 and #4:

  1. SSRN Logo (2018)[490 Downloads]  State Aid: The General Court Decision in Apple, by Stephen Daly (King's College London) & Ruth Mason (Virginia) (reviewed by Young Ran (Christine) Kim (Utah) here)
  2. [423 Downloads]  A Simple Regulatory Fix for Citizenship Taxation, by John Richardson, Laura Snyder & Karen Alpert (University of Queensland)
  3. [347 Downloads]  Federal Tax Procedure (2020 Practitioner Ed.), by John Townsend
  4. [258 Downloads]  Tax Treaty Negotiations: Myth and Reality, by Yariv Brauner (Florida)
  5. [248 Downloads]  Rethinking The Estate Planning Curriculum, by Jeffrey Cooper (Quinnipiac)

December 13, 2020 in Scholarship, Tax, Tax Scholarship, Top 5 Downloads | Permalink | Comments (0)

Friday, December 11, 2020

Afield: Social Justice And The Low-Income Taxpayer

W. Edward Afield (Georgia State), Social Justice and the Low-Income Taxpayer, 64 Vill. L. Rev. 347 (2019):

Tax justice is social justice. To those regularly working to resolve tax controversies for low-income taxpayers and who are often dealing with the financial implications of life and death issues like human trafficking, the ability to afford medical care, and the risks of financial despair leading to suicide, this is an uncontroversial statement. To those for whom “tax attorney” is often the punchline to their favorite lawyer joke, however, this statement appears not to fit in with traditional conceptions of social justice. This is particularly true when social justice is defined as requiring not just improved access to representation in any type of legal matter but also as requiring specific societal outcomes that reduce poverty, improve housing access, combat racial discrimination, reduce hunger, and improve healthcare access. At first blush to those outside the tax bar who do not appreciate that most of these issues are inextricably linked to the tax system, tax justice does not appear to do any of these things. Accordingly, tax issues are often overlooked in the conversation about improving social justice.

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December 11, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (1)

The Uniform Basis Rules And Terminating Interests In Trusts Early

Lad Boyle (South Carolina), Howard M. Zaritsky ( & Ryan Wallace (Sojourner, Caughman & Thomas, Columbia, SC), The Uniform Basis Rules and Terminating Interests in Trusts Early, 55 Real Prop. Prob. & Tr. J. 1 (2020):

The resolution of income tax issues that may arise for trust beneficiaries who dispose of temporal interests in trusts remains relatively obscure. Additional issues exist for subsequent interest holders; the methods that the Code and Regulations prescribe for establishing, maintaining, and potentially recovering basis for successor owners of interests in a trust are not well developed.

In some instances, the trust instrument creating a temporal interest will supply a suitable path for early termination and distribution of assets. In those cases, Sub-chapter J of the Code typically governs the transaction and provides that terminating the trust and distributing its assets be treated as nonrecognition events. However, one must look beyond the confines of Sub-chapter J when trust beneficiaries participate in the disposition without a settlor-provided power to do so. The Internal Revenue Service has consistently applied in letter rulings a different tax regime other than the income tax rules provided in Sub-chapter J of the Code; gain may be realized and recognized under section 1001, which often brings into play the uniform basis rules.

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December 11, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Thursday, December 10, 2020

Holderness: Navigating 21st Century Tax Jurisdiction

Hayes R. Holderness (Richmond), Navigating 21st Century Tax Jurisdiction, 79 Md. L. Rev. 1 (2019):

Hailed as a massive victory for the states, the Supreme Court’s 2018 decision in South Dakota v. Wayfair, Inc. brought dated state tax jurisdiction standards into the twenty-first century, freeing the states to tax internet vendors. However, the decision left the larger state tax jurisdiction doctrine undertheorized and at a crossroads: Should the doctrine concern itself only with notice and fairness issues akin to those found in the due process personal jurisdiction realm, or should it also concern itself with protecting interstate commerce from undue state tax burdens? This Article will argue for the latter path by developing a robust theory of state tax jurisdiction that focuses on the potential undue burdens of tax compliance costs, burdens a threshold jurisdictional standard is uniquely able to address. From this compliance burden theory emerges a jurisdictional standard which would protect interstate commerce—particularly the activities of small businesses and entities that facilitate the commerce of others, such as online marketplaces, payment intermediaries, and common carriers—from the chilling effects of heavy state tax compliance costs.

