Paul L. Caron
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Sunday, March 28, 2021

The Top Five New Tax Papers

There is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new paper debuting on the list at #5. The #1 paper is #250 among 15,852 tax papers in all-time downloads:

  1. SSRN Logo (2018) [1,358 Downloads]  The Impact of Public Perceptions on General Consumption Taxes, by Rita de la Feria (University of Leeds; Google Scholar) & Michael Walpole (University of New South Wales; Google Scholar)
  2. [534 Downloads]  Tax Complexity and Transfer Pricing Blueprints, Guidelines, and Manuals, by Jean-Edouard Colliard (HEC Paris; Google Scholar), Lorraine Eden (Texas A&M; Google Scholar) & Co-Pierre Georg (University of Cape Town; Google Scholar)
  3. [324 Downloads]  Inter-Nation Equity Revisited, by Ivan Ozai (McGill; Google Scholar) (reviewed by David Elkins (Netanya) here)
  4. [288 Downloads]  A Wealth of Sovereign Choices: Tax Implications of McGirt v. Oklahoma and the Promise of Tribal Economic Development, by Stacy Leeds (Arizona State; Google Scholar) & Lonnie Beard (Arkansas)
  5. [227 Downloads]  Coca-Cola: A Decisive IRS Transfer Pricing Victory, At Last, by Reuven Avi-Yonah (Michigan; Google Scholar) & Gianluca Mazzoni (S.J.D. (International Tax) 2020, Michigan)

March 28, 2021 in Scholarship, Tax, Tax Scholarship, Top 5 Downloads | Permalink

Saturday, March 27, 2021

This Week's Ten Most Popular TaxProf Blog Posts

2021 Boston College-Tulane Tax Roundtable

The 2021 Boston College-Tulane Tax Roundtable took place virtually yesterday:

BC Tulane (2021)Brian Galle (Georgetown) & Stephen Shay (Boston College), Administrative Law and the Crisis of Tax Administration
Discussant: Reuven Avi-Yonah (Michigan)

Susie Morse (Texas), Emergency Money: Lessons from the Paycheck Protection Program
Discussant: Andrew Hayashi (Virginia)

Shu-Yi Oei (Boston College) Who Joins BEPS? Understanding the Proliferation of International Tax Consensus
Discussant: Steve Shay (Boston College)

Steve Sheffrin (Tulane) & Koray Caglayan (American Institutes for Research), Giver and Taker States over the Business Cycle
Discussant: David Walker (Boston University)

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March 27, 2021 in Conferences, Scholarship, Tax, Tax Conferences, Tax Scholarship | Permalink

Dorothy Brown On Morning Joe: How The Tax System Impoverishes Black Americans

Dorothy Brown (Emory) appeared on Morning Joe yesterday in a segment on How the Tax System Impoverishes Black Americans and How To Fix It. Dorothy discussed her new book, The Whiteness of Wealth: How the Tax System Impoverishes Black Americans — And How We Can Fix It (2021)).

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March 27, 2021 in Legal Education, Tax | Permalink

Friday, March 26, 2021

Weekly SSRN Tax Article Review And Roundup: Speck Reviews Cauble's Questions The IRS Will Not Answer

This week, Sloan Speck (Colorado; Google Scholar) reviews a new work by Emily Cauble (DePaul), Questions the IRS Will Not Answer, 97 Ind. L.J. ___ (2021).

Speck (2017)

In Questions the IRS Will Not Answer, Emily Cauble provides an important analysis and critique of the Internal Revenue Service’s “no-rule” areas—topics on which the IRS will not, or ordinarily will not, issue private letter rulings. Cauble focuses on fact-intensive issues that fall into this prohibited space. Her motivating examples involve the classification of gifts under the Duberstein standard, the boundary between nondeductible personal outlays and deductible medical expenses under § 213, and intent-oriented aspects of the related party antiabuse rule for like-kind exchanges under § 1031(f). Fundamentally, however, Cauble’s approach is normative: she searches for, then evaluates, potential rationales for administrative reticence in giving private guidance in situations where the facts are likely determinative.

Cauble presents—then largely rejects—eight reasons that might justify an administrative refusal to rule on fact-sensitive issues.

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March 26, 2021 in Scholarship, Sloan Speck, Tax, Tax Scholarship, Weekly SSRN Roundup, Weekly Tax Roundup | Permalink

Tax Policy In The Biden Administration

Next Week's Virtual Tax Workshops

Monday, March 29: Roberta Mann (Oregon) will present Targeting Plastics Pollution with Taxes virtually at Boston College as part of its Tax Policy Workshop Series. If you would like to attend, please contact Jim Repetti.

Monday, March 29: Heather Field (UC-Hastings; Google Scholar) will present Itemization After The TCJA: How State Election Uniformity Laws Undermined Tax Simplification virtually at Florida as part of its Tax Colloquium Series. If you would like to attend, please contact Charlene Luke.

Tuesday, March 30: Andy Grewal (Iowa) will present Tax 202: Properly Allocating Deductions to Tax-Exempt Income virtually at Florida State as part of its Tax Workshop Speaker Series. If you would like to attend, please contact Jeffrey Kahn.

Thursday, April 1: Brian Galle (Georgetown; Google Scholar) & Stephen Shay (Boston College; Google Scholar) will present Admin Law and the Crisis of Tax Administration virtually at Indiana as part of its Tax Policy Colloquium Series. If you would like to attend, please contact Leandra Lederman.

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March 26, 2021 in Colloquia, Legal Education, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Hickman Presents OIRA Review Of Tax Regulatory Activities  Virtually Today At Duke

Kristin Hickman (Minnesota; Google Scholar) presents OIRA Review of Tax Regulatory Activities virtually at Duke today as part of its Tax Policy Workshop Series hosted by Richard Schmalbeck & Lawrence Zelenak:

Kristin-hickman-webIn April 2018, the Treasury Department and the Office of Information and Regulatory Affairs (OIRA) signed a Memorandum of Agreement reversing an exemption and providing for the first time that significant tax regulatory actions would be subject to OIRA review under Executive Order 12866. The transition to the Biden administration has raised questions whether the Memorandum of Agreement should be reversed and most tax rules and regulations again exempted from OIRA review. Critiques of OIRA review in the tax context generally focus on disagreements over whether the benefit-cost analysis required by Executive Order 12866 is useful or should rely on different methodological assumptions. This essay emphasizes instead the symbiotic relationship between OIRA review, benefit-cost analysis, and compliance with Administrative Procedure Act procedure and process requirements. 

