TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Tuesday, November 24, 2015

Fennell Presents The Distributive Deficit In Law And Economics Today At Columbia

Fennell (2015)Lee Anne Fennell (Chicago) presents The Distributive Deficit in Law and Economics, 100 Minn. L. Rev. ___ (2016) (with Richard H. McAdams (Chicago)), at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium Series hosted by Alex Raskolnikov and Wojciech Kopczuk:

Welfarist law and economics ignores the distributive consequences of legal rules to focus solely on efficiency, even though distribution unambiguously affects welfare, the normative maximand. The now-conventional justification for disregarding distribution is the claim of tax superiority: that the best means of influencing or correcting distribution is via tax-and-transfer. Critics have observed that optimal redistribution through tax may be politically infeasible, but have generally overlooked the rejoinder that the same political impediments to redistribution through tax will block redistribution through legal rules. This “invariance hypothesis,” as we label it, holds that there is only one distributive equilibrium and that Congress will offset through tax any deviations from it.

Continue reading

November 24, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Hillary Clinton's Growing Tax Agenda

Hillary 2016Wall Street Journal, Clinton’s Proposed Tax Credits Expand: Latest Focus on Caregivers Is at Least the Ninth Tax Proposal Since This Summer:

If you’re caring for an aging parent, deciding whether to invest in rural America or struggling to pay medical bills, Hillary Clinton has a tax credit for you.

As the Democratic presidential front-runner rolls out her policy agenda, she has repeatedly turned to the tax code as one of her favorite policy tools. It offers a way to reward behavior she wants to see more of, punish actions that she sees as harmful, and directly aid families with particular challenges.

Compared with outright spending programs, tax cuts can be simpler to administer, carefully targeted and politically easier to enact.

But there are downsides: They have a mixed record of success and often reward businesses for doing things they were going to do anyway. It can be complicated to claim the benefits. And the Internal Revenue Service, already sagging under budget cuts and the complex task of administering the Affordable Care Act, would be given even more work.

Continue reading

November 24, 2015 in Political News, Tax | Permalink | Comments (0)

It's Time To Drain The Bipartisan Tax Extender Feeding Trough

Extenders 2New York Times op-ed:  Giving Billions to the Rich, by Marc Short & Andy Koenig (Freedom Partners):

It's that time of year again, when Republicans and Democrats put aside their differences to dole out gifts of corporate welfare to a lucky few.

Congress will soon take up the so-called tax extenders package, which has more than 50 tax breaks affecting a variety of industries and issues. Lawmakers will undoubtedly spin this as a tax cut that will benefit hardworking Americans and improve our economy, but the reality is that this bill mostly helps the wealthy and the well connected.

Continue reading

November 24, 2015 in Tax | Permalink | Comments (0)

Bar Exam Carnage Spreads Across The Country

Following up on my recent posts (links below):  National Law Journal, Bar Exam Pass Rates Drop Across the Country:

Bar exam passage rates sank in several big states, indicating a drop in the qualifications of students amid fewer law school applications.

Pass rates in California, the District of Columbia, Florida, Georgia, New Jersey, New York and Pennsylvania all came in lower for the July 2015 exam.

“As demand for law schools has dropped over the last few years, law schools, as a result, have been admitting and graduating less-qualified students,” said Derek Muller, an associate professor at Pepperdine University School of Law in Malibu, California, who has studied and blogged about the issue.

Continue reading

November 24, 2015 in Legal Education | Permalink | Comments (0)

60% Of CalPERS' Private Equity Investments Contain Management Fee Waivers

Calpers 2Reuters, Majority of Calpers Private Equity Investments Contain Tax Deal:

The majority of deals signed by the California Public Employees' Retirement System with private equity firms allow the firms to reduce their tax bills by treating ordinary management fees as capital gains, an issue that is drawing increasing regulatory scrutiny.

At issue is what's known as a management fee waiver, in which private equity firms can waive the right to collect a management fee from an investor and instead accept the same amount of money as a capital contribution. The device allows the firms to decide themselves whether to treat their fees as ordinary income or as capital gains, which are taxed at lower rates.