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December 10, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Crawford: Blockchain Wills

Bridget J. Crawford (Pace), Blockchain Wills, 95 Ind. L.J. 735 (2020):

BlockchainBlockchain technology has the potential to radically alter the way that people have executed wills for centuries. This Article makes two principal claims – one descriptive and the other normative. Descriptively, the Article suggests that traditional wills formalities have been relaxed to the point that they no longer serve the cautionary, protective, evidentiary and channeling functions that scholars have used to justify strict compliance with wills formalities. Widespread use of digital technology in everyday communications has led to several notable cases in which individuals have attempted to execute wills electronically. These wills have had a mixed reception. Three states currently recognize electronic wills and the Uniform Law Commission is drafting a model Electronic Wills Act This Article identifies some of the weaknesses in existing state statutes and the model law and considers how technology can address those problems.

This Article explores how blockchain, the open-source technology underlying cryptocurrency like Bitcoin, could be harnessed to create a distributed ledger of wills that would maintain a reliable record of a testator’s desires for the post-mortem distribution of estate assets.

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December 10, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Spring 2021 Online Law Review Submission Guide

Bridget J. Crawford (Pace), Information for Submitting to Online Law Review Companions:

SubmissionsThis document contains information about submitting essays, commentaries, reviews, responses, and other writings to online companions to the main law reviews and journals at selected law schools. The document includes word-count limitations, subject matter specifications, preferred submission methods, whether articles from the online journal are included in HeinOnline’s Law Journal Library and other information of possible interest to authors. It covers 60 online companions to main law reviews.

December 10, 2020 in Legal Ed Scholarship, Legal Education, Scholarship | Permalink | Comments (0)

Kahn & Kahn: Recovery For Causing Tax Overpayment — Lyeth v. Hoey And Clark Revisited

Douglas A. Kahn (Michigan) & Jeffrey H. Kahn (Florida State), Recovery for Causing Tax Overpayment - Lyeth v. Hoey and Clark Revisited, 74 Tax Law. ___ (2021):

ABA Tax Lawyer (2019)The question has arisen in numerous cases as to the extent to which a settlement between arms’ length parties is dispositive in tax cases of the claims on which the settlement is based. Another issue that often arises is whether the receipt of compensation for a tax payment that was incurred because of the negligence of the payor is excluded from gross income. While those two issues were central to the proper resolution of a recent case in the United States Court of Appeals for the Eleventh Circuit, McKenny v. United States [No. 18-10810 (11th Cir. Sept. 30, 2020)], the court failed even to note one of those issues and did not resolve the other. The court’s failure to deal with those two issues led it to reach an incorrect result.

The two landmark cases establishing the doctrines that should have been applied in McKenny are the Supreme Court’s decision in Lyeth v, Hoey [305 U.S. 188 (1938)] and the decision of the Board of Tax Appeals (now known as the Tax Court) in Clark v. Commissioner [40 B.T.A. 333 (1939)]. Using McKenny as a springboard, this article reviews the continued misapplication and sometimes disparagement of the Lyeth v. Hoey and Clark v. Commissioner reasonings.

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December 10, 2020 in ABA Tax Section, Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

2020 Tannenwald Tax Writing Competition Winners

Tannenwald (2016)The Theodore Tannenwald, Jr. Foundation for Excellence in Tax Scholarship has announced the winners of the 2020 tax writing competition:

First Prize ($5,000):
Ryan Bullard (North Carolina), I Am “QOZ,” The Great and Terrible: A Policy Analysis of the Qualified Opportunity Zone Nominations Process
Faculty Sponsor:  Leigh Osofsky

Second Prize ($2,500):
Heydon Wardell-Burrus (Harvard), Blending Under A Global Minimum Tax
Faculty Sponsor:  Alvin C. Warren, Jr.

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December 10, 2020 in ABA Tax Section, Legal Education, Scholarship, Tax, Tax Scholarship, Teaching | Permalink | Comments (0)

Wednesday, December 9, 2020

Weisbach & Hemel: The Legal Envelope Theorem

David A. Weisbach (Chicago) & Daniel J. Hemel (Chicago), The Legal Envelope Theorem:

Non-tax legal rules regulating the workplace, the financial sector, real property, and many other areas affect the ability of governments to collect revenues and provide public goods. Yet tax-collection considerations rarely enter into economic analyses of non-tax legal rules. Usually, tax-collection concerns are shunted aside to separate studies (and separate law-school courses) rather than being integrated into debates in non-tax spheres. This separation between non-tax legal rules and tax-collection considerations bears significant negative consequences for the ability of law and economics to generate descriptively accurate and normatively attractive accounts of important non-tax legal questions.

This Article takes a step toward remedying that oversight. We present an analytic framework for understanding the interaction between non-tax legal rules and tax collection. This framework—which we call the Legal Envelope Theorem—demonstrates that legal rules should systematically deviate from simple notions of efficiency to take stock of tax effects.

