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Thursday, July 2, 2015

Shit Academics Say: A Social Media Experiment

TwitterChronicle of Higher Education:  @AcademicsSay: The Story Behind a Social-Media Experiment, by Nathan Hall (McGill):

I am not an intellectual, leading expert, or public scholar. I am a rank-and-file academic with the job of balancing respectable research with acceptable teaching evaluations and sitting on enough committees to not be asked to sit on more committees. And in my spare time, I run what is arguably one of the most influential academic accounts on social media: Shit Academics Say (Facebook).

Since starting the account in September of 2013, it has grown to over 122,000 followers, gaining 250 to 300 new followers daily and ranking in the top 0.1 percent across social media influence metrics such as Klout, Kred, and Followerwonk. To unpack this a bit, tweets sent from my phone while recalibrating dopamine levels on the treadmill, or waiting outside my 3-year-old’s ballet class, are showing up in about 10 million Twitter streams and generating 200,000 to 300,000 profile visits a month, effectively making @AcademicsSay a bigger "social authority" on Twitter than nearly all colleges and academic publications. Not weird at all. ...

Twitter 2

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July 2, 2015 in Legal Education | Permalink | Comments (0)

Shaviro: Taxing Potential Community Members' Foreign Source Income

Daniel Shaviro (NYU), Taxing Potential Community Members' Foreign Source Income:

Recent years have witnessed rising debate, on both sides of the Atlantic, regarding how to define the category of individuals whom a given country classifies as domestic taxpayers, and who thus may be taxable on their foreign source income (FSI) even if they live abroad. While the United States rules focus distinctively on citizenship, the broader issue is better viewed as pertaining to the taxation of “potential community members” (PCMs) – that is, all those who plausibly might be viewed as members of the home community.

This paper makes two main points regarding the taxation of PCMs on their FSI. First, the issues turn in large part on drawing a distinction between “us” and “them” – that is, between people whom we classify as members of the home community, and thus whose welfare we care about, and those whom we classify as normatively irrelevant (or less relevant) outsiders. While such a distinction is inevitable in a world with separate national governments, conventional tax policy and public economics tools shed little direct light on how one might operationalize it.

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July 2, 2015 in Scholarship, Tax | Permalink | Comments (0)

Bloomberg: Is It Time To Start Shutting Down Law Schools?

Going Out of BusinessBloomberg, Is It Time to Start Shutting Down Law Schools?:

This month, the American Bar Association provisionally accredited a new law school at Concordia University. More than 200 law schools are accredited in the U.S. An analysis of data from the ABA itself raises the question whether that list should be getting any longer. 

Law schools exist for a lot of reasons, but a pretty important one is to prepare people to be lawyers. By that standard, a large handful of institutions seem to be failing. Last year, 10 law schools were unable to place more than 30 percent of their graduating class in permanent jobs that required passing the bar, according to ABA data. Those job numbers don't include positions that schools fund for their graduates or people who say they are starting their own practice.

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July 2, 2015 in Legal Education | Permalink | Comments (0)

Morriss: BEPS, FATCA & EU Tax Harmonization: Seeing The Taxman

Andrew P. Morriss (Dean, Texas A&M), Seeing Like A Taxman:

The world of international financial regulation and taxation is in turmoil. New initiatives from the United States, the OECD and the European Union seek to reign in tax avoidance and evasion through a wide array of measures. These include the US FATCA, the OECD's base erosion and profit shifting (BEPS) initiative, and EU tax harmonization measures. As Richard Gordon and I have argued elsewhere, these measures were generally adopted without regard to whether the benefits they might yield in revenue collection are worth the costs they impose [Moving Money: International Financial Flows, Taxes, & Money Laundering, 35 Hastings Int'l & Comp. L. Rev. (2014)]. Why then do they continue to appear?

Scott 3One advantage academics have in such circumstances is to bring to bear ideas from outside a narrow field that can help make sense of events by providing a framework for analysis. Two books by James C. Scott, a political scientist and anthropologist at Yale, offer a perspective on anti-avoidance and anti-evasion measures that can suggest where things might be headed. In Seeing Like a State: How Certain Schemes to Improve the Human Condition Have Failed (Yale 1998), Scott drew on his work in Southeast Asia to analyze why many ambitious development projects failed. In The Art of Not Being Governed: An Anarchist History of Upland Southeast Asia (Yale 2009), he looked at the history of upland people who avoided incorporation into pre-colonial and colonial states by running away. We can use Scott's analysis as an opportunity to re- think how governments are approaching tax avoidance and tax evasion. In doing so, I am stretching Scott's analysis well beyond where he deployed it. Nonetheless, the analogy between Southeast Asian societies and modern tax avoidance and evasion is a powerful one.

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July 2, 2015 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Rethinking Measures Of Quality And Value In The U.S. News Law School Rankings

2016 U.S. News RankingsChristopher J. Ryan (Vanderbilt), Crunching the Numbers: Rethinking Measures of Quality and Value in National Law School Rankings:

Rankings have become an important, if not essential, element of the law school environment since U.S. News & World Report (“U.S. News”) first began publishing law school rankings in 1987. Since the rankings’ first publication, a new fixation on standings took hold of pre-law school consumers, as well as legal academe, coinciding with a historic rise in law school applicants, students, and graduates.However, in the wake of the Great Recession, since 2013, the law school luster has dulled, due in part to increased concern over increasing tuition and student debt, concurrent with diminishing prospects of employment upon graduation. As these disturbing trends illustrate, both the legal profession and legal education are at a crossroads. Still — and perhaps because of legal education has historically been slow to evolve — the U.S. News rankings are an important, if not essential, element of the new law school environment. While several alternative rankings have begun to gain traction in recent years, for better or for worse, the U.S. News ranking has become the “gold standard of the ranking business,” as well as a proxy for determining a law school’s quality and value.