Almost 60 percent of the $30.5 billion in private equity investments held by Calpers, the nation's largest public pension fund, contain the waivers.

Continue reading

November 24, 2015 in Tax | Permalink | Comments (1)

Three Blogs In Our Law Professor Blogs Network Chosen For ABA Blawg 100

Congratulations to our Law Professor Blogs Network bloggers recognized by the ABA Journal:Blawg 100

Blogs named to the 2015 ABA Blawg 100 ("the 100 best Web sites by lawyers, for lawyers, as chosen by the editors of the ABA Journal"):

  • EvidenceProf Blog, edited by Colin Miller (South Carolina).  ABA:  "Every weekday, law professors post on the very latest rulings regarding the admissibility of evidence in criminal cases and what sorts of lines of questioning should be permitted at criminal trials. They also note differences between the federal rules of evidence and the rules of various states. Occasionally, they will comment on whether they think courts have reached the right outcomes in these evidence cases or note fishy behavior by prosecutors."
  • Brian Leiter's Law School Reports, edited by Brian Leiter (Chicago).  ABA:  "This blog highlights academic job openings and covers salaries of professors, salaries of recent law school graduates, recent law review articles and other law school news. It can also be counted on to come up with its own rankings of law schools and law reviews."

Hall of Fame 2Blog named to the ABA Blawg 100 Hall of Fame:

  • Wills, Trusts & Estates Prof Blog, edited by Gerry W. Beyer (Texas Tech).  ABA:  "A loyal audience devours this blog seven days a week—and some readers have reported that trusted Texas Tech law professor Gerry W. Beyer will respond to them when they reach out. Beyer stays on top of new regulations in Texas ad nationwide as well as news and insights from both mainstream media and scholarly journals that affect those with estate planning and elder law practices."

Two other Law Professor Blogs Network blogs were inducted in the ABA Blawg 100 Hall of Fame in previous years:

Continue reading

November 24, 2015 in About This Blog, Legal Education, Tax | Permalink | Comments (0)

Manoj Viswanathan Joins UC-Hastings Tax Faculty

ViswanathanPress Release:

Viswanathan is currently a Visiting Assistant Professor and will co-teach UC Hastings' Business Tax Practicum for Social Enterprises, scheduled to start next semester. His research focuses on tax policy, economic development, and the regulation of tax-exempt organizations.

Prior to his arrival at UC Hastings, Viswanathan was a clinical teaching fellow and lecturer at Yale Law School, where he co-taught the Community and Economic Development clinic, and worked as a tax associate with Skadden, Arps, Slate, Meagher, & Flom LLP's New York City office.

He received his LLM and J.D. from New York University School of Law, and undergraduate and graduate degrees from the Massachusetts Institute of Technology. ...

Continue reading

November 24, 2015 in Legal Education, Tax, Tax Prof Moves | Permalink | Comments (0)

Pfizer-Allergan Merger Skirts New Anti-Inversion Rules, Sticks Shareholder With The Tax Bill

TIGTA: IRS Should Shift Definition Of Rich From $200k to $600k For Audits

TIGTAThe Treasury Inspector General for Tax Administration has released Improvements Are Needed in Resource Allocation and Management Controls for Audits of High-Income Taxpayers (2015-30-078):

Given the IRS’s goal of providing higher audit coverage to high-income taxpayers and its reduced operating budget, it is that much more important that the IRS selects audits that have the highest compliance impact.  However, it is not clear that the IRS audits the most productive high-income taxpayer cases or that it has a clear rationale for the inventory balance it has established among taxpayers at different TPI levels.

We conducted an analysis on Fiscal Year 2014 audit closures of high-income taxpayers comparing the number of audits to the number of tax returns filed in Calendar Year 2013 to evaluate the IRS’s audit coverage and audit productivity in the various TPI ranges.  Figure 5 shows that the IRS is providing increased audit coverage as a percentage of each TPI range as the high-income taxpayers’ TPIs increase.