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March 26, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Li Presents Creating A Global Tax Regime With The OECD Pillar One Blueprint  Virtually Today At British Columbia

Jinyan Li (Osgoode Hall) presents Legal Challenges in Creating a Global Tax Regime with OECD Pillar One Blueprint virtually at British Columbia today as part of its Tax Law and Policy Workshop Speaker Series hosted by Wei Cui:

6a00d8341c4eab53ef026bdec1f1d4200c-300wi (2)Like the Internet connecting the computers of the world, a global tax regime created with the OECD Pillar One Blueprint seeks to integrate and standardize national corporate taxes in respect of automated digital services and consumer facing businesses of large corporations. In this article, the author considers the various legal challenges of creating such a regime.

Conclusion
The Pillar One Blueprint offers tremendous insights on the political aspirations and technical innovations of those involved. In this article, the author seeks to contribute to the debates about Pillar One by highlighting some general legal challenges that are animated from underlying political, fiscal and economic concerns at a national level. Since Pillar One requires a legal basis for implementation because the Inclusive Framework has no legal authority to address tax base creation or allocation matters, legal obstacles at national levels will likely determine the fate of reaching a global consensus.

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March 26, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Mississippi Seeks To Hire A Tax Visitor

University of Mississippi Seeks Visiting Professor in Taxation:

Mississippi (2021)The University of Mississippi School of Law invites applications and nominations for a visiting professor during the 2021-2022 academic year.  Depending on the courses that are being taught, we are flexible as to one semester (fall or spring) or full academic-year visitorships. Appointments will be at the rank of assistant, associate, or full professor depending on experience.

We are looking for a candidate to teach Income Tax and an advanced tax course, plus two other courses (2 courses per semester). Our expectation for teaching next year is in-person, although the public health situation may require occasional remote and hybrid teaching.

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March 26, 2021 in Legal Education, Tax, Tax Prof Jobs | Permalink

Houston Hosts Energy Tax Conference Today

Houston (2017)The University of Houston Law Center hosts the 3rd Annual Denney L. Wright International Energy Tax Conference and the Houston Business and Tax Law Journal 21th Annual Symposium today on Exploring International Energy Investments During/Post Pandemic virtually today from 9:00 AM – 3:00 PM CDT:

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March 26, 2021 in Conferences, Scholarship, Tax, Tax Conferences | Permalink

Thursday, March 25, 2021

Ordower: New York’s Proposed Mark-To-Market Tax Decouples From Federal Tax

Following up on my previous post, New York's Proposed Mark-to-Market Wealth Tax Would Raise $23 Billion From <200 Billionaires:  Henry Ordower (Saint Louis), New York’s Proposed Mark-to-Market Tax Decouples From Federal Tax, 170 Tax Notes Fed. 1243 (Feb. 22, 2021):

Tax Notes Federal (2020)In this article, Ordower examines proposed legislation in New York that would tax the unrealized gain and other deferred income of billionaires in the state, and the complexities that the legislation’s enactment is likely to generate. ...

This article addresses the structure of state income taxes and credits for taxes paid by residents to other states and the confusion that nonuniform decoupling generates across state borders. Separation from federal rules may help to stanch the loss of state revenue from federal tax amendments and enhance state tax revenue — especially revenue that the state otherwise might never capture but to which it may have a claim.

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March 25, 2021 in Scholarship, Tax, Tax Analysts, Tax Scholarship | Permalink

Avi-Yonah: The Taxpayer Bill Of Rights — Reflections On A Toddler

Reuven S. Avi-Yonah (Michigan), The US Taxpayer Bill of Rights: Reflections on a Toddler:

In the US the Taxpayer Bill of Rights (TBOR) is only seven years old, and moreover no successful challenge to the IRS under it has been brought so far. The following first describes the existing case law under the US TBOR. The main conclusion is that the US TBOR is a toddler with uncertain prospects.

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March 25, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

The Nuanced Impact Of The State And Local Tax Deduction Cap On Pass-Through Business

Jeffrey H. Kahn (Florida State), Miles A. Romney (Florida State) & John Treu (West Virginia), Too Much SALT? The Nuanced Impact of the State and Local Tax Deduction Cap on Pass-Through Business Taxpayers, 25 Fla. Tax Rev. __ (2021):

Florida Tax Review (2019)Perhaps the most controversial provision of the Tax Cuts and Jobs Act of 2017 is the state and local tax deduction limitation (or SALT cap), particularly with respect to how the cap impacts pass-through entities in high-tax states. This particular provision of the tax law has been criticized by opponents as deliberately punitive to small businesses in blue states, while proponents maintain that eliminating the SALT cap would primarily benefit high income taxpayers. Politicians from blue states have called for the repeal of the SALT cap and some states have enacted various work-arounds with questionable prospects of success. Still, many taxpayers will not benefit from a SALT deduction irrespective of the SALT cap, particularly taxpayers that either take the standard deduction or are subject to the alternative minimum tax (AMT). We examine the developing law around the SALT cap and provide descriptive empirical evidence of its disparate impact on closely held business taxpayers.

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March 25, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Wednesday, March 24, 2021

Tahk Presents Spillover Tax Precedent Virtually At Cornell

Susannah Camic Tahk (Wisconsin; Google Scholar) presented Spillover Tax Precedent virtually last Friday at Cornell as part of its Faculty Workshop Series:

SusannahtahkWe know that pro se litigants often lose. However, we know almost nothing about the circumstances in which they win. One such circumstance, this Article finds, is when they can take advantage of favorable precedent. This Article calls those favorable precedents for pro se litigants “spillover precedents.” Spillover precedents are cases with redistributive downward ripple effects that subsequently benefit pro se litigants. This Article is the first to examine the potential redistributive effects of precedent. To focus the inquiry, the Article carried out an empirical study of Tax Court cases from 2015-2019 in which pro se litigants won. This analysis revealed the major role of spillover precedent. The Article details how pro se taxpayers use spillover precedent, describing major examples and identifying patterns in them. 