Good ranking systems help consumers of information determine quality and value; however, many have attacked the U.S. News methodology — whose quality assessment, a survey of scholars and lawyers for their ranking of an institution’s reputation, accounts for 40%, whose measures of selectivity comprising 25%, and whose measures of student and faculty diversity account for 0% of a law school’s total score — and its standard of law school rankings as both a product and a source of stagnation in legal education (Arewa, et al., 2013 [Enduring Hierarchies in Legal Education, 89 Ind. L.J. 941]; Morris & Henderson, 2008 [Measuring Outcomes: Post-Graduation Measures of Success in the U.S. News & World Report Law School Rankings, 83 Ind. L.J. 791]; Black & Caron, 2006 [Ranking Law Schools: Using SSRN to Measure Scholarly Performance, 81 Ind. L.J. 83]). New measures assessing institutional quality and value, as well as diversity, can and should be developed to address the relevancy of legal education in the 21st Century.

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July 2, 2015 in Law School Rankings, Legal Education | Permalink | Comments (1)

Weidner: Capital Accounts In LLCs And Partnerships

Donald J. Weidner (Dean, Florida State), Capital Accounts in LLCs and in Partnerships: Powerful Default Rules and Potential Tax Significance, 14 Fla. St. U. Bus. Rev. 1 (2015):

Balance sheets for limited liability companies and for partnerships differ from corporate balance sheets in one important respect. Accounting for these alternative forms traditionally includes a separate equity account, or “capital account,” for each owner. Accounting practice and case law suggest that, at least as a default rule or norm, these accounts guide distributions on liquidation or buyout, and, if negative, may also reflect debts to the firm. Indeed, the statutory default rule of partnership law in most states requires that individual capital accounts be maintained and given economic significance on liquidation or buyout. Although the statutory law of LLCs does not contain these default rules, partnership law provides analogy. Furthermore, the federal income tax rules that apply both to partnerships and to most multi-member LLCs closely examine the maintenance and significance of capital accounts to determine the validity of special allocations of tax benefits. Finally, capital accounts analysis also sharpens the understanding of the economic arrangement of the owners, particularly with respect to how and to what extent they have agreed to share different items of loss.

July 2, 2015 in Scholarship, Tax | Permalink | Comments (0)

Three Rules for Educating Tomorrow's Lawyers

ThreeMichael D. Cicchini, Three Rules for Educating Tomorrow's Lawyers, 34 Miss. C. L. Rev. 1 (2015):

Legal education reform is currently a hot topic. The most promising ideas involve elevating skills-based training from its current sideshow status (where it is taught by adjunct and clinical instructors) to a meaningful and integral part of the mainstream curriculum. This type of skills-based reform, however, not only faces some practical roadblocks, but also it glosses over legal education’s deeper, more fundamental problem: the failure to adequately train students in the underlying substantive and procedural law. To address this more immediate issue, this Essay recommends three basic rules for reform.

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July 2, 2015 in Legal Education, Scholarship | Permalink | Comments (2)

The IRS Scandal, Day 784

IRS Logo 2World, Investigators Find Proof IRS Destroyed Evidence in Targeting Scandal:

Two Treasury Department inspectors general revealed last week someone erased computer evidence during the investigation into the IRS targeting scandal—months after the agency was ordered to preserve the documents.

Timothy Camus and J. Russell George made the disclosure during a Thursday hearing of the House Oversight and Government Reform Committee. They said 422 backup tapes were destroyed and about 24,000 emails were lost in March 2014, the same month IRS Commissioner John Koskinen told Congress the agency was fully complying with the investigation.

The controversy revolves around Lois Lerner, former head of the IRS tax-exempt division, who acknowledged in 2013 her department improperly singled out conservative groups for extra scrutiny. Investigators discovered her computer crashed in 2011, and government IT specialists were unable to detect why. Camus and George said Lerner borrowed multiple computers on loan and deleted thousands of emails. ...

Despite a subpoena order to provide documents, IRS employees working night shifts demagnetized the contents of Lerner’s’ computers, according to the inspectors general. They said Koskinen failed to inform the employees about the May 2013 subpoena order to preserve the documents.

Rep. Jody Hice, R-Ga., suggested Koskinen committed a crime by lying to Congress about the availability of the emails. He said Americans are “sick and tired of being snookered” by the government.

“I urge you to hold these people accountable,” said Rep. Jason Chaffetz, R-Utah, chairman of the committee. He and other Republicans called the ongoing IRS scandal worse than Watergate.

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July 2, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Wednesday, July 1, 2015

Palfrey: BiblioTech — Why Libraries Matter More Than Ever In The Age Of Google

PalfreyJohn Palfrey (Head of School, Phillips Academy; former Henry N. Ess III Professor of Law & Vice Dean for Library and Information Resources, Harvard Law School), BiblioTech: Why Libraries Matter More Than Ever in the Age of Google (May 2015):

Libraries today are more important than ever. More than just book repositories, libraries can become bulwarks against some of the most crucial challenges of our age: unequal access to education, jobs, and information.

In BiblioTech, educator and technology expert John Palfrey argues that anyone seeking to participate in the 21st century needs to understand how to find and use the vast stores of information available online. And libraries, which play a crucial role in making these skills and information available, are at risk. In order to survive our rapidly modernizing world and dwindling government funding, libraries must make the transition to a digital future as soon as possible—by digitizing print material and ensuring that born-digital material is publicly available online.

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July 1, 2015 in Book Club, Legal Education, Scholarship | Permalink | Comments (0)

Are Academic Law Libraries Doomed?

Law LibraryYesJames Milles (SUNY-Buffalo), Legal Education in Crisis, and Why Law Libraries are Doomed, 106 Law Libr. J. 507 (2014):

The dual crises facing legal education - the economic crisis affecting both the job market and the pool of law school applicants, and the crisis of confidence in the ability of law schools and the ABA accreditation process to meet the needs of lawyers or society at large - have undermined the case for not only the autonomy, but the very existence, of law school libraries as we have known them. Legal education in the United States is about to undergo a long-term contraction, and law libraries will be among the first to go. A few law schools may abandon the traditional law library completely. Some law schools will see their libraries whittled away bit by bit as they attempt to answer “the Yirka Question” in the face of shrinking resources, reexamined priorities, and university centralization. What choices individual schools make will largely be driven by how they play the status game.

