Paul L. Caron

Monday, March 4, 2024

Dorothy Brown And Steven Dean Question Biden Administration's Commitment To Addressing Systemic Racial Bias In The Tax Code

Tax Notes, Treasury Accused of Stonewalling Equity Agenda:

Treasury Department (2019)Dorothy Brown of the Georgetown University Law Center, a proponent of Treasury collecting race statistics to address tax code inequalities, feels seen but not heard as a member of the department's Advisory Committee on Racial Equity.

Brown, author of The Whiteness of Wealth: How the Tax System Impoverishes Black Americans — And How We Can Fix It, was one of 24 individuals chosen as part of Treasury’s newly created group, known as TACRE, and was named co-chair of its Data and Equity Research Subcommittee.

“The structure actually made sense. Having four, five members in each subcommittee allowed us to get a lot done,” Brown said, adding that her subcommittee made two recommendations: for Treasury to address racial equity in its annual green book and for Treasury and the IRS to send data to the U.S. Census Bureau to publish a comprehensive report on tax and race.

While both proposals were approved by the overall committee in March 2023 and sent to Treasury Secretary Janet Yellen for consideration, there has yet to be a response.

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March 4, 2024 in IRS News, Legal Ed News, Legal Education, Tax, Tax Daily, Tax News | Permalink

Saturday, March 2, 2024

There Are 340,000 Fewer Accountants, And Companies Are Paying The Price

Following up on my previous posts:

Bloomberg, There Are 340,000 Fewer Accountants, and Companies Are Paying the Price:

Mistakes continued to pile up this earnings season in the wake of Lyft Inc.’s market-roiling typo: Planet Fitness Inc., Mister Car Wash Inc. and Rivian Automotive Inc. all had to correct their quarterly earnings statements. These types of errors shake investor confidence and in extreme cases can result in heavy fines from the US Securities and Exchange Commission.

While it’s unclear what exactly led to the mistakes in each of these cases, one major risk factor has reached crisis levels: a shortage of certified public accountants.

Bloomberg Accountants

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March 2, 2024 in Tax, Tax Daily, Tax News | Permalink

Friday, March 1, 2024

Tax Policy In The Biden Administration

Monday, February 26, 2024

Winners Of The 23rd Annual Law Student Tax Challenge

ABA Tax Section, Winners Of The 23rd Annual Law Student Tax Challenge:

ABA_Tax_ChampsJ.D. Division 

1st Place: 
Natalie Romano-Nuesch and Victor Ficarra (right)

2nd Place: 
Emmanuel Backus and Logan Wagner
West Virginia

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February 26, 2024 in ABA Tax Section, Legal Education, Tax, Tax Daily, Tax News, Teaching | Permalink

Inside The IRS Unit Taking On America’s Millionaires And Billionaires

International Consortium of Investigative Journalists, Inside the IRS Unit Taking on America’s Millionaires and Billionaires:

IRS Logo (2023)A pair of Internal Revenue Service agents are attempting to interview a billionaire they suspect of cheating on his taxes. But across the table from the agents is a formidable entourage of esteemed tax professionals hired to defend the billionaire. They include white-shoe attorneys — each of whom knows more about their own arcane corner of tax law than just about anyone on earth — along with highly specialized accountants and economists.

Neither of the two IRS agents has a law degree. Complex arguments from the billionaire’s entourage fly over their heads. The IRS agents are outmatched by a team whose combined years of experience in tax law and accounting exceed their own by over a century.

This stark example, laid out by former IRS officials in interviews with the International Consortium of Investigative Journalists, isn’t a hypothetical so much as a glimpse into the agency’s regular challenges in auditing the United States’ highest earners. These battles often come down to experience and expertise. The IRS has been losing, former officials said.

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February 26, 2024 in IRS News, Tax, Tax Daily, Tax News | Permalink

Friday, February 23, 2024

Tax Policy In The Biden Administration

T-Bills Without Tax Bills? 'Poster Child For Tax Arbitrage' Or 'Democratization Of Tax Dodges'?

Bloomberg, T-Bills Without Tax Bills? This Fund Says It Cracked the Code:

BoxxA Marine Corps veteran with a finance Ph.D. has come up with a new way to avoid taxes.

Any American holding US government securities has to pay income taxes on the interest they generate. For the richest investors, the Internal Revenue Service’s cut is 37%.

But a year-old investment fund offers returns that closely track short-term Treasuries, with starkly lower tax bills. The fund, Alpha Architect 1-3 Month Box ETF, uses a complex options strategy and a longstanding tax loophole that favors exchange-traded funds.

“We spent seven years figuring out how to do this,” said Wesley Gray, the ex-Marine and chief executive officer of Alpha Architect. “My job is just to deliver all the value I possibly can to my shareholders, within the law.”

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February 23, 2024 in Tax, Tax News | Permalink

Thursday, February 22, 2024

U.S. Tax Court's Tax Trailblazers: Alice Thomas

U.S. Tax Court's Diversity & Inclusion Series, Tax Trailblazers: Mentoring the Next Generation (registration):

Alice thomasPlease join the United States Tax Court as its Tax Trailblazers series continues with Howard Law Professor Alice Thomas, today at 7:00 - 8:15 PM EST (register here). 

Professor Alice Martin Thomas is a tenured associate professor of law at Howard University School of Law where she heads the tax program and teaches federal tax, contracts, and commercial law subjects. She is an inaugural member of the Loretta Argrett ABA Tax Fellowship. She also is a Carnegie Scholar with the Carnegie Foundation for the Advancement of Teaching and Learning and the former Interim Director of the Howard University Center for Excellence in Teaching, Learning, and Assessment.