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March 24, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Cauble: Questions The IRS Will Not Answer

Emily Cauble (DePaul), Questions the IRS Will Not Answer, 97 Ind. L.J. ___ (2021):

When a taxpayer plans to undertake a transaction and its tax consequences are unclear, the taxpayer can request a letter ruling from the IRS. The IRS issues numerous letter rulings each year. In 2020, for instance, the IRS issued 777 letter rulings. The IRS refrains from issuing letter rulings on certain topics. At the beginning of each year, the IRS publishes an updated list of the topics on which it will not rule. Many of the topics on which it will not rule arise in areas of tax law governed by standards where the tax outcome depends heavily on each transaction’s specific facts. This pattern is consistent with the IRS’s stated position that it ordinarily does not rule in certain areas because of the factual nature of the matter involved.

This Article suggests that a policy against ruling on fact-specific topics sacrifices an opportunity to rule on many of the very topics for which a letter ruling could be particularly useful. Because the fact-specific nature of a topic makes it ill-suited for generally applicable guidance, such a topic is a particularly good candidate for a letter ruling.

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March 24, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

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 March 1, 2021) 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)  198,030 Reuven Avi-Yonah (Michigan) 8,214
2 Dan Shaviro (NYU) 122,383 D. Dharmapala (Chicago) 5,369
3 Lily Batchelder (NYU) 119,893 Ruth Mason (Virginia) 4,944
4 Daniel Hemel (Chicago) 118,706 Lily Batchelder (NYU) 3,942
5 David Gamage (Indiana-Bloom.) 118,354 Bridget Crawford (Pace) 3,895
6 Darien Shanske (UC-Davis) 111,563 Diane Ring (Boston College) 3,574
7 David Kamin (NYU) 107,922 Daniel Hemel (Chicago) 3,571
8 Cliff Fleming (BYU)    105,744 Shu-Yi Oei (Boston College)  3,441
9 Manoj Viswanathan (UC-Hastings) 102,664 Kim Clausing (UCLA)     3,412
10 Rebecca Kysar (Fordham) 101,711 David Kamin (NYU) 3,407
11 Ari Glogower (Ohio State) 100,526 Hugh Ault (Boston College) 2,994
12 Michael Simkovic (USC) 45,080 Margaret Ryznar (Indiana-Indy)   2,943
13 D. Dharmapala (Chicago) 43,658 Richard Ainsworth (Boston Univ.) 2,601
14 Paul Caron (Pepperdine) 38,032 Dan Shaviro (NYU) 2,208
15 Louis Kaplow (Harvard) 34,660 David Gamage (Indiana-Bloom.) 2,155
16 Richard Ainsworth (Boston Univ.) 31,828 Robert Sitkoff (Harvard) 2,144
17 Ed Kleinbard (USC) 27,521 Darien Shanske (UC-Davis)  2,001
18 Bridget Crawford (Pace) 26,783 Brad Borden (Brooklyn) 1,841
19 Vic Fleischer (UC-Irvine) 26,782 Louis Kaplow (Harvard) 1,831
20 Robert Sitkoff (Harvard) 25,931 Yariv Brauner (Florida) 1,699
21 Brad Borden (Brooklyn) 25,909 Paul Caron (Pepperdine)   1,557
22 Jim Hines (Michigan) 25,698 Cliff Fleming (BYU) 1,350
23 Ted Seto (Loyola-L.A.) 24,917 Katie Pratt (Loyola-L.A.) 1,273
24 Richard Kaplan (Illinois) 24,353 Michael Simkovic (USC) 1,232
25 Gladriel Shobe (BYU) 24,290 Ari Glogower (Ohio State) 1,194

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March 24, 2021 in Scholarship, Tax, Tax Prof Rankings, Tax Scholarship | Permalink

Utz: How Insurance Recoveries Are Taxed Under The IRC

Stephen Utz (Connecticut), How Insurance Recoveries are Taxed under the IRC, 98 Tax Notes State 607 (Nov. 9, 2020):

Tax Notes StateJeffrey H. Kahn, the Harry W. Walborsky Professor of Law at the Florida State University College of Law, has criticized my account of the tax treatment of insurance coverage in an article I published with Sachin S. Pandya concerning the tax treatment of litigation expenses. Sachin S. Pandya (Connecticut) & Stephen Utz (Connecticut), Designing the Tax Treatment of Litigation-Related Costs, 21 Fla. Tax Rev. 533 (2018). Kahn argues that the article was wrong to assert that the insurance payment of a claim against the insured “is not excludable [from gross income] unless the expense involved would have been deductible if paid by the insured and not reimbursed.” Jeffrey H. Kahn (Florida State), The Tax Treatment of Liability Insurance Coverage, 163 Tax Notes 1381, 1381 (May 27, 2019). ... This article defends the premise that the exclusion of insurance proceeds from the income of the insured depends on the deductibility by the insured of the covered obligation. ...

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March 24, 2021 in Scholarship, Tax, Tax Analysts | Permalink

Tuesday, March 23, 2021

Kim Presents Taxing Teleworkers Virtually Today At Florida State

Young Ran (Christine) Kim (Utah; Google Scholar) presents Taxing Teleworkers virtually at Florida State today as part of its Tax Workshop Speaker Series hosted by Jeffrey Kahn: 

Image (1)Since COVID-19 has forced many governments to restrict travel and impose quarantine requirements, telework has become a way of life. The shift towards teleworking is raising tax concerns for workers who work for employers located in another state than where they live. Most source states where these employers are located could not have taxed income of out-of-state teleworkers under the pre-pandemic tax rules. However, several source states have unilaterally and virtually extended their source taxation nexus on these teleworkers, resulting in unwarranted double taxation—once by the residence state and again by the source state. At this time, there is no uniform guideline by state or federal governments.

Recently, New Hampshire asked the U.S. Supreme Court to exercise its original jurisdiction challenging Massachusetts’ telecommuting taxes of nonresident teleworkers. Tax scholars believe this case will be one of the most significant tax decisions in recent years. New Jersey also opposes New York’s long-standing telecommuting taxes under the “convenience of the employer” rule. This Article examines the constitutional challenges of maintaining pre-pandemic work arrangements for tax purposes, arguing that a source state’s extraterritorial assertion to tax nonresident teleworkers’ income likely violates the Dormant Commerce and Due Process Clauses.