NoKenneth J. Hirsh (Cincinnati), Like Mark Twain: The Death of Academic Law Libraries Is an Exaggeration, 106 Law Libr. J. 521 (2014):

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July 1, 2015 in Legal Education, Scholarship | Permalink | Comments (3)

Pittsburgh Tax Review Publishes New Issue

Pittsburgh Tax Review The Pittsburgh Tax Review has published Vol. 12, No. 1 (Fall 2014):

July 1, 2015 in Scholarship, Tax | Permalink | Comments (0)

Nobel Laureate: Replace Student Evaluations With Best Practices

BestChronicle of Higher Education, Amid Criticism of Student Evaluations, Nobel Laureate Offers Alternative:

The list of complaints about how colleges conduct course evaluations is long and seems to keep getting longer. A survey released last week of thousands of professors by the American Association of University Professors found that student evaluations are losing much of the value they once had. Earlier research already showed that student evaluations failed to adequately describe teaching quality, and often reflected judgments about an instructor’s appearance. But if not student evaluations, what should colleges use to judge the effectiveness of teaching?

Carl E. Wieman, a Nobel Prize-winning physicist and professor at Stanford University’s Graduate School of Education, says he may have found an answer. In a paper published recently in Change magazine, Mr. Wieman suggests another form of evaluation: judging professors based on an inventory of their teaching practices. The ultimate measure of teaching quality, he argues, is the extent to which professors use practices associated with better student outcomes.

"It may seem surprising to evaluate the quality of teaching by looking only at the practices used by an instructor," Mr. Wieman wrote in the paper. But he said research over the past few decades had established a correlation between the teaching methods used and the amount of student learning.

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July 1, 2015 in Legal Education | Permalink | Comments (3)

Jeb Bush Releases 33 Years Of Tax Returns

Bush

Jeb Bush yesterday released 33 years of tax returns, more than any presidential candidate in history. 

Jeb 2
According to a letter from former IRS Chief Counsel Hap Shashy, the head of King & Spalding's Tax Practice Group, Governor Bush paid an effective tax rate of 36% over those years (summary).

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July 1, 2015 in Political News, Tax | Permalink | Comments (1)

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July 1, 2015 in About This Blog, Legal Education, Tax | Permalink | Comments (0)

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July 1, 2015 in About This Blog, Legal Education, Tax | Permalink | Comments (0)

The IRS Scandal, Day 783

Tuesday, June 30, 2015

NYU Tax Law Review Publishes New Issue

NYU Law (2014)The Tax Law Review has published a new issue (Vol. 68, No. 1 (Fall 2014)):

June 30, 2015 in Scholarship, Tax | Permalink | Comments (0)

Call For Estate Planning Papers: ACTEC Law Journal

ACTECCall For Papers:  ACTEC Law Journal:

Estate Planning In the 21st Century:  Seismic Shifts and Predictions for the Future

The American College of Trust and Estate Counsel announces a Call For Papers on the following topics:

Estate planning has radically changed in the last several decades.   Statutes such as the Uniform Probate Code and the Uniform Parentage Act altered the presumptive definitions of such terms as "children" and "descendants" to include a much broader range of beneficiaries, including adoptees, out-of-wedlock children, and in some cases foster children and stepchildren.  Some children may now inherit from more than two parents.  Very recent changes have broadened those allowed to marry and thus inherit in intestacy from each other.  The assets dealt with by estate planners have transformed dramatically, with the rise in the acceptance of non-probate forms of title, digital assets, etc.  Perpetual trusts, once allowed only for charities, now exist for families, with attendant issues such as decanting, virtual representation, and non-judicial trust modification.  Advance health care directives have become a common tool in the estate planner's box, and in a few states estate planners may deal with clients opting for physician aid in dying.  Papers will address ways in which estate planning has transformed in the last 20, 30 or 40 years, and how it may continue to change over a comparable time in the future. 

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June 30, 2015 in Legal Education, Scholarship, Tax | Permalink | Comments (0)

Avi-Yonah: The International Tax Regime — A Centennial Reconsideration

Reuven S. Avi-Yonah (Michigan), The International Tax Regime: A Centennial Reconsideration:

The international tax regime is almost a hundred years old. The two principles it is based on (the benefits principle and the single tax principle) were developed in the 1920s and 1930s. The regime functioned reasonable well until the 1980s, where globalization led to tax competition that undermined its principles. As the OECD is reconsidering the regime in the context of the BEPS and MAATM projects, now is a good time to rethink the fundamentals. Upon reconsideration, it is clear that the regime cannot function without multilateral consensus, and that such consensus is easier to achieve among source countries in the case of passive income and residence countries in the case of active income. This, in turn, suggests that the priorities underlying the benefits principle need to be reversed.

June 30, 2015 in Scholarship, Tax | Permalink | Comments (0)

Reynolds Reviews Barton's The Decline And Rebirth Of The Legal Profession

GlassFollowing up on my previous post:  Glenn Reynolds reviews the new book by Benjamin H. Barton (Tennessee), Glass Half Full: The Decline and Rebirth of the Legal Profession (Oxford University Press, June 15, 2015), in USA Today, Are Happier Lawyers, Cheaper Legal Fees on the Horizon?:

Barton notes that high-end law firms are being squeezed by much-greater client sensitivity to costs, and by technology that lets one junior attorney do the work of ten when reviewing documents. (Increased efficiency isn't a plus when you bill by the hour.) Likewise, lawyers at the bottom end are being squeezed by online legal form services like LegalZoom or Rocket Lawyer. Still, he sees some upsides for lawyers and clients alike.