Professor Thomas attended Washington University in St. Louis, earning a Double Major in Psychology and Black Studies, and a Minor in Biology.

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February 22, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News | Permalink

Tuesday, February 20, 2024

California's High Taxes Are Driving The Wealthy Away

Bloomberg Op-Ed:  California's High Taxes Are Driving The Wealthy Away, Tyler Cowen (George Mason; Google Scholar):

Some Americans like to mock France and Sweden for their high taxes. Yet California — whose economy is bigger than that of both countries — has comparable tax rates, when federal and state tolls are combined, and a new study suggests that they are causing some top earners to leave the state entirely [Joshua Rauh (Stanford; Google Scholar) & Ryan Shyu (Stanford), Behavioral Responses to State Income Taxation of High Earners: Evidence from California, 16 Amer. Econ. J. 34 (Feb. 2024)].

This is an issue for more than America’s 39 million Californians. Despite the long-held consensus among many analysts that state-level tax rates don’t matter much, some states seemed to have reached a point at which tax rates are driving many residents’ decisions. That raises the question of whether taxes can continue to rise without significant negative economic consequences. ...

How are residents fighting back? In part by leaving. California had a net population loss of more than 700,000 from April 2020 to July 2022. Some of that was likely pandemic-driven, but the trend has not reversed.

Bloomberg CA

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February 20, 2024 in Tax, Tax News | Permalink

Friday, February 16, 2024

Tax Policy In The Biden Administration

Monday, February 12, 2024

The Only Higher Ed Employee To Give $1,000 Or More To Trump's 2024 Campaign: A Tax Professor

The Center Square, Of All The Professors in the Country, One Guy in South Dakota Stood Up for Trump:

EischenErich Eischen is unique.

According to Federal Election Commission data, he is the only person who lists his employer as a college or university in the United States who made a contribution of $1,000 or more to Donald Trump's presidential campaign so far in the 2024 election cycle.

Such donors are a dime a dozen for President Joe Biden. There are 289, in fact, according to the FEC, Biden has more higher ed support at the University of California alone, than Trump has in the whole country. And Biden's support comes from schools that will tell you they are the most prestigious—Cornell, Stanford, Johns Hopkins, Harvard, Yale, Penn, NYU, Georgetown and on and on.

Where does Trump's single big dollar contribution come from? A Dakota State University tax and accounting instructor. According to the school's website, he teaches introductory tax and accounting classes as well as more advanced courses. ...

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February 12, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News | Permalink

Friday, February 9, 2024

Tax Policy In The Biden Administration

NY Times: There’s A Tax Season Villain, And It’s Not The IRS

New York Times, There’s A Tax Season Villain, and It’s Not the I.R.S.:

It’s the most miserable time of the year: tax season.

Americans are about to spend millions of hours and billions of dollars filing their federal income taxes, and they are pretty sure they know who is responsible for their pain: The misanthropes at the Internal Revenue Service.

But we’re here to convince you that the I.R.S. is not the problem.

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February 9, 2024 in IRS News, Tax, Tax Daily, Tax News | Permalink

Monday, February 5, 2024

2023 Tax Court Statistics

Andrew Mitchel, Tax Court Statistics - 2023:

The Tax Court has substantially reduced the number of opinions that it publishes each year.

In 1996, the Tax Court published 553 Memorandum Opinions. In 2023, the Tax Court published 154 Memorandum Opinions, a 72% decrease.


Below is a chart of the number of opinions issued by each Tax Court judge in 2023.

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February 5, 2024 in Tax, Tax Daily, Tax News | Permalink

Saturday, February 3, 2024

Harvard Faces New Threat Of State Tax On Its $51 Billion Endowment

Bloomberg, Harvard Faces New Threat of State Tax on $51 Billion Endowment:

Harvard (2016)Harvard University is bracing for two bills in its home state of Massachusetts this year that would target the school’s massive $51 billion endowment and policy of admitting legacy applicants.

One would hit Harvard and 10 other private colleges that have more than $1 billion in assets, including the Massachusetts Institute of Technology and Williams College, with an annual 2.5% excise tax to fund state universities.

A second bill would charge a fee on rich colleges that give legacy applicants a leg up in admissions and pass along the funds collected to community colleges.

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February 3, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News | Permalink

Friday, February 2, 2024

Tax Policy In The Biden Administration

Apple Vision Pro Drops Today. Can You Deduct It?

Steven Chung (Tax Attorney, Los Angeles), You Must Know These Tax Rules If You Plan To Write Off Your Purchase Of The Apple Vision Pro:

Vision ProAs with most new Apple products, the [Vision Pro]  has generated a lot of hype. Supposedly, it allow users to experience various forms of virtual reality and be able to do computer tasks without the confines of a monitor.

But at a minimum price tag of $3,499 plus sales tax for the basic model, not everyone will be able to buy it. The target audience seems to be wealthy Apple fans, nonwealthy Apple superfans who will purchase it on credit with their Apple Card, social media influencers hoping to flex it to get more clicks and followers, and businesses.

While its business use has not been established, businesses seem to have several reasons to purchase it for their operations. They may find it useful for recruiting younger people who would be attracted to the newest tech products and are generally tech savvy. Or they might be able to use it to help employees with disabilities be more productive. Also, the purchase could be tax deductible as a business expense.

Some people might want to minimize the cost of major purchases by treating the purchase as a business expense and reduce their tax bill. But before people run out to start a business and write off the purchase of the Vision Pro as a business expense, there are a few tax rules you should know about.