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December 9, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Mason: Identifying Illegal Tax Subsidies

Ruth Mason (Virginia), Identifying Illegal Subsidies, 69 Am. U. L. Rev. 479 (2019):

This Article argues that current methods for identifying illegal tax subsidies trigger the well-known conceptual difficulties of tax-expenditure analysis. To avoid these problems—particularly the irresolvable conflict over the correct baseline for measuring tax expenditures and tax subsidies—this Article advocates the “internal consistency test” as a superior method for identifying illegal subsidies.

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December 9, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Hellerstein & Appleby: State Estate Taxes And The Due Process Clause

Walter Hellerstein (Georgia) & Andrew Appleby (Stetson), State Estate Taxes and the Due Process Clause, 98 Tax Notes State 771 (Nov. 23, 2020):

Tax Notes StateAfter two decades of relative dormancy, we are witnessing a resurgence in state estate tax controversies. Federal estate tax amendments beginning in 2001, which eliminated the federal credit for state estate taxes, greatly diminished the general significance of state estate taxes, as most states repealed their preexisting “pickup” or “sponge” taxes designed to absorb the maximum federal estate tax credit. Indeed, as of 2020, of the 50 states that had some form of federally based “death tax” in 2001, had no death tax at all and only 18 states had some form of death tax. Recently, however, five state courts have addressed the due process clause implications of state estate taxes. Each court considered the question of whether the due process clause permitted the state to impose estate tax on qualified terminable interest property. The U.S. Supreme Court has thus far declined to consider this question, having denied petitions for certiorari from two of the state court decisions that raised it (most recently just two weeks ago). In 2019, however, the Court did address a related state trust tax issue in Kaestner, which informs the QTIP due process analysis. ...

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December 9, 2020 in Scholarship, Tax, Tax Analysts, Tax Scholarship | Permalink | Comments (0)

Tuesday, December 8, 2020

Corporate Behavioral Responses To TCJA In 2017 And 2018

Tim Dowd, Christopher P. Giosa & Thomas Willingham (Joint Committee on Taxation, U.S. Congress), Corporate Behavioral Responses to TCJA for Tax Years 2017–2018:

We analyze the initial corporate response to the 2017 enactment of the “Tax Cuts and Jobs Act” or TCJA. TCJA changed many corporate tax provisions, including a reduction of the corporate statutory tax rate from 35 percent to 21 percent effective in 2018 and sweeping changes to the taxation of income earned abroad by U.S. corporations. Based on a sample of U.S. corporate tax returns, we find that corporations accelerated deductions into 2017 and delayed income into 2018, thereby minimizing their taxes. We estimate an income and deduction shifting tax elasticity of -0.11 and 0.08, respectively.

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December 8, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Trump’s Taxes: An Analysis Of The Allegations

Robert W. McGee (Fayetteville State University), Trump’s Taxes: An Analysis of the Allegations:

For years, the media and President Trump’s political opponents have been talking about the amount of taxes Trump pays (or doesn’t pay). As of this writing, his recent tax returns have not been released, so anything anyone says needs to be discounted. However, it is possible to make certain tentative statements and conclusions based on the facts that have been made available and the application of economic and political theory. The present paper does that.

December 8, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Thimmesch: States, The PPP, And Planning For Fiscal Shocks

Adam Thimmesch (Nebraska), States, the PPP, and Planning for Fiscal Shocks, 98 Tax Notes State 1029 (Dec. 7, 2020):

Tax Notes StateThis article is one in a series evaluating potential state responses to the COVID-19 pandemic. Prior articles in this series have focused on changes that the author and others recommend states make to both their personal and corporate income taxes, with a focus on provisions of the Coronavirus Aid, Relief, and Economic Security Act (P.L. 116-136) that make little sense for states to adopt in the midst of a global pandemic. This article focuses on the Paycheck Protection Program and the federal and state tax treatment of funds received by taxpayers under that program. The article is a part of Project SAFE (State Action in Fiscal Emergencies), an academic effort to help states weather the fiscal crisis by providing policy recommendations backed by research.

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December 8, 2020 in Scholarship, Tax, Tax Analysts, Tax Scholarship | Permalink | Comments (0)

Monday, December 7, 2020

Afield: Moving Tax Disputes Online Without Leaving Taxpayer Rights Behind

W. Edward Afield (Georgia State), Moving Tax Disputes Online Without Leaving Taxpayer Rights Behind, 74 Tax Law. ___ (2020):

ABA Tax Lawyer (2019)As the Service’s technological infrastructure continues to show its age, both the Service and Congress appear to be recognizing the importance of the Ser-vice having technological infrastructure that allows it to take advantage of the capabilities of modern computing systems to improve both its enforcement and service efforts. The National Taxpayer Advocate has entered this conversation as well, encouraging Congress and the Service to prioritize improvements to the Service’s technological infrastructure but simultaneously raising legitimate concerns about the impact that an overreliance on technology might have on taxpayer rights, particularly rights of vulnerable population groups who may not be able to utilize technology.