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March 23, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Brown: How The U.S. Tax Code Privileges White Families

The Atlantic:  How the U.S. Tax Code Privileges White Families, by Dorothy Brown (Emory; Author, The Whiteness of Wealth: How the Tax System Impoverishes Black Americans — And How We Can Fix It (2021)):

Whiteness of WealthTax policies have preserved the racial inequality that has long defined America.

Soon after I got my master’s degree in tax law from NYU in 1984, I started preparing my parents’ tax returns. They filed jointly, and what always stuck out to me was how comparable their incomes were. My mother worked as a nurse at an assisted-living facility, and my father was a plumber with the New York City Housing Authority. Some years, my father’s overtime would put him on top by a few hundred dollars; other years, my mother outearned him.

What I saw every year was what researchers call the “marriage penalty”: My parents, like many other married Black couples trying to pay for a mortgage, save for their children’s future, and afford health care, were paying higher taxes under the joint return than they would have had they remained single and filed separately. What I sensed then—and what 25 years of academic research have revealed to me in greater detail since—was that changes to the U.S. tax code typically benefit white taxpayers, while putting Black taxpayers at a further disadvantage, even when Black and white Americans have made the same life choices. Subsidies for homeownership benefit white homeowners more than Black homeowners. Tax breaks for workers benefit white workers more than Black workers. And tax reform has always been a fight over which white Americans get tax cuts, with Black Americans paying the price, as I document in my book, The Whiteness of Wealth: How the Tax System Impoverishes Black Americans — And How We Can Fix It (2021).

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March 23, 2021 in Book Club, Scholarship, Tax, Tax Scholarship | Permalink

Tax Law Review Publishes New Issue

The Tax Law Review has published a new issue (Vol. 73, No. 1 (Fall 2019)):

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March 23, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Tax Evasion At The Top Of The Income Distribution: Theory And Evidence

John Guyton (IRS), Patrick Langetieg (IRS), Daniel Reck (London School of Economics), Max Risch (Carnegie Mellon) & Gabriel Zucman (UC-Berkeley), Tax Evasion at the Top of the Income Distribution: Theory and Evidence:

This paper studies tax evasion at the top of the U.S. income distribution using IRS micro-data from (i) random audits, (ii) targeted enforcement activities, and (iii) operational audits. Drawing on this unique combination of data, we demonstrate empirically that random audits underestimate tax evasion at the top of the income distribution. Specifically, random audits do not capture most tax evasion through offshore accounts and pass-through businesses, both of which are quantitatively important at the top. We provide a theoretical explanation for this phenomenon, and we construct new estimates of the size and distribution of tax noncompliance in the United States. In our model, individuals can adopt a technology that would better conceal evasion at some fixed cost. Risk preferences and relatively high audit rates at the top drive the adoption of such sophisticated evasion technologies by high-income individuals. Consequently, random audits, which do not detect most sophisticated evasion, underestimate top tax evasion. After correcting for this bias, we find that unreported income as a fraction of true income rises from 7% in the bottom 50% to more than 20% in the top 1%, of which 6 percentage points correspond to undetected sophisticated evasion. Accounting for tax evasion increases the top 1% fiscal income share significantly.

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March 23, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Monday, March 22, 2021

Zolt: A U.S. Perspective On Cross-Border Philanthropy

Eric M. Zolt (UCLA), Cross-Border Philanthropy: A U.S. Perspective:

Americans lead the world in supporting charitable activities (both in the U.S. and abroad). For foreign charitable activities, two key questions arise:

  1. Should tax benefits support charitable activities outside the U.S.?
  2. Should the U.S. tax system treat contributions to foreign charities differently from contributions to domestic charities?

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March 22, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Brown: Your Home’s Value Is Based on Racism

New York Times op-ed:  Your Home’s Value Is Based on Racism, by Dorothy Brown (Emory; Author, The Whiteness of Wealth: How the Tax System Impoverishes Black Americans — And How We Can Fix It (2021)):

Whiteness of WealthWherever they choose to buy, Black people are penalized by white preferences. ...

Black Americans are often unable to build wealth from homeownership in the same way their white peers are, in large part because home prices are generally set by the people who make up the majority of buyers: white Americans. White families typically prefer to live in predominantly white neighborhoods with very few or no Black neighbors. Homes in these neighborhoods tend to have the highest market values because most prospective purchasers — who happen to be white — find them most desirable.

Black Americans, on the other hand, tend to prefer to live in racially diverse or all-Black neighborhoods. Research has shown that once more than 10 percent of your neighbors are Black, the value of your home declines. As the percentage of Black neighbors increases, the property’s value plummets even further. ...

Enter tax policy to add insult to injury. The typical white family has eight times the wealth of the typical Black family, a racial wealth gap that’s fueled by tax subsidies for homeownership. ...

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March 22, 2021 in Book Club, Legal Education, Tax | Permalink

Lesson From The Tax Court: S Corp Payments To Sole Shareholder Were Wages

I think of corporations as a type of vessel that sails the seas of commerce.  Like real ships, corporations are commanded by officers.  All crew, including officers, are compensated for their services.  At the end of the commercial voyage, however, an end marked either by time or transaction, profits earned are distributed to the owners of the ship.  When the officers are also the owners it becomes difficult to distinguish payments that represent wages for their services in commanding the ship from payments that represent distribution of profits.  Yet for both employment and income tax reasons, such distinction must be made.

In Lateesa Ward and Ward & Ward Company v. Commissioner, T.C. Memo. 2021-32 (Mar. 15, 2021) (Judge Holmes), we learn why payments from the taxpayer’s S corporation to the taxpayer were wages and not distributions of profit.  The case teaches a basic employment tax lesson for S Corps and a basic income tax lesson for sole shareholders.  Details below the fold.

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March 22, 2021 in Bryan Camp, New Cases, Scholarship, Tax, Tax Practice And Procedure, Tax Scholarship | Permalink | Comments (6)

TaxProf Blog Weekend Roundup

Sunday, March 21, 2021

Lord: Religious Legitimacy

Phil Lord (McGill; Google Scholar), Religious Legitimacy, 90 UMKC L. Rev. ___ (2021):

This article seeks to demonstrate both the importance of expertise and scholarship in framing a religion’s claim of legitimacy in law, and how expertise can be harnessed by a religious group to gain this legitimacy. From a broad overview of the consequences of religious status, the article analyses the tests used to attribute the status, to show the crucial role that they afford to experts and scholarship. It then argues that new religious movements, and Scientology, are ideal case studies to illustrate the importance of scholars and scholarship. Scientology is indeed the only major religion to have emerged in the twentieth century and is unique in that it has, over this period, gained, lost, re-gained, and grappled with ongoing challenges to its status in law. The article then illustrates these issues with an analysis of two key periods from Scientology’s history: its ultimately successful fight to gain tax-exempt status in the United States in the 1980s, and its response to modern-day challenges to its tax-exempt status.