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February 2, 2024 in Tax, Tax Daily, Tax News | Permalink

Thursday, February 1, 2024

Taylor, Travis, And Taxes: Addressing The Environmental Cost Of Private Jet Travel

Washington Post, Why the Idea of Taylor Swift’s Super Bowl Jet Trip Is Sparking Controversy:

Flying on a private jet is one of the most carbon-polluting ways to travel. Legal scholars and lawmakers are calling for taxes to address the environmental cost.

Few celebrities have had their jet travel come under as intense scrutiny in recent months as Taylor Swift, who has crisscrossed the country in a private plane to watch her boyfriend Travis Kelce play for the Kansas City Chiefs. Fox News blasted her on Sunday as she arrived in Baltimore to attend the AFC championship game, tweeting that her jet was “belching tons of CO2 emissions.”

Private jet trips rank as the most carbon-intensive ways to travel, generating nine times as much carbon per passenger as flying commercial, according to a 2023 paper from University College London. And now that the Chiefs have made it to the Super Bowl, many are wondering whether Swift will fly the roughly 14,000 miles it would take to get from a concert in Tokyo on Feb. 10 to the game in Las Vegas on Feb. 11 and then to Melbourne in time for her next show on Feb. 16, reigniting the debate over whether owners of private planes should be held responsible for the planet-warming emissions they generate. ...

Swift’s publicist has said she buys carbon offsets to compensate for her jet travel, but didn’t respond to a request for more detail about what kind or how many offsets the artist has bought. There’s a wide range in quality and oversight in the offset market, and many offsets are meaningless.

But legal scholars and Congress members are pushing for another way to make private jet owners such as Swift pay for their emissions: taxes.

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February 1, 2024 in Celebrity Tax Lore, Tax, Tax Daily, Tax News | Permalink

Wednesday, January 31, 2024

NY Times: Former Contractor Who Leaked Trump’s Tax Returns Sentenced To 5 Years In Prison

New York Times, Former Contractor Who Leaked Trump’s Tax Returns Sentenced to 5 Years in Prison:

A former Internal Revenue Service contractor accused of leaking the tax documents of Donald J. Trump and other wealthy Americans was sentenced on Monday to five years in prison.

The former contractor, Charles Littlejohn, known as Chaz, worked for the tax agency from 2017 to 2021, when he stole the tax records of thousands of the country’s wealthiest people, including Mr. Trump, prosecutors said. Mr. Littlejohn then provided the information to The New York Times and ProPublica.

Prosecutors said his actions “appear to be unparalleled in the I.R.S.’s history.”

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January 31, 2024 in IRS News, Tax, Tax Daily, Tax News | Permalink

Monday, January 29, 2024

2023 Tax Filing Season Opens Today As IRS Computer Snarl Could Impact Millions Of Taxpayers

The Messenger, IRS Computer Snarl Could Threaten Millions of Taxpayers as Filing Season Is About to Open:

IRS Logo (2023)A computer snarl has hit the Internal Revenue Service just as the filing season is set to open, with the agency saying Friday that some payroll providers, banks, mortgage companies and accountants have been unable to upload required tax documents.

The problem, a login issue with an upgraded IRS computer system, is affecting some companies that file forms used to report taxable income earned by independent contractors. It's also impacting banks issuing statements of interest income and retirement account distributions, corporations reporting dividends received by shareholders, and government agencies issuing tax refunds, the IRS said in an email midday Friday.

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January 29, 2024 in IRS News, Tax, Tax News | Permalink

Saturday, January 27, 2024

Trump’s Yuge Golf Course Conservation Easement Tax Break: $323 Million


Trump Blue Monster

Wall Street Journal, Trump’s Golf-Course Tax Break Could Reach $323 Million:

Donald Trump could claim up to $323 million in federal income-tax deductions for promising not to build on one of his golf courses in Florida, according to a federal tax form from his company.

The move to protect the Blue Monster golf course at Trump National Doral Golf Club might have helped the former president lower the tax bill on the sale of his hotel in Washington in 2022, and it provides a glimpse into the Republican presidential front-runner’s finances since he left the White House in 2021. The transaction on the 184-acre Miami-area property is by far Trump’s largest known use of the conservation-easement tax break, which has previously prompted questions from state officials and the Internal Revenue Service. It is more than 10 times bigger than his similar deals in California and New York.

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January 27, 2024 in Tax, Tax News | Permalink

Friday, January 26, 2024

Tax Policy In The Biden Administration

Thursday, January 25, 2024

Cardozo Tax Prof Appeals Decision Subjecting Him To New York Teleworker Tax On Days He Works From His Connecticut Home

Following up on my previous post, Tax Prof Must Pay New York Non-Resident Income Tax On Days He Taught Law Students On Zoom From His Connecticut Home When Cardozo Was Closed During Covid:  Law360, Professor In Connecticut Asks NY Tribunal To Nix Teleworker Tax:

ZelinskyAn administrative law judge created two undefined legal tests regarding virtual presence and temporary displacement from an office in upholding New York's tax on days a professor worked from home in Connecticut, he argued to the New York Tax Appeals Tribunal.

Edward Zelinsky, a professor at Yeshiva University's Benjamin N. Cardozo School of Law in Manhattan, argued in a brief filed Saturday that Administrative Law Judge Jessica DiFiore made a series of errors in her November determination saying he owed New York income tax on days worked remotely in 2019 and 2020.