For lawyers, he sees incomes falling to the more-modest levels that prevailed before the 1980-2000 legal boom. Lower incomes are bad, of course, but it's also true that prior to the boom, lawyers were happier with their work. Crushing workloads, dog-eat-dog firm politics and fickle clients made the boom time much more stressful. The move to billing arrangements that focus on results, not hours worked, saves clients money, but it also changes the way lawyers work, probably for the better.

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June 30, 2015 in Book Club, Legal Education | Permalink | Comments (0)

The Tax Lawyer Publishes New Issue

The Tax Lawyer (2013)The Tax Lawyer has published Vol. 68, No. 3 (Spring 2015):

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June 30, 2015 in ABA Tax Section, Scholarship, Tax | Permalink | Comments (0)

Jury Rejects Unsuccessful Conservative Faculty Candidate's Discrimination Suit Against University of Iowa Law School

WagnerFollowing up on my previous posts (links below):  Iowa Press-Citizen, Jury Rejects Conservative's Bias Suit Against UI Dean:

The former dean of the University of Iowa law school didn't commit illegal political discrimination when she passed over a conservative lawyer for teaching jobs, a jury ruled Monday.

After a six-day trial, a federal jury in Davenport rejected Teresa Manning's assertion that then-Dean Carolyn Jones rejected her for the faculty because of Manning's political beliefs and associations. ...

A UI law graduate, Manning had moved back to Iowa from Washington to work as associate director of the law school's writing center when she was one of three finalists for two job openings in 2007. She had previously taught writing at George Mason University law school. But after she gave a talk to faculty members as part of the hiring process, the faculty recommended that Jones hire another finalist who was a self-described liberal and not fill the second opening.

Jones went along with those recommendations even though an associate dean had warned her in an email that he worried professors were blocking Manning "because they so despise her politics (and especially her activism about it)."

Several professors disputed that, testifying that Manning essentially disqualified herself during the interview. They said that Manning responded to a question by saying that she wouldn't teach analysis — a key part of the job — and would focus on writing. Manning argued that claim was bogus and fabricated to justify discrimination.

Manning claimed that the opposition to her appointment was driven by Professor Randall Bezanson, who helped draft the Roe v. Wade decision that legalized abortion in 1973 while he was a clerk for Justice Harry Blackmun. At the time, the 50-member faculty included 46 registered Democrats. Since then, the faculty has become at least slightly more politically diverse. ...

Her book, tentatively titled, "Academic Injustices: One woman's fight against bias in higher education and the law," is scheduled for release in January, Encounter Books president Roger Kimball said. He said her story was "worth telling" regardless of how the trial came out.

Prior TaxProf Blog coverage:

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June 30, 2015 in Legal Education | Permalink | Comments (0)

New 'Gainful Employment' Rule Spells Trouble For For-Profit Law Schools (And Would For 50 Non-Profit Law Schools)

American Lawyer LogoAmerican Lawyer:  New Rule Spells Trouble for For-Profit Law Schools, by Matt Leichter:

Advocates for student debtors chalked up a victory in May, when a New York federal judge dismissed a challenge to the U.S. Department of Education's "gainful employment rule." The rule, slated to go into effect next month, will limit for-profit colleges' access to federal student loans on the basis of their graduates' incomes and debts. The Obama administration enacted the rule to curb what it perceives as abuses by the for-profits—namely, enrolling students with a low likelihood of success and encouraging them to borrow large sums. Graduates often cannot find suitable work for their credentials and remain shackled to their loans. Or they default without any consequences to their schools. ...

Most ABA-accredited law schools will hardly suffer any effects. Only six law schools are run for profit, and one of them, Charleston School of Law, is already teetering. The remaining 200 are either private nonprofits or public institutions, so the rule won't apply to them at all, even though many of them arguably serve their students no better than the for-profits the gainful employment rule means to target.

Those six for-profits law schools, though, will be in trouble because they rely substantially on federal student loans. ... For the six for-profit law schools, the question is how much an average graduate would need to earn for the schools to keep or lose their federal student loan eligibility. For most of the schools, the number is quite high. Here is a table showing the average debt disbursed to 2014 law school graduates at the six schools, using a 20-year repayment plan—which is what the rule requires of professional and doctoral programs—and assuming a 7 percent interest rate. The source is U.S. News and World Report's annual graduate debt rankings.

Using this table, it's fairly simple to apply the rule. The two annual income columns show the minimum average earnings graduates would need to either pass or stay "in the zone." The same goes for the two columns on the far right, which show the minimum discretionary incomes.

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June 30, 2015 | Permalink | Comments (3)

The IRS Scandal, Day 782

IRS Logo 2Forbes:  IRS Won't Release Lois Lerner Emails -- Because They Might Be Duplicates, by Robert W. Wood:

Eureka! The IRS says it may have found 6,400 more emails from Lois Lerner. What do they say? Who are they targeting? We don’t know, as the IRS says it won’t release them. The reason?

This is a good one. Not only the IRS, but the Obama Justice Department is weighing in on this. We need to be sure we have not already released these emails, they say. After all, they might be duplicates. We don’t even want members of Congress to see these until we can determine if we already provided them. ...

Of course, the IRS said in 2014 (a little late?) that Ms. Lerner’s computer crashed in 2011. Oops, no one’s fault that we lost a few years’ worth of emails. We kept being reminded how hard the IRS looked and how terribly expensive it was that the IRS had to do this. But the inspector general found about 35,000 emails from recycled back-up tapes.

It then turned out that the key IRS IT people weren’t even asked to look at back up tapes. Isn’t this a little insulting? The IRS’s admission that it couldn’t find Lerner’s emails reinvigorated congressional investigations into the IRS. Of course, the IRS sort of apologized in May 2013 for singling out Tea Party groups seeking tax-exempt status. But the seeming cover-up doesn’t exactly seem sorry.

One email from former IRS firebrand Lois Lerner is particularly revealing. Sure, she said she did nothing wrong, she was the victim, and she still took the Fifth. But in February 2012, she wanted to “put together some training points to help them [IRS staffers] understand the potential pitfalls” of revealing too much information to Congress. This is the IRS version of don’t tell. You might have assumed that retired but officially silent Lois Lerner–who ran a key IRS division–might face charges.