Fortunately, increasing technological deployment as part of taxpayer service is not a zero sum game that requires sacrificing taxpayer rights in the name of efficiency. The Service can accomplish the goal of deploying technology in a pro-taxpayer rights manner if it brings considerations of affirming taxpayer rights to the forefront of its deliberations about how best to utilize technology. Both the academic literature and Service strategic documents have focused on a wide variety of taxpayer interactions with the Service in proposing how this can be done. There is one type of interaction, however, that has thus far been underexplored both in the academic literature and in the Service’s strategic efforts to move more of its taxpayer interactions online: taxpayer controversy resolution.

This Article argues that the Service has insufficiently considered whether it can increase its use of technology-based interactions with taxpayers in the controversy-resolution process in a manner that both achieves efficiency gains and affirms taxpayer rights. Specifically, three areas in controversy resolution could lend themselves to such rights-affirming technological implementation.

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December 7, 2020 in ABA Tax Section, Scholarship, Tax, Tax Scholarship | Permalink | Comments (1)

Brauner: Tax Treaty Negotiations

Yariv Brauner (Florida), Tax Treaty Negotiations: Myth and Reality:

Tax treaties are the building blocks of the international tax regime. There are currently over 3000 tax treaties that regulate the lion’s share of cross-border investment. They are largely fashioned after a single model reflecting an increasing convergence of international tax norms. Despite this convergence, and despite the passing of nearly a century from when the first modern tax treaties were formalized into a model, there remains a great many unanswered fundamental questions about their application, interpretation, and effectiveness.

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December 7, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Sunday, December 6, 2020

Rossotti, Sarin & Summers: A Comprehensive Approach To Shrinking The Tax Gap

Charles O. Rossotti, Natasha Sarin (Pennsylvania) & Lawrence H. Summers (Harvard), Shrinking the Tax Gap: A Comprehensive Approach, 169 Tax Notes Fed. 1467 (Nov. 30, 2020):

Over the course of the past year, we have written independently about the substantial revenue potential of a significant investment in tax compliance. In several articles, we have estimated that overhauling the IRS — by increasing effectively allocated examination resources, filling the holes in information reporting of income that cannot now be cross-checked against third-party reports, and investing in technology so the IRS is better able to leverage the information it collects — can raise well over $1 trillion.

Table 2

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December 6, 2020 in Scholarship, Tax, Tax Analysts, Tax Scholarship | Permalink | Comments (0)

The Top Five New Tax Papers

There is quite a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with new papers debuting on the list at #3 and #5:

  1. SSRN Logo (2018)[463 Downloads]  State Aid: The General Court Decision in Apple, by Stephen Daly (King's College London) & Ruth Mason (Virginia) (reviewed by Young Ran (Christine) Kim (Utah) here)
  2. [328 Downloads]  Federal Tax Procedure (2020 Practitioner Ed.), by John Townsend
  3. [234 Downloads]  Is It Time to Eliminate Federal Corporate Income Taxes?, by Edward Lane (Albany) & Randall Wray (UMKC),
  4. [209 Downloads]  An Analysis of Vice President Biden’s Economic Agenda: The Long Run Impacts of Its Regulation, Taxes, and Spending, by Timothy Fitzgerald (Texas Tech), Kevin Hassett (Hoover Institution), Cody Kallen (Wisconsin) & Casey Mulligan (Chicago)
  5. [188 Downloads]  Rethinking The Estate Planning Curriculum, by Jeffrey Cooper (Quinnipiac)

December 6, 2020 in Scholarship, Tax, Tax Scholarship, Top 5 Downloads | Permalink | Comments (0)

Friday, December 4, 2020

Weekly SSRN Tax Article Review And Roundup: Elkins Reviews Tax Policy And Pharmaceutical Innovation By Eyal-Cohen & Rutschman

This week, David Elkins (Netanya) reviews a recently posted work by Mirit Eyal-Cohen (Alabama) & Ana Santos Rutschman (St. Louis), Tax Policy and Pharmaceutical Innovation (2020):

Elkins (2018)

With so much of the world’s attention this year focused on the COVID-19 pandemic, it is little wonder that tax scholars too have waded into the breach. A quick search on SSRN turns up no less than 146 articles containing the key words “COVID” and “tax.” However, most of these articles are concerned either with the tax implications of the current pandemic or with what the government should do within the field of taxation in light of the economic havoc created by the virus and by the shutdowns and other measures instituted in an attempt to keep it at bay. This week’s article, co-authored by a tax law scholar and a public health law scholar, takes a step back and asks how the tax system can help prevent the next pandemic.