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January 25, 2024 in Legal Ed News, Legal Education, New Cases, Tax, Tax Daily, Tax News | Permalink

Saturday, January 20, 2024

Lily Batchelder Returns To NYU After Serving Over 3 Years As Assistant Secretary For Tax Policy

NYU Law News, Lily Batchelder Returns to NYU Law After Serving as the Treasury Department’s Assistant Secretary for Tax Policy:

BatchelderLily Batchelder will return to NYU Law in Spring 2024 after serving as assistant secretary for tax policy at the US Department of the Treasury. Batchelder, who is the Robert C. Kopple Family Professor of Taxation at the Law School, was nominated to the Treasury post by President Joe Biden and confirmed by the US Senate in 2021 by a vote of 64-34.

As assistant secretary, Batchelder led Treasury’s Office of Tax Policy (OTP), which is responsible for developing and implementing the federal government’s tax policies and programs, negotiating tax treaties, and providing estimates for the president’s budget, fiscal policy decisions, and cash management decisions. In collaboration with partners across the US government, OTP also helps shape economic policy, health and retirement policy and clean energy policy. This includes implementation of landmark legislation, such as the Inflation Reduction Act of 2022, the Infrastructure Investment and Jobs Act, the CHIPS and Science Act, SECURE 2.0, the American Rescue Plan, and the Affordable Care Act. Batchelder has also overseen US negotiations in the OECD-led international tax deal, which aims to reduce corporate profit shifting between high- and low-tax jurisdictions. ...

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January 20, 2024 in IRS News, Legal Ed News, Legal Education, Tax, Tax Daily, Tax News, Tax Prof Moves | Permalink

Friday, January 19, 2024

Tax Policy In The Biden Administration

Thursday, January 18, 2024

U.S. Tax Court's Tax Trailblazers: Pam Olson

U.S. Tax Court's Diversity & Inclusion Series, Tax Trailblazers: Mentoring the Next Generation:

Pam olsonPlease join the United States Tax Court as its Tax Trailblazers series continues with Pam Olson, senior tax policy advisor at PwC, today at 7:00 - 8:15 PM EST (register here). 

Pam Olson is a senior tax policy advisor at PwC. She previously served as PwC’s U.S. Deputy Tax Leader and Washington National Tax Services Leader.

Prior to joining PwC, Ms. Olson led the Washington tax practice at Skadden, Arps, Slate, Meagher & Flom LLP, where she was a partner from 1990 to 2001 and from 2004 to 2011. From 2001 to 2004, Ms. Olson served as Deputy Assistant Secretary and the first woman Assistant Secretary for Tax Policy at the U.S. Department of the Treasury. Ms. Olson also held various positions with the IRS Office of Chief Counsel.

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January 18, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News | Permalink

Wednesday, January 17, 2024

WSJ And Gavin Newsom Spar Over Whether Wealth Tax Is Coming To California

Wall Street Journal Editorial, California’s Wealth Tax Arrives:

Progressive ideas that originate in California have a habit of spreading. So it’s worth paying attention to legislation moving in Sacramento to establish a wealth tax on high earners and a bounty-hunter scheme for plaintiff attorneys to target alleged tax dodgers.

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January 17, 2024 in Tax, Tax Daily, Tax News | Permalink

Tuesday, January 16, 2024

State Controller Asks Congress To Change Law To Block Shohei Ohtani’s Avoidance Of $100 Million California Tax By Deferring $680 Million Of His Dodgers Salary For 10 Years

Following up on my previous post, Shohei Ohtani’s Contract Could Save Him $100 Million In Taxes — And Start A Silicon Valley Tax Planning Trend:  Robert W. Wood (Forbes), California Seeks Tax Law Change For Ohtani $700 Million Baseball Contract:

OhtaniBaseball star Shohei Ohtani’s record-breaking $700 million contract with the Los Angeles Dodgers is in the news again, and this time it is all about taxes. The baseball phenom and his advisers appear to have lawfully steered clear of California taxes for most of the outsize pay deal—for now.

Ohtani reportedly deferred most of his salary under his 10-year contract with the Dodgers. It may cleverly avoid California’s 14.4% state income tax as long as he moves out before the big money starts rolling in. But California’s Controller Malia M. Cohen wants Congress to change the tax code to cap deferred payments, a change that could ensure the state gets a hefty cut.

California has been known to change the law to send tax revenues its way, sometimes even retroactively, such as the 2023 law to retroactively tax certain trusts. But a change to get a piece of deferred pay deals like Ohtani’s would have to be made to federal tax law, not just California. The California Controller asked for Congress to step in over the $700 million Dodgers player contract that awards the start pitcher-slugger just $20 million for ten years of play. The whopping $680 million payout kicks in for 2034 through 2043 to nicely escape California tax, as long as Ohtani moves out by 2034.

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January 16, 2024 in Celebrity Tax Lore, Tax, Tax Daily, Tax News | Permalink

David Gamage And Shruti Rana Leave Indiana-Bloomington For Missouri-Columbia

Gamage RanaDavid Gamage, Professor of Law and William W. Oliver Chair in Tax Law at Indiana-Bloomington, has accepted a position at Missouri-Columbia as Law School Foundation Distinguished Professor of Tax Law and Policy, effective January 2024. Before coming to Indiana-Bloomington in 2016, David was a tenured tax professor at UC-Berkeley.

Professor David Gamage is a scholar of tax law and policy and also of health law and policy. He has written extensively on tax and budget policy at both the U.S. state and federal levels, as well as on tax theory, fiscal federalism, and the intersections between taxation and health care. Professor Gamage is ranked as the 9th most-cited U.S. tax law scholar and is the youngest scholar on that top-10 list. He is also ranked as the 5th most-downloaded U.S. tax law scholar.