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March 21, 2021 in Legal Education, Scholarship, Tax, Tax Scholarship | Permalink

The Top Five New Tax Papers

There is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new paper debuting on the list at #5. The #1 paper is #267 among 15,819 tax papers in all-time downloads:

  1. SSRN Logo (2018) [1,318 Downloads]  The Impact of Public Perceptions on General Consumption Taxes, by Rita de la Feria (University of Leeds; Google Scholar) & Michael Walpole (University of New South Wales; Google Scholar)
  2. [521 Downloads]  Tax Complexity and Transfer Pricing Blueprints, Guidelines, and Manuals, by Jean-Edouard Colliard (HEC Paris; Google Scholar), Lorraine Eden (Texas A&M; Google Scholar) & Co-Pierre Georg (University of Cape Town; Google Scholar)
  3. [507 Downloads]  A Critical Assessment of the Originalist Case Against Administrative Regulatory Power: New Evidence from the Federal Tax on Private Real Estate in the 1790s, by Nicholas Parrillo (Yale)
  4. [324 Downloads]  Inter-Nation Equity Revisited, by Ivan Ozai (McGill; Google Scholar) (reviewed by David Elkins (Netanya) here)
  5. [266 Downloads]  A Wealth of Sovereign Choices: Tax Implications of McGirt v. Oklahoma and the Promise of Tribal Economic Development, by Stacy Leeds (Arizona State; Google Scholar) & Lonnie Beard (Arkansas)

March 21, 2021 in Scholarship, Tax, Tax Scholarship, Top 5 Downloads | Permalink

Saturday, March 20, 2021

This Week's Ten Most Popular TaxProf Blog Posts

Lederman & Christians: Tax Work At The DOJ — Behind The Scenes Of A Criminal Tax Case

Professors Leandra Lederman & Allison Christians talk with Richard E. Zuckerman, the former head of the Tax Division of the U.S. Department of Justice (DOJ), about one of his most newsworthy cases. Watch as he drops the bombshell on us about his connection to certain Detroit individuals on which the 2019 movie The Irishman was based on.

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March 20, 2021 in Legal Education, Tax | Permalink

Friday, March 19, 2021

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

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

Holderness (2017)The idea of tax expenditures—those provisions of the tax law not in line with the normative base—has intuitive appeal. Of course the tax law is imperfect, but if we pinpoint the offending provisions, we can approach a more perfect code. Now where did we put that normative baseline? Harsh and compelling critiques of the tax expenditure concept essentially accuse it of masking personal preferences regarding the desirability of tax provisions, yet the concept apparently cannot be so easily killed off.

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

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March 19, 2021 in Hayes Holderness, Scholarship, Tax, Tax Scholarship, Weekly SSRN Roundup, Weekly Tax Roundup | Permalink

Tax Policy In The Biden Administration

Next Week's Virtual Tax Workshops

Tuesday, March 23: Young Ran (Christine) Kim (Utah; Google Scholar) will present Taxing Teleworkers virtually at Florida State as part of its Tax Workshop Speaker Series. If you would like to attend, please contact Jeffrey Kahn.

Thursday, March 25: Kristin Hickman (Minnesota; Google Scholar) will present OIRA Review of Tax Regulatory Activities virtually at Duke as part of its Tax Policy Workshop Series. If you would like to attend, please contact  Richard Schmalbeck or Lawrence Zelenak.

Friday, March 26: Jinyan Li (Osgoode) will present Legal Challenges in Creating a Global Tax Regime with OECD Pillar One Blueprint virtually at British Columbia as part of its Tax Law and Policy Workshop Speaker Series. If you would like to attend, please contact  Wei Cui.

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March 19, 2021 in Colloquia, Legal Education, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Pistor Presents The Code of Capital  Virtually Today At Oxford-Virginia

Katharina Pistor (Columbia) presents Chapter 6 (A Code for the Globe) of The Code of Capital: How the Law Creates Wealth and Inequality (Princeton University Press 2019) virtually at the Oxford-Virginia Legal Dialogs: Tax Meets Non-Tax Series today hosted by Tsilly Dagan and Ruth Mason:

Code of Capital 3Capital is the defining feature of modern economies, yet most people have no idea where it actually comes from. What is it, exactly, that transforms mere wealth into an asset that automatically creates more wealth? The Code of Capital explains how capital is created behind closed doors in the offices of private attorneys, and why this little-known fact is one of the biggest reasons for the widening wealth gap between the holders of capital and everybody else.

In this revealing book, Katharina Pistor argues that the law selectively “codes” certain assets, endowing them with the capacity to protect and produce private wealth. With the right legal coding, any object, claim, or idea can be turned into capital—and lawyers are the keepers of the code. Pistor describes how they pick and choose among different legal systems and legal devices for the ones that best serve their clients’ needs, and how techniques that were first perfected centuries ago to code landholdings as capital are being used today to code stocks, bonds, ideas, and even expectations—assets that exist only in law.

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March 19, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Tedds Presents Reforms For A More Just Society  Virtually Today At British Columbia

Lindsay Tedds (Calgary; Google Scholar) presents Covering All the Basics: Reforms for a More Just Society (with David A. Green (British Columbia; Google Scholar) & Jonathan Rhys Kesselman (Simon Fraser)) virtually at British Columbia today as part of its Tax Law and Policy Workshop Speaker Series hosted by Wei Cui:

Lindsaytedds2016On July 3, 2018, the Government of British Columbia announced the creation of an expert committee to “test the feasibility of a basic income in BC and help find ways to make life better for British Columbians.” The expert committee followed a two year consultation process on poverty reduction in BC, legislative poverty reduction targets, and a poverty reduction strategy. Our approach to our task was two-pronged: to undertake a public outreach process, and to co-ordinate a comprehensive research agenda related to basic income in the context of the B.C. income and social support system. Our research program consists of over 40 research papers commissioned from over 40 Canadian researchers located at universities and institutes across Canada plus a few located abroad. On January 28, 2021 our final report and all input material was made public. Dr. Tedds will join us to walk through the work of the panel, its findings, and its main recommendations.