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December 4, 2020 in David Elkins, Scholarship, Tax, Tax Scholarship, Weekly SSRN Roundup, Weekly Tax Roundup | Permalink | Comments (0)

Satterthwaite: Tax Signaling

Emily A. Satterthwaite (Toronto), Tax Signaling, 75 Tax L. Rev. ___ (2021):

NYU Law (2016)A job applicant’s investment in education can function as a signal of her high productivity under certain circumstances. Might an entrepreneur’s choice to opt-in to a tax regime act in much the same way, as a signal of her business’s high quality? This paper explores the counter-intuitive notion that paying more tax than is legally required can be a signature of successful businesses. It uses as its jumping-off point recent evidence from both the United Kingdom and Canada that small-firm entrepreneurs view registering voluntarily for their countries’ value-added taxes (“VATs”) as enhancing their businesses’ reputations and legitimacy.

To make sense of these seemingly-disadvantageous tax choices, the paper introduces the notion of “tax signaling.” Its thesis has two parts. First, despite an apparent conflict, the signaling account of voluntary VAT registration complements the standard profit-maximizing account of voluntary registration offered by economists. Second, it argues that signaling is normatively desirable. Signaling reflects and, in turn, reinforces a high-trust-low-enforcement taxpaying equilibrium among businesses that are least likely to pay VAT voluntarily. This equilibrium generates a number of positive spillovers, including better matching of firms with counterparties, reduced competitive distortions between VAT-registered versus unregistered firms, and increased tax revenue at low administrative cost.

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December 4, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Thursday, December 3, 2020

Florida Tax Review Publishes New Issue

The Florida Tax Review has published Vol. 23, No. 1:

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December 3, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Political Affiliation In The Selection Of Opportunity Zones

Mary Margaret Frank (Virginia), Jeffrey L. Hoopes (North Carolina) & Rebecca Lester (Stanford), What Determines Where Opportunity Knocks? Political Affiliation in the Selection of Opportunity Zones:

We examine the role of political affiliation during the selection of Opportunity Zones, a place-based tax incentive enacted by the Tax Cuts and Jobs Act of 2017. We find governors are on average 7.6% more likely to select a census tract as an Opportunity Zone when the tract’s state representative is a member of the governor’s political party. Further, we find that this effect ranges from 0.0% to 25.6% depending on the state-level information channels governors used to select Opportunity Zones, such as engagement of professional advisors and implementation of public comment procedures. These effects are incremental to local demographic factors that increased the likelihood of selection, such as lower income levels and preceding improvements in local conditions.

Opportunity Zones

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December 3, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Mazur & Thimmesch: Closing The State Tax Digital Divide — A Consumption Tax Agenda

Orly Mazur (SMU) & Adam Thimmesch (Nebraska), Closing the Digital Divide in State Taxation: A Consumption Tax Agenda, 98 State Tax Notes ___ (Nov. 30, 2020):

Tax Notes StateIn this installment of Academic Perspectives on SALT, Mazur and Thimmesch argue that while taxing digital goods and services presents practical and legal challenges for states, it is still a worthwhile measure to address the pandemic and related budget problems.

Expanding the consumption tax base to digital consumption is a relatively easy way for states to raise essential tax revenue as they cope with the pandemic and its accompanying economic downturn. Although a digital tax is an imperfect solution and requires overcoming some practical and legal issues, implementing one on consumption is better than the alternative of maintaining the status quo. Under the current patchwork of state laws, digital activities either escape taxation or are only partially and inconsistently taxed. This complex system can place onerous burdens on suppliers, results in governments losing out on a growing revenue stream, contributes to discriminatory and multiple taxation, and does not reflect the economic realities of the digital era. Given the current situation and the tough times ahead, it is worthwhile for states to implement digital taxes on consumption now.

The digital tax debate is far from over, and expanding the consumption tax base is just the first step. The wide range of attention being paid to DSTs and their various forms should not detract from this basic point: A broad, neutral, and strong state tax base is one that includes digital transactions.

December 3, 2020 in Scholarship, Tax, Tax Analysts, Tax Scholarship | Permalink | Comments (0)

Appleby: Designing The Tax Supermajority Requirement

Andrew D. Appleby (Stetson), Designing the Tax Supermajority Requirement, 71 Syracuse L. Rev. ___ (2021):

States are rekindling the trend of broad constitutional amendments that require supermajority approval to create or increase taxes. This trend may inadvertently harm states’ already precarious fiscal footing, particularly with several new imminent expenditure demands. States can minimize negative economic consequences, however, through proper supermajority requirement design.