Shruti Rana, David's wife, left her positions at Indiana-Bloomington in September 2023 for positions at Missouri-Columbia as Assistant Vice Chancellor for Inclusive Excellence and Strategic Initiatives and Professor of Law. She will resign from her position on the Bloomington City Council effective February 7, 2024.

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January 16, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News, Tax Prof Moves | Permalink

Saturday, January 13, 2024

NY Times: National Taxpayer Advocate Laments IRS Struggles To Answer Taxpayer Phone Calls Despite Budget Infusion

New York Times, Effort to Revamp I.R.S. Faces Challenges Despite Funding Infusion:

2023 National Taxpayer AdvocateThe Office of the National Taxpayer Advocate lamented that the tax collection agency, which now faces budget cuts in Congress, is still struggling to answer the telephones.

A multibillion-dollar federal effort to modernize the Internal Revenue Service has not yet solved the agency’s struggles to answer customers’ calls, ameliorate identity theft or process amended tax returns, the agency’s watchdog wrote on Wednesday in a report to Congress.

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January 13, 2024 in IRS News, Tax, Tax Daily, Tax News | Permalink

Friday, January 12, 2024

Tax Policy In The Biden Administration

Thursday, January 11, 2024

A New Tax Loophole For The Wealthy: Shifting $35,000 From 529 College Savings Plans Into Roth IRAs

The Messenger, How College Savings Plans Became a Big, Fat Tax Loophole for the Wealthy:

Tucked into the recent federal overhaul of retirement rules lies a mini tax loophole for the wealthy and their offspring. The perk, which went into effect on Jan. 1, is embedded in a surprising place: a provision intended to help millions of Americans save for the soaring cost of educating their kids.

Starting this year, families enrolled in the popular college savings plans called 529s can shift up to $35,000 in their accounts into a Roth IRA — a type of individual retirement account whose compounded growth and withdrawals are tax-free, just like those of 529s.

But while a college savings plan can be used tax-free only for educational expenses, a Roth account can be used for anything — the down payment on a house, vacations, the acquisition of a small business. And because a Roth can be invested in a much wider array of securities than a 529, it potentially has better chances of appreciating more.

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January 11, 2024 in Tax, Tax Daily, Tax News | Permalink

Wednesday, January 10, 2024

Gregg Polsky And Patrice Wylly Join NYU As Professors Of Tax Practice

NYU Law News, Gregg Polsky and Patrice Wylly ’15, LLM ’18 to Join NYU Law’s Tax Faculty:

Polsky-wyllyGregg Polsky, the Francis Shackelford Distinguished Professor in Taxation Law at the University of Georgia School of Law, and Patrice Wylly ’15, LLM ’18, a tax specialist at the trading firm Jane Street Group, will both join the NYU Law faculty as professors of practice in the Graduate Tax Program.

Polsky, a faculty member at the University of Georgia School of Law since 2016, focuses in his teaching and writing on federal income tax and business law. He has taught basic tax, corporate tax, partnership tax, business basics for lawyers, and a tax policy seminar. Polsky co-authored the casebook Federal Income Taxation: Cases and Materials and has published articles on private equity and venture capital tax strategies, corporate transactions, and executive compensation. ...

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January 10, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News, Tax Prof Moves | Permalink

WaPo: Red States Feed At The Federal Trough, Blue States Supply The Feed

Washington Post Department of Data, Do Blue-State Taxes Really Subsidize Red-State Benefits?:

Which states contribute the most to the federal budget in taxes, and which get the most back in terms of benefits? Or, as Joseph McClane from Rockville, Md., put it: “Which states are not pulling their weight?”

On behalf of everyone wondering about this, we called the fine folks at the Rockefeller Institute of Government, a nonpartisan Albany think tank affiliated with the State University of New York. ...

Eight of the 10 states that get the most money back from the federal government per dollar they pay into the system voted for Trump in 2020. Nine of the 10 states that got the least voted for Biden. The typical red state gets back 19 cents more for each dollar sent to Washington than its blue-state friends.

WaPo 50 States

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January 10, 2024 in Tax, Tax News | Permalink

Monday, January 8, 2024

NY Times: IRS To Begin Trial Of Its Own Free Tax-Filing System

New York Times, I.R.S. to Begin Trial of Its Own Free Tax-Filing System:

IRS Logo (2023)The Internal Revenue Service is rolling out a free option for filing federal tax returns this year to some residents of a dozen states.

Last month, the agency published details of its plan to test an in-house filing system, in which taxpayers submit their federal tax returns directly to the agency online at no cost. Residents of 12 states are eligible to participate if they meet certain criteria.

“This is a critical step forward for this innovative effort that will test the feasibility of providing taxpayers a new option to file their returns for free directly with the I.R.S.,” Danny Werfel, the agency’s commissioner, said in a recent statement.

While the direct filing system is starting on a limited basis, it has already faced some resistance, particularly from commercial tax-preparation companies.

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January 8, 2024 in IRS News, Tax, Tax Daily, Tax News | Permalink

Saturday, January 6, 2024

The U.S. Tax System Is Getting Even More Progressive

Bloomberg Op-Ed:  America Spreads the Wealth — and Redistributes It, Too, by Tyler Cowen (George Mason; Google Scholar):

I have news for you: The United States is becoming more redistributionist. Whether you like it or not.

The broader historical trends show that the US tax-and-transfer system is getting more progressive, including in recent years. And the US government is increasingly redistributing wealth to the bottom half of the income distribution.