Executive Summary

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March 19, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Tax Prof Diane Ring Named Interim Dean At Boston College

BC Law, Diane Ring Named Interim Dean:

Ring (2021)Diane Ring, the Associate Dean of Faculty at BC Law, will step into the role of Interim Dean of Boston College Law School on July 1, upon the departure of Vincent Rougeau, who is leaving after ten years at the helm of the Law School to assume the presidency of the College of the Holy Cross.

“Diane has been a valued member of our community for over fifteen years, as well as a member of my associate dean leadership team for the past three years,” said Dean Rougeau. “She also served as Associate Dean for Academic Affairs from 2010-2012, and in that role she was invaluable to me in my own transition when I was hired as dean in 2011.”

Ring will work closely with BC Law’s senior leadership over the next few months to ensure a smooth transition. “She is talented and accomplished,” Rougeau continued, “and I know this school will be in extremely capable hands as the Provost proceeds with the search process for a permanent replacement.”

In addition to her academic administration skills, Ring is a respected leader and scholar in the field of international taxation, corporate taxation, and ethical issues in tax practice at BC Law. Her recent work addresses issues including information exchange, tax leaks, international tax relations, sharing economy and human equity transactions, and ethics in international tax.

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March 19, 2021 in Legal Ed News, Legal Education, Tax, Tax News, Tax Prof Moves | Permalink

Thursday, March 18, 2021

Wilking Presents Who Bears The Cost Of A Change In Remittance Policy?: Evidence From Amazon's Voluntary Collection Agreements Virtually Today At Indiana

Eleanor Wilking (Cornell) presents Who Bears the Cost of a Change in Remittance Policy?: Evidence from Amazon's Voluntary Collection Agreements virtually at Indiana today as part of its Tax Policy Colloquium Series hosted by Leandra Lederman:

Eleanor Wilking 450x515 reduced (1)The South Dakota vs. Wayfair (2019) Supreme Court decision changed a long-standing difference in the way U.S. sales tax administrations treated online and brick-and-mortar commerce. Online retailers now have to remit sales taxes in most states. Despite the attention this decision received, we know little about how shifting the responsibility to remit from the consumer to the retailer will affect the tax system. Using states’ staggered adoption of Voluntary Collection Agreements (VCAs) which committed large online retailers to remit taxes prior to the Wayfair decision, we find that the increase in compliance resulting from these arrangements was almost fully passed-through to consumers via higher tax-inclusive prices. Consumers also reduced their online expenditures. However, we do not find strong evidence of an impact on the elasticity of the tax base. 

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March 18, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Repetti Presents Equity And Efficiency In A Progressive Income Tax Virtually Today At Duke

Jim Repetti (Boston College; Google Scholar) presents Appropriate Roles for Equity and Efficiency in a Progressive Individual Income Tax, 23 Fla. Tax Rev. 522 (2020), virtually at Duke today as part of its Tax Policy Workshop Series hosted by Richard Schmalbeck & Lawrence Zelenak:

ProfileImage.img (1)Increased focus on economic efficiency in formulating tax policy, at the expense of achieving equity, has resulted in decreased rate progressivity in our individual income tax. This decrease has exacerbated inequality.

There are several explanations for the intense focus on efficiency and reduced emphasis on equity. Predictions of efficiency gains from low individual income tax rates appear more certain than equity gains from progressive tax rates. Efficiency gains seem measurable, while equity gains appear intangible and unquantifiable. In addition, distributive justice, which underlies and shapes tax equity, exists in many abstract forms, some of which may not require progressive tax rates.

This Article argues, however, that the emphasis on efficiency is misplaced. Inequality imposes measurable costs on the health, social well-being, and intergenerational mobility of our citizens, as well as on our democratic process. This is corroborated by significant empirical analysis.

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March 18, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Bearer-Friend: Tax Without Cash

Jeremy Bearer-Friend (George Washington), Tax Without Cash, 106 Minn. L. Rev. ___ (2021):

This Article documents and evaluates tax obligations paid without cash, referred to as “in-kind tax paying.” Such forms of tax paying include paying federal income taxes by remitting a used, flatbed truck to the IRS, paying local property taxes by working a few hours a month answering phones at city hall, and paying state excise taxes by conveying a proportion of all seashells farmed within a state to that state. These are not just hypotheticals, but forms of in-kind tax paying that occur in the United States throughout periods when many taxes are also paid in cash. Nevertheless, despite its long history and prevalence, in-kind tax paying has been underexplored as a viable, and potentially appealing, form of tax remittance.

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March 18, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Burke: The Spurious Allure Of Passthrough Parity

Karen C. Burke (Florida), The Spurious Allure of Passthrough Parity, 52 Loy. U. Chi. L.J. 351 (2020):

In 2017, Congress reduced tax rates on both corporate and noncorporate income. The drafters invoked the concept of pass-through parity to justify lower rates on noncorporate business income, resulting in a new and highly controversial deduction for pass-through owners under § 199A. The concept of pass-through parity conflates equitable treatment of different entity forms with equitable distribution of the ultimate tax burden among labor and capital. The flawed rationale for § 199A may be viewed as an attempt to preserve the pre-2017 preference for pass-through income; conceptually, the advantage of lower corporate rates is limited to the availability of a higher after-tax rate of return on reinvested corporate earnings, obviating concerns about mass conversions. Despite the stated goal of distinguishing labor income from capital income in noncorporate businesses, the purported guardrails under § 199A provide a substantial subsidy for active passthrough owners by offering a lower tax rate on commingled labor and capital returns.

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March 18, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Saito: Tax Coordination

Blaine G. Saito (Northeastern), Tax Coordination, 38 Ga. St. U. L. Rev. ___ (2022):

The United States implements much of its social policy through the income tax laws. The Code is rife with tax expenditures for education, housing, community economic development, retirement savings, and health care to name a few. But the IRS is not an agency with expertise in any of these areas and developing such expertise would draw resources away from its core tax administration mission. Commentators have thus called for a series of changes from turning these tax expenditures into outlays for these programs or to divest the IRS/Treasury of most of the administration of social policy tax expenditures. Yet, given American politics and the institutional structure of the federal government, these moves are both unlikely to occur and unwise.