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December 3, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Wednesday, December 2, 2020

Avi-Yonah Presents COVID-19 And U.S. Tax Policy Virtually Today At Utah

Reuven Avi-Yonah (Michigan) presents COVID-19 and U.S. Tax Policy: What Needs to Change? virtually today at Utah as part of its Faculty Workshop Series hosted by Young Ran (Christine) Kim:

Avi yonahThe COVID-19 Pandemic already feels like a historical turning point akin to Word Wars I and II and the Great Depression. It may signal the end of the second period of globalization (1980-2020) and a change in the relative positions of the US and China. It could also lead in the US to significant changes in tax policy designed to bolster the social safety net which was revealed as very porous during the pandemic. In what follows I will first discuss some short-term effects of the pandemic and then some potential longer-term effects on US tax policy.

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December 2, 2020 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink | Comments (0)

The Alleged WTO Law Incompatibility Of Destination-Based Taxes

Alice Pirlot (Oxford), Don't Blame It on WTO Law: An Analysis of the Alleged WTO Law Incompatibility of Destination-Based Taxes, 23 Fla. Tax Rev. 432 (2019):

Florida Tax Review (2019)The idea that corporations should be taxed in the jurisdiction where they make their sales or provide their services is getting more and more attention in the policy debate on international taxation. In 2016, U.S. House Speaker Paul Ryan proposed to introduce a destination-based cash flow tax (DBCFT) in order to reform America’s corporate income tax (CIT). Moreover, in the last few years, more and more countries have considered the adoption of new rules to tax the digital economy in the country where the users and/or the consumers are located.

These proposals differ from traditional direct taxes imposed on corporations. They borrow from the tax design of indirect taxes, such as sales taxes or value added taxes. Consequently, it is difficult to predict whether these sui generis destination-based taxes will fit in with superior legal provisions, in particular international tax and trade law. One recurring legal argument against destination-based taxes is that they are likely to violate the law of the World Trade Organisation (WTO).

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December 2, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Tuesday, December 1, 2020

Scharff Presents Revisiting Local Income Taxes Virtually Today At NYU

Erin Scharff (Arizona State) presents Revisiting Local Income Taxes (with Darien Shanske (UC-Davis)) virtually at NYU today as part of its Tax Policy Colloquium Series hosted by Lily Batchelder and Daniel Shaviro:

6a00d8341c4eab53ef0240a4e58128200d-150wiIt has been decades since legal scholarship has seriously explored the role of income tax laws in municipal finance, but recent federal and state court cases are changing the laws related to municipal income taxation. At the same time, local governments are increasingly searching for new sources of revenue, especially as they face increasing pension obligations and increasing maintenance costs on aging infrastructure. Independently, and in part as a response to rising income inequality, there has been a resurgence in interest in progressive taxation. So far, however, this political moment has not resulted in significant reforms to local tax policy, in large part because of the limited authority local governments often have under state law. As local activists and policymakers begin to think about how to rebuild city budgets post-Covid, they will once again be looking for new local revenue options.

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December 1, 2020 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink | Comments (0)

Brown: Can Anyone Be Trusted To Enforce National Treatment Disciplines With Respect To Tax Measures?

Patricia Brown (Miami), Can Anyone Be Trusted to Enforce National Treatment Disciplines with Respect to Tax Measures?, 23 Fla. Tax Rev. 193 (2019):

Florida Tax Review (2019)Because the traditional non-discrimination article of tax treaties seem­ingly provides protection against only the most blatant discrimination against non-residents and non-nationals of a taxing State, governments may be emboldened to adopt “anti-abuse” rules that are in reality dis­guised trade barriers. On the other hand, trade disciplines in non-tax agreements may include protections against discriminatory taxes that non-specialist courts interpret in expansive ways, contrary to the wishes of tax authorities. An OECD project in the mid-2000s was an opportu­nity for governments to re-think the piecemeal nature of the traditional non-discrimination article in tax treaties and develop a coherent national treatment system that takes into account legitimate tax policy concerns. Instead, the project resulted in a mishmash of changes that largely blessed the various discriminatory practices that governments had adopted to that date.

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December 1, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Grinberg: Stabilizing 'Pillar One' — Corporate Profit Reallocation In An Uncertain Environment

Itai Grinberg (Georgetown), Stabilizing 'Pillar One': Corporate Profit Reallocation in an Uncertain Environment, 23 Fla. Tax Rev. 130 (2019):

Florida Tax Review (2019)This paper is about how the world reestablishes international tax order.