This portrait belies the common view that the US doesn’t have a “real” welfare state, at least as compared to, say, the Nordic countries. Writers from left-leaning perspectives frequently claim that the US has “gutted” its welfare programs. ...

The more accurate picture, less exciting though it may be, is that there is income redistribution in the US, either because voters think it is the right thing to do or because they hope to gain themselves from such a system. And as the US increases its wealth, it is redistributing more of it. ...

In a recent study [How Progressive is the U.S. Tax System?], Thomas Coleman and David A. Weisbach of the University of Chicago focus on research of tax-and-transfer progressivity and establish some ground rules for judging its reliability: It should measure income comprehensively; look at both taxes and transfers; examine the issue over decades; and make their data available. Under these criteria, only three studies qualify. After scrutinizing that research, Coleman and Weisbach conclude:

Methodological choices produce some differences in the size of their estimates and the size of the trends, but the central story in all these studies is the same: the dominant change in the tax and transfer system over the past half-century has been an increase in transfers to the bottom. … All three studies show that the tax and transfer system has become more progressive and more redistributive.


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January 6, 2024 in Tax, Tax News | Permalink

Friday, January 5, 2024

Tax Policy In The Biden Administration

The Top 10 Tax Posts Of 2023

Thursday, January 4, 2024

Pat Cain & Cliff Fleming Receive Inaugural AALS Tax Section Lifetime Achievement Awards

Patricia A. Cain (Santa Clara) and J. Clifton Fleming, Jr. (BYU; Google Scholar) receive the inaugural AALS Tax Section Lifetime Achievement Awards yesterday at the AALS Annual Meeting in Washington, D.C.: 

Santa Clara University School of Law

Pat CainProfessor Patricia "Pat" Cain has been selected to receive the Association of American Law Schools Tax Section Inaugural Lifetime Achievement Award!

Professor Cain received outstanding praise from the AALS Tax Section, who wrote that, "Professor Patricia Cain, Professor of Law at Santa Clara University School of Law, is awarded the 2024 AALS Tax Section Lifetime Achievement Award in recognition for her outstanding contributions to federal tax policy, feminist legal theory, and LBGTQ advocacy. Over nearly 5 decades of dedicated law teaching and scholarship, Professor Cain has been a leading light in critical tax scholarship. One of the standout achievements in Professor Cain's illustrious career is her unwavering commitment to advancing the rights of LGBTQ taxpayers within the framework of tax law. Professor Cain's dedication to this cause is evident in her extensive body of work, which includes law review articles, essays, book reviews, and amicus briefs. Professor Cain’s extensive teaching career also demonstrates her commitment to legal education..."

Dean Michael Kaufman commented on her award, "On behalf of the entire Santa Clara Law community, I want to extend our congratulations to Patricia Cain for this incredible honor, rightly recognizing her extraordinary past and ongoing achievements as a transformative scholar, teacher, public servant, and trail blazer."

Please join us in congratulating Professor Cain on receiving this incredible honor.

BYU Law News, BYU Law Tax Professor J. Clifton Fleming Awarded AALS Lifetime Achievement Award:

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January 4, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News, Tax Profs, Tax Scholarship | Permalink

Longtime Tax Watchdog J. Russell George Dies After Illness

Bloomberg, Longtime Tax Watchdog J. Russell George Dies After Illness:

GeorgeJ. Russell George, who served as a key IRS watchdog for nearly two decades, most notably during the 2013 controversy over groups’ applications for tax-exempt status—died earlier this week after a lengthy illness.

George had served as the Treasury Inspector General for Tax Administration since 2004, after being nominated by then-President George W. Bush and confirmed by the Senate. His death was announced Wednesday by Acting Inspector General Heather Hill. ...

In May 2013, George’s office released what became a bombshell report finding that the IRS had subjected conservative groups’ applications for tax-exempt status to extra scrutiny and delays, triggering a political firestorm for the agency and the Obama administration. Democrats criticized George at the time for leaving out the fact that liberal groups also faced extra IRS scrutiny. George said he didn’t know about the scrutiny of progressive groups until after the initial report was released. ...

He grew up in New York City and earned his bachelor’s degree from Howard University and his law degree from Harvard University.

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January 4, 2024 in IRS News, Tax, Tax Daily, Tax News | Permalink

Tuesday, January 2, 2024

Tax Notes Federal 2023 Persons Of The Year: Kathleen And Charles Moore

Marie Sapirie, Persons of the Year: The Moores: The Constitution, Realization, and Two Tax Everymen, 181 Tax Notes Fed. 2091 (Dec. 18, 2023):

Tax Notes Federal (2022)Every tax practitioner and many readers of editorial pages will recognize their names today, but that wasn’t true until recently. For their role as petitioners in the most highly analyzed and anticipated Supreme Court tax case of the year, Kathleen and Charles Moore are the Tax Notes Federal People of the Year. ...

The Moores are among the few Tax Notes Federal People of the Year in recent years who aren’t tax professionals or elected officials. They’re Everyman taxpayers who have taken the stage — by their admission, reluctantly — in the increasingly worldwide drama of modern tax law. Kathleen recounted in the video her memory of receiving the IRS’s deficiency letter, an experience shared by many taxpayers each year: “Well, it’s never good to get something in the mail from the IRS. It makes your heart pound.” And then she admitted that she wasn’t sure she wanted to be a litigant against the IRS. Certainly, very few would relish that role. ...