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March 18, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Wednesday, March 17, 2021

Liscow Presents The Psychology Of Taxing Capital Income Virtually Today In California

Zachary Liscow (Yale; Google Scholar) presents The Psychology of Taxing Capital Income: Evidence from a Survey Experiment on the Realization Rule (with Edward Fox (Michigan; Google Scholar)) virtually in California today as part of the San Diego-Davis-Hastings Tax Law Speaker Series:

Liscow_zachary-webThe realization rule is central to income tax law, but often decreases the efficiency, equity, and simplicity of the system. Given these problems, it is surprising that we do not have a good explanation for why the rule exists for liquid assets. Scholars have long speculated about the role of the public’s views here, but little is known empirically about them. We conduct the first survey experiment to understand the psychology of taxing gains on unsold assets.

We have three main findings. First, respondents strongly prefer to wait to tax gains until sale: 75% to 25%. This lack of support persists and seems strengthened when looking across a variety of other policy framings. But the flip side is that there is surprisingly strong support for taxing assets at sale or transfer, including death, in places where current law excludes gains. Second, views barely change when participants are randomly given videos explaining the pros and cons of taxing before sale, though the pro and con treatments have large effects individually.

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March 17, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Singer Presents The Due Diligence Defence For Director’s Liability In Tax Law Virtually Today At Toronto

Samuel Singer (Ottawa; Google Scholar) presents Critically Analyzing the “Reasonably Prudent Person”: The Due Diligence Defence for Director’s Liability in Tax Law (with Morena Cheng (Blake, Cassels & Graydon, Calgary)) virtually at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series:

Samuel_singer_photo_for_websiteIn Canadian tax law, directors who face liability for corporate debts may invoke the due diligence defence. A successful defence must demonstrate that the director exercised the degree of care, diligence, and skill that a reasonably prudent person would have exercised in comparable circumstances. Following the Supreme Court of Canada decision in Peoples Department Stores Inc. (Trustee of) v Peoples, the Federal Court of Appeal in Buckingham v The Queen held that the due diligence defence is an objective standard. This article critically analyzes the reasonably prudent person test in tax law after Buckingham. It argues that while the objective standard is presented as a neutral test, the degree of care, diligence, and skill that corporate directors can exercise is significantly influenced by their socioeconomic conditions and personal circumstances. The article draws on a case law review to demonstrate the ongoing and sometimes inconsistent consideration of the personal and socioeconomic circumstances of a director. Directors may experience differential treatment depending on which comparable circumstances the courts consider when applying the reasonably prudent standard. 

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March 17, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Pittsburgh Tax Review Symposium: Tribute To Nina Olson

Pittsburgh Tax Review (2017)Symposium, Tribute to National Taxpayer Advocate Nina Olson, 18 Pitt. Tax Rev. 1-189 (2020):

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March 17, 2021 in Conferences, Scholarship, Tax, Tax Conferences, Tax Scholarship | Permalink

From 'Boy Tax' And 'Girl Tax' To Diverse And Inclusive Tax

Larissa Neumann (Fenwick & West, Mountain View, CA; Lecturer, UC-Berkeley), A Virtuous Cycle: Investing in Diversity and Inclusion, 99 Tax Notes State 995 (Mar. 8, 2021):

Tax Notes StateThe call for more equal representation of women in positions of power in the tax law profession has never been louder than it is today. Companies, professional organizations, law schools, and society at large are initiating a concerted push for greater gender diversity within law firms. According to the American Bar Association’s “ABA Profile of the Profession 2020 Report,” the percentage of female lawyers has increased very slowly in the last 10 years; it stood at 31 percent in 2010 and is now at 37 percent. Male attorneys still greatly outnumber female attorneys, especially in management and equity partner positions. Although women generally have made up half of graduating law school classes for the last 20 years, there continues to be a disparity in the legal profession.

While most law firms have explicitly professed a desire for more women in leadership, implicit biases and structural impediments within the profession have kept women significantly underrepresented within the upper reaches of the tax law hierarchy. To display commitment to the firm, women who are parents have felt the pressure to submit to a work environment and time schedule at tension with their obligations as mothers and domestic partners. The recent ABA report “Walking Out the Door,” which includes results from a survey of more than 1,200 senior lawyers at the nation’s biggest private law firms, reported that 58 percent of women viewed caretaking commitments as the most important reason that female lawyers leave their jobs. To fit the mold of a dedicated professional, women have felt pressure to delay or alter the timing of significant life events such as marriage and pregnancy. Over time, the frictions of these structural impediments wear against female attorneys’ psyches, often causing them to compromise their careers for the sake of family and personal commitments.

Throughout my career I have worked in tandem with my firm, Fenwick & West LLP, to dismantle these subtle and not-so-subtle structures of male power that have stood in the way of female professional empowerment. By advocating for my own interests and having a progressive law firm that took those interests to heart, I have been able to advance in my career without disregarding my unique experiences and challenges as a wife and a mother. By seeing me and hearing me as a woman, Fenwick has demonstrated a commitment to diversity in its highest levels of power and laid the institutional foundations for many more female attorneys to follow in my footsteps.

I remember staring at the little pink lines indicating that I was pregnant with mixed emotions. I was filled with guarded joy that was also clouded with a faint concern when I thought of my career. In 2006 pregnancy announcements were not expected from first-year associates at a law firm — at least not from associates who were at all serious about becoming partners. “Wait until you are a partner until you have kids” was standard advice, and doing otherwise would sabotage your ability as a woman to prove your dedication to the firm and credibility in the profession. But my life path had taken a drastic detour from the career trajectory mapped out by conventional wisdom.

After having my first child, I returned to work eager to add value to every project I was assigned and grow in my practice as a tax attorney. Thankfully, at Fenwick, I was not spared difficult assignments and challenging projects in my days after returning from maternity. One of my mentors, Jim Fuller, recounted how when he started tax law there was “Girl Tax,” which was estates and trusts, and “Boy Tax,” which was international tax. He expressed how he thought that was inappropriate and supported my taking on challenging international tax projects, including inversion transaction, transfer pricing, and controversy.

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March 17, 2021 in Legal Education, Tax, Tax Analysts, Tax Scholarship | Permalink

Avi-Yonah, Gamage, Shanske & Stark: Is New York's Mark-to-Market Act Unconstitutionally Retroactive?