Congress found her in contempt after she professed her innocence, and thereafter took the Fifth. Much later, she broke her silence to Politico, saying she did nothing wrong, claiming that she was the victim. The U.S. Attorney’s Office was supposedly considering prosecution, but now it announced she is off the hook and will not be charged with contempt. So said a seven-page letter the U.S. Attorney–on his last day in office–sent to Speaker John A. Boehner with the news and its rationale.

Wouldn’t some answers be nice? There is arguably no part of the government more important than our tax system. Our country cannot exist without it. Our tax code and how we administer it could be improved. Yet it is still a system with integrity, one that is administered mostly on the honor system. IRS employees deserve better than the black eye they are getting over this mess. American taxpayers deserve better too.

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June 30, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Monday, June 29, 2015

Bezos, Jobs & Musk: Must Visionary Leaders Be Cruel To Their Employees?

LogosNew York Times, The Bad Behavior of Visionary Leaders:

As I was reading Ashlee Vance’s Elon Musk: Tesla, Space X and the Quest for a Fantastic Future, I was alternately awed and disheartened, almost exactly the same ambivalence I felt after reading Walter Isaacson’s Steve Jobs and Brad Stone’s The Everything Store: Jeff Bezos and the Age of Amazon.

The three leaders are arguably the most extraordinary business visionaries of our times. Each of them has introduced unique products that changed – or in Mr. Musk’s case, have huge potential to change – the way we live.

I was awed by the innovative, courageous, persistent and creative ways all three built their businesses. I also love their products. I own a Mac Pro and an iPhone, and I have been a loyal customer of Apple for 20 years. I buy many books and other products on Amazon, lured by a blend of low prices, ease of purchase and reliably quick delivery. The Tesla X is hands down the best car I have ever driven, and it’s all electric, rechargeable in your garage.

Plainly, I have bought in to what these guys are selling.

What disheartens me is how little care and appreciation any of them give (or in Mr. Jobs’s case, gave) to hard-working and loyal employees, and how unnecessarily cruel and demeaning they could be to the people who helped make their dreams come true. ...

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June 29, 2015 in Legal Education, Tax | Permalink | Comments (4)

2015 Brophy Law School Rankings: Median LSAT, Full-Time J.D.-Required Jobs, And Law Review Citations

Alfred L. Brophy (North Carolina), Ranking Law Schools, 2015: Student Aptitude, Employment, and Law Review Citations (more here):

This essay builds on a paper released last year that ranked law schools on three variables: the median LSAT of entering students of the most recent class, the most recently available employment outcome for each school’s graduates, and citations to each school’s main law reviews over the past eight years. This paper updates that study with LSAT median data for the class entering in fall 2014, employment data for the class graduating in 2014 ten months after graduation, and the most recent law review citation data for 2007 through 2014. It studies 195 ABA approved law schools.

In addition to using more recent data, this study changes the method of combining those data. Where the last paper used simple ranks for each variable and averaged them, this study has a more granular approach to the data. It converts each school’s median LSAT score and the percentage of students employed in full-time, permanent, JD-required jobs ten months after graduation (excluding school-funded positions and solo practitioners) to standard scores. In addition, given the dramatic differences in number of law review citations among schools, it employs a common log transformation of law review citations and then converts the transformed scores to standard scores. The paper combines the first two scores to provide a two-variable ranking, and then combines all three variables to provide a three-variable ranking. The paper reports average scores for the three-variable ranking, thus permitting examination of how close schools are to each other. It also ranks the 195 ABA-approved law schools in the United States (excluding the three schools in Puerto Rico) that U.S. News included in its rankings released in March 2015. And it compares the new, two- and three- variable rankings to the U.S. News provided ranks in March 2015. It identifies the schools that improve and decline the most with the new rankings.

Here are the Top 25:

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June 29, 2015 in Law School Rankings, Legal Education | Permalink | Comments (3)

ABA: The Most LGBT-Friendly Law Schools

WhiteABA Commission on Sexual Orientation and Gender Identity, LGBT-Friendly Law Schools:

Most law schools are LGBT-friendly. Some law schools, however, are going an extra step further to be more inclusive of LGBT students. These law schools have established associations and forums designed to enhance educational opportunities for  LGBT students:

June 29, 2015 in Legal Education | Permalink | Comments (0)

University of Cincinnati President Turns Down $200,000 Bonus, Gives Money To Charities, Slain Police Officer's Family

OnoHuffington Post, College President Turns Down $200,000 Bonus, Gives Money To Charities:

University of Cincinnati President Santa Ono has rejected his annual bonus, asking for the money to instead be donated to charities and scholarships, WCPO reported. Ono has also turned down a raise in his base salary.

"This may sound crazy, but it's hard for us when someone turns down a raise," University Board President Tom Humes told the news outlet. "But we've learned that the way to satisfy President Ono is to give him the ability to help others.”

Since becoming president in 2012, Ono has not accepted his yearly bonus. This year, the $200,000 bonus will be divided among 14 organizations and scholarships, according to WCPO, including the university’s LGBTQ center, a local STEM high school, and GEN-1 House, a program for first-generation college students.

The president will also give $10,000 from the bonus money to the family of Sonny Kim, a police officer killed in a shootout last Friday, Cincinnati.com reported. Ono has also offered full tuition to UC to the three sons of fallen officer. While, according to the news site, the Ohio Revised Code requires state universities to pay up to four years of tuition to the children of police officers who die in duty, the university will further cover full room and board should they attend, Ono wrote on Twitter.

(Hat Tip: Francine Lipman.)