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January 2, 2024 in Tax, Tax Analysts, Tax Daily, Tax News | Permalink

Tax Prof Victoria Haneman Participates In New Fox Game Show Tonight: The Floor

Omaha World Herald, Creighton Law Professor to Appear on New Fox Game Show:

Haneman (2024)Earlier this year, Victoria Haneman got on a plane and flew to Ireland to participate in a game show.

The Creighton University law professor knew it was a game show. Beyond that, the details were a mystery.

At 9 p.m. the night before filming started, Haneman learned the show was called “The Floor,” hosted by actor Rob Lowe. It will air on Fox starting Jan. 2 at 8 p.m.

“’The Floor’ is a spectacular battle of the brains in which 81 contestants stand on 81 squares on a massive game show floor, competing for a $250,000 grand prize,” Fox said in a press release.

In the show, the contestants have their own topic of expertise like hip-hop, rock stars, slogans, dogs or popular books. Contestants face someone from another square in a quiz duel. The winner of the duel advances, and the loser leaves the game.

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January 2, 2024 in Legal Ed News, Legal Education, Tax, Tax Daily, Tax News, Tax Profs | Permalink

Monday, January 1, 2024

Why Cutting IRS Funding Is Not Conservative

Washington Post Op-Ed:  Why Cutting IRS Funding Is Not a Conservative Move, by Brian Riedl (Manhattan Institute):

IRS Logo (2023)Last year, President Biden and congressional Democrats enacted $80 billion in new IRS funding for the next decade. During the debt limit debate earlier this year, Republicans successfully negotiated a $20 billion cut in that funding. And now, in the appropriations showdown, they’re going after the rest of it.

The IRS has long been an easy and popular target, because few of us enjoy paying taxes. And the agency has invited criticism with its history of overzealous audits, including a heavy-handed targeting of conservative nonprofit organizations during the Obama administration that fueled the latest round of GOP cuts.

However, defunding and weakening the IRS is not conservative. To the contrary, it will ultimately drive up deficits and raise middle-class taxes.

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January 1, 2024 in Congressional News, IRS News, Tax, Tax Daily, Tax News | Permalink

Cato Institute: 2026 Tax Increases In One Chart

Cato Institute, 2026 Tax Increases in One Chart:

In 2017, Republicans cut and reformed taxes for individuals and businesses. The vast majority of the changes for individuals expire at the end of 2025, which will increase taxes in 2026 by about $400 billion a year. There is broad bipartisan support to extend about three‐​quarters of the tax cuts.

The following table provides a summary of current policy, the tax changes that will take effect automatically in 2026, and an abbreviated recommendation for how to address the changes. ...

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January 1, 2024 in Tax, Tax News, Think Tank Reports | Permalink

Saturday, December 30, 2023

Former IRS Commissioner John Koskinen's Use Of Charitable Lead Annuity Trust Elevated Duke Athletics, Provided Early Inheritance To His Children, And Allowed Him To Take Public Interest Posts Late In His Career

Fortune, How a Former IRS Boss Optimizes His Charitable Trust to Support His Alma Mater–and Give Assets to His Children Tax-Free:

John Koskinen’s phone has been ringing a lot these days. The 84-year-old former IRS Commissioner known as “Mr. Fix-It” may be retired, but he sits on the board of three non-profit organizations, is an advisor to two startups, plays tennis several times a week, remains an avid theatergoer, enjoys time with his family, and still prioritizes interviews about everything from IRS controversy to charitable trust strategy innovations. Koskinen’s humility (“I’m not sure anyone else wanted the job,” he says of his four-year post at the IRS under President Obama) belies an extraordinary professional trajectory and ongoing influence in both public and private sectors. With a career spanning federal judge clerkship, law practice, political campaign management, turning around failing enterprises, and political appointments by Presidents Clinton, Bush, and Obama, Mr. Fix-It’s clear-sightedness has a far-reaching impact. Yet of all these accomplishments, it’s the endowment he set up for his alma mater, Duke University, using a charity lead annuity trust (CLAT) that’s offered the most enduring fulfillment.

After graduating from Duke with a degree in Physics in 1961, Koskinen set out to Yale School of Law. ...  Thirty-seven years later—inspired by his years at Duke, keen human interest, and desire to preserve his children’s inheritance—Koskinen set up a charity lead annuity trust to benefit the university. While endowment programs have long sought out generous contributions from donors, Koskinen was ahead of his time in using a CLAT to provide exponential yearly benefits to both donor and institution. Koskinen’s CLAT used the appreciation from his invested stocks to fund athletic scholarships and to build a 4,500-seat, state-of-the-art lacrosse and soccer stadium (that now carries his name) at Duke. These projects helped elevate the university’s sports program to national prominence.

Koskinen Stadium Duke 2

Koskinen’s leadership demonstrated the CLAT’s power as one of the most robust estate planning tools available for both philanthropy and generational wealth creation.

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December 30, 2023 in Tax, Tax Daily, Tax News | Permalink

Friday, December 29, 2023

Seven Tax Experts: The Biggest Implications Of Moore

The Biggest Implications of Moore, 181 Tax Notes Fed. 2147 (Dec. 18, 2023):

Supreme Court (Current)In this installment of the Star Forum, experts answer the following question: What do you see as the biggest implications of Moore, even though we don’t know for sure how the Supreme Court will decide the case? (The authors drafted their initial essays — and reached their conclusions — without seeing each other’s contributions.)

Conor Clarke (Washington University; Google Scholar), We Are All Tax Historians Now, 181 Tax Notes Fed. 2147 (Dec. 18, 2023):

The opposing parties in Moore obviously don’t agree on much, but on one point they see eye to eye: History can help determine the constitutionality of a tax law.