The paper focuses on the OECD’s work on profit reallocation and asks whether this multilateral effort can be successful in stabilizing the international tax system. The analysis centers on the current leading concepts for reallocating profit among jurisdictions under what is known as “Pillar One” of the OECD work programme. To analyze whether any Pillar One concept can be turned into a stable multilateral regime, it is necessary to specify certain elements of what a proposal to reallocate profits might entail. Accordingly, this paper sets out two strawman proposals. One strawman uses a “market intangibles” concept that explicitly separates routine and residual returns. The other strawman may reach a similar result, but does not explicitly attempt to separate routine and residual returns. Instead, in current OECD parlance, it might be described as a “distribution-based” approach.

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December 1, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Monday, November 30, 2020

Duke Symposium: Law And Macroeconomics

Law and Contemporary Problems (2020)

Symposium, Law and Macroeconomics, 83 Law & Contemp. Probs. 1-232 (2020):

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November 30, 2020 in Conferences, Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Aprill: Revisiting Federal Tax Treatment Of States, Political Subdivisions, And Their Affiliates

Ellen P. Aprill (Loyola-L.A.), Revisiting Federal Tax Treatment of States, Political Subdivisions, and their Affiliates, 23 Fla. Tax Rev. 73 (2019):

Florida Tax Review (2018)Several provisions of the 2017 tax legislation, known as Tax Cuts and Jobs Act (TCJA), focused attention on federal taxation of states, their political subdivisions and their affiliates. Most prominently, TCJA limited the federal income tax deduction for state and local taxes to $10,000. States have sued and attempted work-arounds. Another provision, which imposes an excise tax of 21% on “excessive compensation” paid by certain entities not subject to income tax, inadvertently failed to subject to tax entities that are integral parts of states or political subdivisions or are themselves political subdivisions. Calls for a technical correction have so far gone unheeded.

More than twenty years ago, I wrote two articles about federal taxation of state governments, political subdivisions, and their affiliates. The Teacher’s Manual to a leading casebook on nonprofit organizations describes these two articles as “as much as anyone knows about this confusing patchwork and its ramifications.” The passage of time, changes in my own thinking and new developments call for my returning to this topic. I do so here. Moreover, far more than in my earlier work, I examine the applicable rules regarding charitable contribution deductions to these entities as well as discuss the special rules applicable to governmental charities and the category of charities that lessen the burdens of government.

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November 30, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Lesson From The Tax Court: The Right Way To Do Conservation Easements

Tax Court (2020)Over 40 years ago, Congress modified §170 to permit deductions for donations of partial interests in land when such donations advanced an important public purpose such as protecting environmentally or historically important land from development.  Starting in the early 2000’s, however, developers and tax shelter promoters began exploiting conservation easements to provide huge tax deductions for donations that provided little or no conservation benefit.  The problem reached the point that the IRS issued Notice 2017-10 which described certain syndicated conservation easement arrangements and listed them as tax shelter transactions. This informative Senate Finance Committee Report from August 2020 details the abuses.

But not all conservation easements are tax shelters.  Kumar Rajagopalan and Susamma Kumar v. Commissioner, T.C. Memo. 2020-159 (Nov. 19, 2020) (Judge Holmes) shows how taxpayers can properly deduct the donation of a conservation easement if they have good planning, good representation, and good luck.  Details below the fold.

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November 30, 2020 in Bryan Camp, New Cases, Scholarship, Tax, Tax Practice And Procedure, Tax Scholarship | Permalink | Comments (1)

Choi, Curtis & Hayashi: Crisis-Driven Tax Law — The Case Of Section 382

Albert H. Choi (Michigan), Quinn Curtis (Virginia) & Andrew T. Hayashi (Virginia), Crisis-Driven Tax Law: The Case of Section 382, 23 Fla. Tax Rev. 1 (2019):

Florida Tax Review (2019)At the peak of the 2008 financial crisis, the Internal Revenue Service (IRS) issued Notice 2008-83 (the Notice), administrative guidance that limited Internal Revenue Code (the Code) section 382, an important tax rule designed to discourage tax-motivated acquisitions. Although styled as a mere interpretation of existing law, the Notice has been widely viewed as an improper exercise of the IRS's authority that undermined its legitimacy. But did the Notice work? There were many extraordinary interventions during the financial crisis that raised questions about eroding the rule of law and the long-term destabilizing effects of bailouts. In a financial crisis, regulators must weigh these real, but distant and uncertain, costs against the immediate benefits of the intervention. Toward that end, we report the first evidence of the effects of limiting Code section 382 during the 2008 financial crisis.