June 29, 2015 in Legal Education | Permalink | Comments (4)

Seto: The Tax Implications of Obergefell v. Hodges

Seto (2014)TaxProf Blog op-ed:  The Tax Implications of Obergefell v. Hodges, by Theodore P. Seto (Loyola-L.A.):

In Obergefell v. Hodges, 576 U. S. ____ (June 26, 2015), the Supreme Court held that (1) state laws banning same-sex marriage are “invalid to the extent they exclude same-sex couples from civil marriage on the same terms and conditions as opposite-sex couples” and (2) “there is no lawful basis for a State to refuse to recognize a lawful same-sex marriage performed in another State on the ground of its same-sex character.” The decision’s most profound impact will undoubtedly be on individuals’ lives and relationships, not on their tax returns. Nevertheless, it has significant implications for the substance and administration of both state and federal tax law.

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June 29, 2015 in New Cases, Tax | Permalink | Comments (0)

Halperin: Corporate Rate Reduction And Fairness To Passthrough Entities

HalperinDaniel Halperin (Harvard), Corporate Rate Reduction and Fairness to Passthrough Entities, 147 Tax Notes 1299 (June 15, 2015):

There is considerable support for reducing the corporate tax rate but not for a corresponding reduction in individual rates. Since it seems likely that corporate rate reduction would have to be financed by reduction or even elimination of many tax preferences for business income equitable treatment of pass-throughs is a vexing problem. The article suggests a possible approach to fairness to pass-throughs which follows from recognition of the actual benefit of reducing corporate rates that I described in 2010 [Mitigating the Potential Inequity of Reducing Corporate Rates, 126 Tax Notes 641 (Feb. 10, 2010)].

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June 29, 2015 in Scholarship, Tax | Permalink | Comments (1)

Whitey Bulger's Advice To Young People: Go To Law School

WhiteyNew York Times, Jailed Crime Boss’s Tip to Students: Go to Law School:

James (Whitey) Bulger, the former Boston crime boss, has offered advice for three high school girls who wrote to him for a history project: Crime does not pay.

Mr. Bulger sent the handwritten letter, dated Feb. 24, from the federal prison in Florida where he is serving two life sentences, The Boston Globe reported Sunday.

“My life was wasted and spent foolishly, brought shame and suffering on my parents and siblings and will end soon,” he wrote.

“Advice is a cheap commodity. Some seek it from me about crime. I know only one thing for sure: If you want to make crime pay go to law school.”

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June 29, 2015 | Permalink | Comments (1)

The IRS Scandal, Day 781

IRS Logo 2New York Observer, Judge Sullivan Demands Answers from the IRS by Month’s End; It’s Past Time for Orange to be the New Black for Lois Lerner, by Sidney Powell:

Just a day after our most recent article about our “Shameless IRS” and its continued stonewalling, federal Judge Emmet G. Sullivan has demanded that the IRS answer his questions and respond to Judicial Watch in a report that the IRS must file by June 29th. In its “supplemental report,” the IRS must disclose “any new information regarding: (1) [The Treasury Inspector General for Tax Administration] TIGTA’s recovery of emails from the backup tapes; (2) TIGTA’s production of emails to the IRS; (3) the IRS’s review of emails and production to the plaintiff; and (4) the status of the TIGTA investigation. This report shall be filed by no later than June 29, 2015.”

As we previously reported, Judge Sullivan is the federal judge who appointed a special prosecutor to investigate the Department of Justice and its “Public Integrity Section” prosecutors upon their corrupted prosecution of former United States Senator Ted Stevens. Now Judge Sullivan is presiding over the Freedom of Information Act Suit brought by Judicial Watch to recover, among other things, the “missing” emails of Lois Lerner and her comrades in their efforts to harass and discriminate against conservative groups seeking tax exempt status.

All thinking Americans are fed up with the arrogance. Entitlement and disdain for the law demonstrated repeatedly by the IRS officials, especially Commissioner Koskinen, who is now proved by his own Inspector General to have lied to Congress when he claimed the IRS had made every effort to find the missing emails and backup tapes. ...

Judge Sullivan has also set a hearing for July 1 at 1:30 in his courtroom. If the IRS has not sufficiently answered his questions in writing, there’s no doubt they will be called upon to do so in person. This hearing may be worthy of concession sales. It’s past time for “orange to be the new black” for some people in the IRS.

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June 29, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

TaxProf Blog Weekend Roundup

Sunday, June 28, 2015

Is It Robbing God To Tithe On Your After-Tax (Not Gross) Income?

TitheChristianity Today, Is It Robbing God to Tithe on Your After-Tax (Not Gross) Income?:

Frederica Mathewes-Green, No, It’s Robbing Yourself:

[T]he best I can say is: at least try. Aim to give a percentage of your income. Start with whatever percentage you give now, and raise it a little each year. In time, you will reach the tithe.

Then you will be giving as generously as the people of the Bible, who lived in conditions we would see as abject poverty. Like them, pay God before you pay Caesar, for there is no better indication of your priorities.

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June 28, 2015 in Tax | Permalink | Comments (2)

The Top 5 Tax Paper Downloads

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

  1. [369 Downloads]  Taxation of E-Commerce, by Orkhan Abdulkarimli (Baku State)
  2. [304 Downloads]  Trust Decanting: A Sale Without Gain Realization, by Jason Kleinman (Herrick, New York)
  3. [184 Downloads]  Reducing Inequality With A Retrospective Tax On Capital, by James Kwak (Connecticut)
  4. [171 Downloads]  Citizenship Taxation, by Ruth Mason (Virginia)
  5. [158 Downloads]  What Does Voluntary Tax Compliance Mean?: A Government Perspective, by J. T. Manhire (U.S. Treasury Department)

June 28, 2015 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Tax Prof Baby Shower

My wife was delighted to host a baby shower yesterday for our dear friend and Pepperdine tax colleague Khrista Johnson:

Shower

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June 28, 2015 in Legal Education, Tax, Tax Profs | Permalink | Comments (1)

The IRS Scandal, Day 780

IRS Logo 2Forbes:  Joan Farr Claims IRS Denial Of Exempt Status Is Example Of Persecution Of Christians, by Peter J. Reilly:

Joan Farr tells me that the IRS denial of exempt status to the Association For Honest Attorneys is another instance of an organization being persecuted because it is Christian and conservative.  I contacted Ms. Farr, because I was pretty sure that PLR 201524206, a revocation of exempt status, was referring to A.H.A.!. (On the A.H.A.! website she is listed as Joan Heffington, which is the name she used while running for Governor of Kansas in the 2010 Republican primary.  In her 2014 run for the Senate as an independent she went by Joan Farr. Ms. Farr is a widow and Farr was her maiden name which she has readopted.) Ms. Farr confirmed that A.H.A.! was the organization in the ruling. ...