Patrick Driessen (former government economist and revenue estimator), Tax Mandates, Leverage, and Whipsaws, 181 Tax Notes Fed. 2149 (Dec. 18, 2023):

The traction of the Moores’ challenge to the TCJA’s taxation of pre-2018 deferred foreign earnings has been surprising, even if it is “just” a scarecrow to ward off accrual and wealth taxes (that, too, would seem to me a bad outcome). Also, the TCJA’s MRT itself was surprising seven years ago. Either I surprise easily, or tax policy has become more suspenseful.

Michael J. Graetz (Columbia), What I Learned at the Oral Argument in Moore, 181 Tax Notes Fed. 2151 (Dec. 18, 2023):

In The Power to Destroy: How the Antitax Movement Hijacked America, my new book, I describe how, during this last half-century, reducing taxes at the top and curbing the government’s ability to raise the revenues necessary to fund government spending became the linchpin holding together disparate elements of the Republican coalition. The antitax movement, I claim, is “the most overlooked social and political movement in recent American history.” Activist members of that movement have now enlisted the Supreme Court — by attacking as unconstitutional an obscure international tax provision, enacted as a crucial element of a Republican tax law — to block their real target: Democratic proposals to increase taxes on the rich. Leaving the oral argument, I marveled at the skill with which the movement successfully recruited a Supreme Court majority of longtime Republican conservatives into their project of limiting taxes on wealthy Americans.

Daniel J. Hemel (NYU: Google Scholar), Winning by Losing, 181 Tax Notes Fed. 2153 (Dec. 18, 2023):

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December 29, 2023 in Tax, Tax Analysts, Tax Daily, Tax News | Permalink

Tax Policy In The Biden Administration

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December 29, 2023 in Tax, Tax Daily, Tax News, Tax Policy in the Biden Administration | Permalink

Wednesday, December 27, 2023

NY Times Op-Ed: The Transformation Of Global Income Inequality

New York Times Op-Ed: Income Inequality Has Been Transformed Globally, by David Wallace-Wells:

Athletes, like entertainers, have always been complicated case studies in American oligarchy. They are both entrepreneurs and labor, wealthy and yet often exploited, and have operated for 50 years in an endless boom cycle for the business of sports. But as avatars of the superstar-economy era, athletes — like the entertainers Taylor Swift and Beyoncé, whose tours this year have apparently had a notable effect on national G.D.P. — play an outsize role in illustrating the country’s inescapable economic morality tale: While an awful lot has changed about America and the world since 1974, it sometimes seems that the biggest and most important change is the social fact of exploding income inequality.

In the aftermath of the financial crisis, the country was given a crash course, first by the Tea Party and Occupy Wall Street, then by Thomas Piketty and his book “Capital in the 21st Century.” We learned about the Gini coefficient, which measures the relative inequality of a society, and we learned that, in recent decades, it had grown considerably. We learned that the ratio of chief-executive pay to worker pay grew to 200-to-1 today from 60-to-1 in 1989 and from 20-to-1 in 1965. And we watched the rise of Bernie Sanders and the presidency of Donald Trump — who in accepting the Republican nomination directed his gaze at those left behind by financialization and globalization and announced, “I am your voice” — and interpreted them alongside Brexit and Boris Johnson and Jair Bolsonaro as facets of a hodgepodge international backlash to the neoliberal era and the inequalities it produced.

Culturally, the age of inequality is still churning: Over just the last six months, we’ve had the song “Rich Men North of Richmond” and Shawn Fain’s leading the United Auto Workers into a triumphant labor war with Detroit’s Big Three while wearing an “Eat the Rich” T-shirt. But at the structural level, our picture of American inequality also seems to be changing. According to some measures, U.S. income inequality hasn’t meaningfully grown over the last decade, the very period in which it has become such a potent cultural and political meme. And in the last few weeks, several high-profile critiques of Piketty’s narrative-setting work have been published, both in academic journals and in outlets like Bloomberg and The Financial Times — with mostly right-of-center commentators suggesting that the story of ballooning inequality, and of our return to the robber barons of the Gilded Age, was all methodological illusion and that inequality hadn’t actually been growing at all.

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December 27, 2023 in Tax, Tax News | Permalink

Tuesday, December 26, 2023

Milton Friedman Was Right: Tax Universities

Wall Street Journal Op-Ed:  Harvard Should Pay Its Fair Share, by Richard Vedder (Ohio University):

What can we do about the corruption of American higher education? Milton Friedman had an idea 20 years ago: Tax the schools rather than subsidize them. That reflected a change of heart. In “Capitalism and Freedom” (1960), he argued that college education had enough “positive externalities” to justify subsidies. But when I was researching a book in 2003, I emailed him (then 91) and asked if he still believed that.

He replied: “I have not changed my view that higher education has some positive externality, but I have become much more aware that it also has negative externalities. I am much more dubious than I was . . . that there is any justification at all for government subsidy of higher education. The spread of PC”—political correctness—“would seem to be a very strong negative externality, and certainly the 1960s student demonstrations were negative externalities. . . . A full analysis along those lines might lead you to conclude that higher education should be taxed to offset its negative externalities.”

The past 20 years have seen negative externalities multiply: discriminatory hiring, promotion and contracting; the exclusion of conservative scholars; the suppression of speech. The case for taxing universities is stronger than ever. ...

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December 26, 2023 in Tax, Tax Daily, Tax News | Permalink

TaxProf Blog Christmas Weekend Roundup