Following up on my previous post, New York's Proposed Mark-to-Market Wealth Tax Would Raise $23 Billion From <200 Billionaires:  Reuven S. Avi-Yonah (Michigan), David Gamage (Indiana), Darien Shanske (UC-Davis) & Kirk J. Stark (UCLA), Is New York's Mark-to-Market Act Unconstitutionally Retroactive?, 99 Tax Notes State 541 (Feb. 8, 2021):

AGSSIt is well known in tax literature that rudimentary tax planning strategies enable wealthy individuals to avoid state and federal income tax on much of their true economic income. Indeed, the existing income tax has been described as being effectively optional for those who derive their income chiefly from the ownership of assets rather than the provision of services. The reason is — except for a few relatively narrowly tailored deemed-realization rules — both state and federal income taxes rely on the realization principle. Under realization accounting, taxpayers generally do not owe tax on economic gains until they sell their appreciated assets. Moreover, this is so even when taxpayers fund lavish lifestyles by borrowing against their appreciated assets.

Legislation under consideration in New York would limit the ability of the state’s wealthiest taxpayers to escape tax in this manner. The Billionaire Mark-to-Market (MTM) Tax Act (S. 8277B/A. 10414) would require these taxpayers to reports gains and losses as they accrue, rather than upon sale or exchange as under current law.

Opponents claim that the MTM Act is unconstitutional. In a separate essay, we will explain why and how the New York Constitution authorizes accrual taxation through deemed realizations as in the MTM Act (and also as in a number of existing provisions of state income tax law). Here, we evaluate the retroactivity concerns that the legislation’s opponents have raised.

On its face, the MTM Act is not retroactive.

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March 17, 2021 in Scholarship, Tax, Tax Analysts, Tax Scholarship | Permalink

Tuesday, March 16, 2021

Field Presents Itemization After The TCJA: How State Election Uniformity Laws Undermined Tax Simplification Virtually Today At Florida State

Heather Field (UC-Hastings; Google Scholar) presents Itemization After the TCJA: How State Election Uniformity Laws Undermined the Goal of Simplifying the Individual Income Tax virtually at Florida State today as part of its Tax Workshop Speaker Series hosted by Jeffrey Kahn:

FieldAlmost 30 million fewer federal income tax returns with itemized deductions were filed for the 2018 tax year than were filed for 2017.  On the surface, that suggests that the TCJA’s itemization-related changes—specifically, the increase to the standard deduction and limits on itemized deductions—simplified the individual income tax system.  A closer look at the data, however, tells a more complex story.  Specifically, this Article uses federal and state individual income tax filing data from the 2017 and 2018 tax years to demonstrate that the TCJA’s impact on itemization rates varied from state to state depending, among other things, on whether the state obligated its taxpayers to make the same tax election (i.e., to itemize or take the standard deduction) for state purposes as the taxpayer made for federal purposes. 

Drawing on insights from the data analysis, this Article argues that (1) the TCJA’s itemization-related changes did not result in nearly as much simplification for individual taxpayers as the federal itemization data alone would suggest, (2) state income tax laws complicated federal tax administration by causing some taxpayers to continue to itemize for federal purposes post-TCJA even though their federal itemized deductions were less than the federal standard deduction, and (3) the TCJA’s itemization-related changes (to federal tax law) complicated tax administration for some state tax authorities, even in states with income tax laws that largely conform to federal income tax laws.

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March 16, 2021 in Colloquia, Scholarship, Tax, Tax Scholarship, Tax Workshops | Permalink

Brown Reviews Bearer-Friend's The Challenge Of Colorblind Tax Data

Jotwell (Tax) (2016)Dorothy Brown (Emory), Colorblind No More (JOTWELL) (reviewing Jeremy Bearer-Friend (George Washington), Should the IRS Know Your Race? The Challenge of Colorblind Tax Data, 79 Tax L. Rev. 1 (2019)):

The summer of 2020 opened the eyes of many to the concept of systemic racism, and some even started looking in unlikely places – like tax law. Senator Sherrod Brown (D-Ohio) acknowledged in a June 2020 hearing that “Congress writes the tax laws. If there are ways that our current tax code exacerbates racial inequity, then it’s our job to fix it.”

Senator Brown’s articulated vision will be difficult to achieve because the Internal Revenue Service (“IRS”) does not collect or publish statistics by race. I confirmed this fact in a telephone interview with an IRS employee when I was writing one of my first pieces about systemic racism and tax policy over two decades ago. I was most interested in the distribution question – whether or not taxpayers were treated differently by race. (The answer is yes — they are treated differently. I write about this in a forthcoming book, The Whiteness of Wealth: How the Tax System Impoverishes Black Americans—And How We Can Fix It.) But equally important questions were asked and answered by George Washington University Associate Professor of Law Jeremy Bearer-Friend, in his article: Should the IRS Know Your Race? The Challenge of Colorblind Tax Data. ...

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March 16, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

Bryan: The Dearth Of U.S. Tax Treaties With Latin America

Patricia A. Bryan (Miami), How Hard Can This Be? The Dearth of U.S. Tax Treaties with Latin America, 74 U. Miami L. Rev. 359 (2020):

The United States has fewer tax treaties with countries in Latin America and the Caribbean than the United Kingdom, France, Germany, Spain and even China have with such countries. After first describing ways in which tax treaties reduce barriers to cross-border trade and investment, this Article considers in turn various possible explanations for this situation.

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March 16, 2021 in Scholarship, Tax, Tax Scholarship | Permalink

D.C. Circuit: Law Prof May Be Entitled To Attorney's Fees Due To Her 'Serious Scholarly Interest' After Beating IRS In FOIA Litigation

Kwoka v. IRS, No. 19-5310 (D.C. Cir. Mar. 9, 2021):

Denver Logo (2015)This case presents a recurring question in our court: under what circumstances is a prevailing plaintiff in a Freedom of Information Act (FOIA) case—here a law professor [Margaret Kwoka (Denver)] seeking information from the Internal Revenue Service—entitled to an award of attorney’s fees? The district court denied the professor’s request for fees. For the reasons set forth below, we vacate and remand for further proceedings consistent with this opinion. ...

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March 16, 2021 in IRS News, Legal Education, New Cases, Tax, Tax News | Permalink