Ms. Farr indicates the “facts” in the ruling are inaccurate.  Here is the IRS version. The agent determined that some of the services that AHA provided for compensation were not related to its exempt purpose and should have been taxed as UBTI.

The agent found many transactions for personal expenses and at least one instance of an expenditure related to the campaign for governor.

During the review of the bank statements, the agent found a check written to “cash”. The memo section the check reflected “cash for campaign“. The agent asked to provide the exempt purpose of this payment. said this check was for repayment of the loan.

So you have UBTI, inurement and political activity.  Other than that Mrs. Lincoln how did you enjoy the play?

Ms. Farr had loaned the organization a lot of money, so any expenditures not related to the exempt purpose were actually loan repayments.  This ended up leading to an attempt to reconstruct the loan balance, which took a lot of effort on Ms. Farr’s part, but ended up not satisfying the IRS.

Ms. Farr indicated that AHA had never grossed more than $25,000 meaning it never had to file a complete Form 990.  Based on the drama about the loan balance, it was clear that nobody was maintaining a general ledger.  Revenue agents are trained as accountants and it makes accountants happy when they have a general ledger with everything classified.  I also have to say that having an entity pay back your loan by paying your bills for you is a very bad idea.  If there had been a general ledger with those items charged to the officer loan accountant that would have been better, but much better would be the two step process of a loan repayment via a check to Ms. Farr and her paying the bills out of her personal account.

I can’t rule out that the selection of her organization for audit had something sinister behind it, but having spoken to her a bit, I could understand how she might exhaust the patience of a revenue agent.  Inserting an accountant between her and the IRS might have saved the day.  On the other hand you have to wonder why this organization would be a priority with the IRS.

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June 28, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Saturday, June 27, 2015

This Week's Ten Most Popular TaxProf Blog Posts

Billionaires’ Bluff: How America’s Richest Families Hide Behind Small Businesses And Family Farms In Effort To Repeal Estate Tax

Public Citizen LogoPublic Citizen, Billionaires’ Bluff: How America’s Richest Families Hide Behind Small Businesses and Family Farms in Effort to Repeal Estate Tax:

Through their own family businesses, trade associations, and interest groups, America’s wealthiest families and most well-known brands have driven the effort to repeal the estate tax, while perpetuating the idea that the tax hurts America’s family farms and small businesses. This report shows that nine families owning approximately $137 billion in assets have lobbied directly on the issue in recent years, despite claims by estate tax opponents that their efforts are driven chiefly by concerns over family farms and small businesses. If the law were repealed, these nine families would stand to save more than $25.7 billion in estate taxes, and perhaps as much as $54.8 billion.

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June 27, 2015 | Permalink | Comments (4)

IRS Employees Can Use 'Password' As A Password? No Wonder We Get Hacked

IRS Logo 2The Guardian, IRS Employees Can Use 'Password' as a Password? No Wonder We Get Hacked:

The public is finally starting to learn what security experts have been warning for years: the US government has no idea what it’s doing when it comes to cybersecurity. Worse, the government’s main “solutions” may leave all our data even more vulnerable to privacy violations and security catastrophes. ...

The New York Times reported this weekend that the IRS’s systems still allow users to set their passwords to “password,” along with other hilariously terrible mistakes.

June 27, 2015 in IRS News, Tax | Permalink | Comments (3)

The IRS Scandal, Day 779

IRS Logo 2The Weekly Standard, Republicans Consider Impeaching IRS Chief:

Republican Jim Jordan went on Fox News this morning to discuss the fact that Republicans in the House of Representatives are considering impeaching the head of the IRS, John Koskinen.

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June 27, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, June 26, 2015

Herzig: The Tax Implications Of Today's Supreme Court Same-Sex Marriage Decision

HerzigTaxProf Blog op-ed:  The Tax Implications Of Today's Supreme Court Same-Sex Marriage Decision, by David Herzig (Valparaiso):

Last June, in Windsor, the Supreme Court decided that section 3 of the Defense of Marriage Act (“DOMA”) was unconstitutional.  I wrote about that decision in an op-ed for TaxProf Blog.  The Supreme Court did not decide under section 2 whether states had to provide full-faith and credit to out-of-state marriages.  That secondary question was resolved today when the Supreme Court in a 5-4 decision held in Obergefell v. Hodges that the 14th Amendment of the Constitution guarantees a right to same-sex marriage.

I wrote an article for Slate in January predicting that the Supreme Court would rule in favor of same-sex marriage.  I based my theory on the tax consequences of ruling against same-sex marriage would have collateral damage.  “Couples that relied on their regional Circuit Court decisions for marriage recognition would no longer be married, and their marriages would not be recognized for federal income tax purposes. Under the current IRS ruling, they would not be treated as married in their state of domicile. Currently, without taking into account the pending 5th Circuit decision, this would mean residents of some 16 states would be affected.”

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June 26, 2015 in New Cases, Tax | Permalink | Comments (0)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

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June 26, 2015 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Weekly Student Tax Note Roundup

Gamage: Reflections On The King v. Burwell Decision

Gamage (2014)TaxProf Blog op-ed:  Reflections on the King v. Burwell Decision, by David Gamage (UC-Berkeley):

And, so, another judicial threat to Obamacare bites the dust.  Yesterday, the Supreme Court issued its decision in King v. Burwell, affirming that Obamacare’s premium tax credits are to be available in all States.  The 6-3 majority opinion written by Chief Justice Roberts concludes that the key statutory text is ambiguous.  To resolve this ambiguity, the majority looks to the Act’s context and structure, and decides for the government.