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November 30, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Sunday, November 29, 2020

The Top Five New Tax Papers

This week's list of the Top 5 Recent Tax Paper Downloads is the same as last week's list:

  1. SSRN Logo (2018)[447 Downloads]  State Aid: The General Court Decision in Apple, by Stephen Daly (King's College London) & Ruth Mason (Virginia) (reviewed by Young Ran (Christine) Kim (Utah) here)
  2. [304 Downloads]  Federal Tax Procedure (2020 Practitioner Ed.), by John Townsend
  3. [272 Downloads]  Intangibles and the Transfer Pricing Reconstruction Rules: A Case Study of Amazon, by Antony Ting (Sydney)
  4. [190 Downloads]  An Analysis of Vice President Biden’s Economic Agenda: The Long Run Impacts of Its Regulation, Taxes, and Spending, by Timothy Fitzgerald (Texas Tech), Kevin Hassett (Hoover Institution), Cody Kallen (Wisconsin) & Casey Mulligan (Chicago)
  5. [170 Downloads]  Why Is So Much Redistribution In-Kind and Not in Cash? Evidence from a Survey Experiment, by Zachary Liscow (Yale) & Abigail Pershing (J.D. 2020, Yale)

November 29, 2020 in Scholarship, Tax, Tax Scholarship, Top 5 Downloads | Permalink | Comments (0)

Saturday, November 28, 2020

Czapanskiy: Tax Policy, Structured Settlements, And Factoring

Karen Czapanskiy (Maryland), Tax Policy, Structured Settlements and Factoring: Making Exploitation Easy and Profitable, 93 U. Detroit Mercy L. Rev. 455 (2020):

Secondary sales of streams of income payable under structured settlements of tort claims are such a disfavored transaction that Congress imposed a punitive 40 percent excise tax on them. These “factoring transactions” are disfavored because it is believed that payees are likely to be exploited, to dissipate the lump sum which is paid for the stream of income and to become dependent on taxpayers when payees become indigent as a result. Congress was also persuaded that state courts could keep an eye on the problems, however, so the 40 percent excise tax is excused if the transaction is approved by a state court in a proceeding under a state “Structured Settlement Protection Act” or SSPA.

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November 28, 2020 in Scholarship, Tax | Permalink | Comments (0)

Thursday, November 26, 2020

Modern Call For A Renewed Commitment To Charitable Giving

Joey Bloodworth (J.D. 2020, USC), Note, Charity for All: A Modern Call for a Renewed Commitment to Charitable Giving, 93 S. Cal. L. Rev. 273 (2020):

This Note will center on the TCJA’s unpopularity, the charitable contribution deduction, and the adverse effect the TCJA is projected to have on charitable giving. It will conclude that now is an optimal time to expand the charitable contribution deduction. The expansion of the charitable contribution deduction would likely be popular for many of the same reasons that the TCJA is currently unpopular. The proposed expansion will also address some of the problems with charitable giving created or exacerbated by the TCJA. ...

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November 26, 2020 in Legal Ed News, Scholarship, Tax, Tax Scholarship | Permalink | Comments (0)

Wednesday, November 25, 2020

Oei & Osofsky: The Making Of The § 199A Regulations

Shu-Yi Oei (Boston College) & Leigh Osofsky (North Carolina), Legislation and Comment: The Making of the § 199A Regulations, 69 Emory L.J. 209 (2019):

In 2017, Congress passed major tax legislation at warp speed. After enactment, it fell to the Treasury Department to write regulations clarifying and implementing the new law. To assure democratic legitimacy in making regulations, administrative law provides that an agency must issue a notice of proposed rulemaking, followed by an opportunity for the public to comment (socalled “notice and comment”). But, after the 2017 tax overhaul, many sophisticated actors did not wait until the issuance of a notice of proposed rulemaking to comment, instead going to the Treasury Department immediately with comments designed to influence the regulations.

In this Article, we examine empirically this phenomenon of post-enactment commenting by studying the making of the Internal Revenue Code Section 199A regulations—some of the most important regulations implementing the 2017 tax reform.

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November 25, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (1)

It Is Time To Eliminate The Federal Corporate Income Tax

Edward Lane (Albany) & L. Randall Wray (UMKC), Is It Time to Eliminate Federal Corporate Income Taxes?:

As the nation is experiencing the need for ever-increasing government expenditures to address COVID-19 disruptions, rebuild the nation’s infrastructure, and many other worthy causes, conventional thinking calls for restoring at least a portion corporate taxes eliminated by the 2017 Tax Cuts and Jobs Act, especially from progressive circles. In this working paper, Edward Lane and L. Randall Wray examine who really pays the corporate income tax and argue that it does not serve the purposes most people believe.


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November 25, 2020 in Scholarship, Tax, Tax Scholarship | Permalink | Comments (6)