Crucial to the majority’s reasoning is that the term “Exchange” is defined by the statute as a term of art, and—as so defined—all Exchanges are explicitly deemed as being established by a State.  Although the statutory language is beyond inelegant and creates substantial ambiguity, it would be improper to ignore that “Exchange” is a defined term.  When a statute explicitly defines terms, this has always been understood to trump what might otherwise be the ordinary meaning of those terms.  I thus find the majority’s reasoning persuasive.  Indeed, I have been arguing along similar lines since this controversy first arose, and Darien Shanske and I previously co-authored an essay that made this argument in greater depth:  Why the Affordable Care Act Authorizes Tax Credits on the Federal Exchanges, 71 State Tax Notes 229 (2014).

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June 26, 2015 in New Cases, Scholarship, Tax | Permalink | Comments (4)

Winn: Law Students Can Disrupt The Market For High-Priced Textbooks By 'Naming And Shaming' Faculty Who Refuse To Use Free Open Access Books

NameJane K. Winn (University of Washington), Can Law Students Disrupt the Market for High-Priced Textbooks?, 10 Wash. J. L. Tech. & Arts ___ (2015):

The Center for Computer-Assisted Legal Instruction (CALI) is a non-profit organization whose mission is to advance legal education through technological innovation and collaboration. With its eLangdell Press project, CALI publishes American law school textbooks in open access, royalty-free form, offering faculty authors compensation equivalent to what most law school textbook authors would earn in royalties from a traditional full-price publisher. I am writing a new sales textbook and “agreements supplement” based on contemporary business practice that I will publish in open access form with CALI’s eLangdell Press. Relatively few other American legal academics publish in open access form, however, suggesting that the market for textbooks may be “locked-in” to a principal-agent conflict between students and faculty members. If American law students organized a website showing the textbook costs of all law faculty members at all law schools, they might be able to use a “naming and shaming” strategy to overcome faculty “lock-in” to high-priced textbooks and increase the adoption of open access textbooks.

Geier 4Deborah H. Geier (Cleveland State) has published a free eLangdell textbook, U.S. Federal Income Taxation of Individuals (CALI 2015):

As one, lone law professor, I have little direct ability to reduce tuition costs for my students. When writing this textbook, however, I decided to decline expressions of interest from the legacy legal publishers in favor of making this textbook available as a free download over the internet (in ePub format for iPads, Mobi format for Kindles, and pdf format for laptops), with an at-cost, print-on-demand alternative for those who like a hard copy. Fortunately, eLangdell (a division of CALI, the Center for Computer-Assisted Legal Instruction) has been an ideal partner in this regard.

In addition to eliminating (or lowering) student cost, this mode of publication will permit me to quickly and fully update the book each December, incorporating expiring provisions, inflation adjustments for the coming calendar year, new Treasury Regulations, etc., in time for use in the spring semester, an approach that avoids cumbersome new editions or annual supplements. This publication method also makes the textbook suitable for use as a free study aid for students whose professors adopt another textbook, as this textbook walks the student through the law with many more fact patterns and examples than do many other textbooks. While this practice adds length, I believe that it also makes the book more helpful to students in confronting what can be daunting material. Finally, having the textbook easily accessible to foreign students enrolled in a course examining the U.S. Federal income taxation of individuals is important to me, and having the textbook available as a free internet download succeeds well in that regard.

A Teacher’s Manual is available for professors who adopt the book (or parts of it) for use in their course.

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June 26, 2015 in Book Club, Legal Education, Scholarship, Tax | Permalink | Comments (4)

Rand Paul To Challenge The Constitutionality Of FATCA

FATCABloomberg, Rand Paul Said to Take on the IRS, Again:

Last week, Rand Paul said he wanted to blow up the tax code. Next week, he could be suing the tax man.

The Kentucky senator is expected to be one of the plaintiffs in a lawsuit against the Internal Revenue Service and the Treasury Department, challenging the government's rules on how Americans abroad are taxed and what foreign banks have to disclose about U.S. citizens who are their customers. Being on the wrong side of the IRS is, of course, a great place for a Republican presidential contender to be.

The focus of the lawsuit is the 2010 Foreign Account Tax Compliance Act—FATCA to the initiated—which has made it much harder for Americans to have foreign bank accounts hidden from the IRS. It's also been a logistical nightmare for the millions of Americans who live outside the country and are still required to file U.S. taxes. The law has also prompted some foreign banks to refuse U.S. customers rather than deal with the hassles.

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June 26, 2015 in IRS News, Tax | Permalink | Comments (0)

Pozen: Let's Cut Taxes By Reducing Tax Bias Favoring Debt Over Equity

Robert Pozen (Harvard), Let's Cut Taxes By Reducing Tax Bias:

Tax experts from around the world gathered two weeks ago in Washington DC to push forward a Euro-led project for the prevention of BEPS -- base erosion and profit shifting. This project is aimed at getting multinational companies to locate facilities and jobs in real countries, instead of post office boxes in tax havens.

The corporate tax rates in Europe are already 10% to 15% lower than the 35% rate in the U.S. If Europe moves forward with BEPS, that will put more pressure on US large companies to move people and plants abroad -- unless Congress substantially reduces the U.S. corporate tax rate.

While almost everyone wants to reduce the U.S. corporate tax from 35% to 25%, almost no industry is willing to give up its current tax preferences to achieve this rate reduction on a revenue neutral basis. This means that the national debt would not rise because revenues lost by rate reduction would be offset by revenues gained by restricting existing tax preferences.

Therefore, Congress should finance a substantial lowering of the U.S. corporate tax rate largely by reducing the tremendous bias in the current tax code for debt and against equity.

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June 26, 2015 in Tax | Permalink | Comments (1)