Figure 5

Continue reading

November 24, 2015 in Gov't Reports, IRS News, Tax | Permalink | Comments (1)

The IRS Scandal, Day 929

IRS Logo 2Daily Caller, DOJ’s Lois Lerner Letter Leaves Much To Be Answered:

The Department of Justice’s (DOJ) explanation as to why top Internal Revenue Service (IRS) official Lois Lerner isn’t facing criminal charges leaves much to be desired.

After a two-year probe — which faced challenges due to Lerner’s crashed hard drive, the absence of email archives and the destruction of over 400 electronic backup tapes — the DOJ said it was unable to prove the IRS official “intentionally discriminated against an applicant based upon viewpoint” and cited line-employees’ “ignorance, inertia” and “negligence” for delays in Tea Party applications. Concerns raised by lawmakers over the course of the investigation were omitted from the department’s explanation. 

The DOJ’s letter failed to address whether investigators looked into who could have had access to Lerner’s private email account, which she sometimes used for official business — an issue members of the Ways and Means Committee asked to be investigated in a letter to Attorney General Eric Holder in April 2014.

Continue reading

November 24, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Monday, November 23, 2015

Brooks Presents The Troubling Role Of Tax Treaties Today At McGill

BrooksKim Brooks (Dalhousie University, Schulich School of Law) presents The Troubling Role of Tax Treaties (with Richard Krever (Monash University, Department of Business Law & Taxation)) at McGill today as part of its Spiegel Sohmer Tax Policy Colloquium Series:

The notional purpose of tax treaties is to prevent double taxation and tax evasion. The actual purpose is to reallocate taxing rights between an investor’s home jurisdiction (the residence state) and the host jurisdiction (the source state). The effect is to reduce or remove the taxing rights of a source state (a capital importing state) to leave more room for tax in the residence state (a capital exporting state). The revenue costs of agreeing to reduce taxing rights in a treaty are thought to be offset by other benefits. The benefits may be exaggerated. To the extent they may actually be realized, all can likely be achieved more efficiently through unilateral action by the source state.

November 23, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

2016 Business Tax Climate: Chilliest in Blue States

Tax Foundation logoThe Tax Foundation has released the 2016 State Business Tax Climate Index, which ranks the fifty states according to five indices: corporate tax, individual income tax, sales tax, unemployment insurance tax, and property tax. Here are the ten states with the best and worst business tax climates:






South Dakota














Rhode Island






New Hampshire










New York




New Jersey

Interestingly, all ten of the states with the worst business tax climates voted for Barack Obama in the 2012 presidential election, and seven of the ten states with the best business tax climates voted for Mitt Romney.

Tax Foundation

Continue reading

November 23, 2015 in Tax, Think Tank Reports | Permalink | Comments (2)

WSJ: Elizabeth Warren’s Tax Warning To Democrats

Warren 3Following up on Wednesday's post, Elizabeth Warren Delivers Major Speech Today On International Corporate Tax Reform: Wall Street Journal editorial, Elizabeth Warren’s Tax Warning: She Orders Democrats Not to Make the U.S. Tax Code More Competitive:

Sen. Elizabeth Warren (D., Mass.) must be getting nervous about the chances of tax reform for U.S. businesses. On Wednesday she fired a shot across the bow of any Democrat tempted to consider lowering the highest corporate income-tax rate in the industrialized world. By “any” we mean Sen. Chuck Schumer. The New York Democrat has flirted with the idea of making the U.S. economy more competitive.

Ms. Warren showed up at the National Press Club to pronounce that the idea that American companies are overtaxed is “not true.” In her prepared remarks she said the strategy of “giant corporations” is to “tell a story about high U.S. taxes, demand tax cuts from the U.S. Congress, and threaten to leave the U.S. for good if they don’t get what they want. I say it’s time to call their bluff.”

Call their bluff? Their bluff has been called. They’ve shown their cards. And they’ve moved overseas.

Continue reading

November 23, 2015 in Tax | Permalink | Comments (2)

Ending Segregation Of LGBTQ Students By Creating Barriers To 501(C)(3) Tax-Exempt Status

Jennifer Lunsford (Segar & Sciortino in Rochester, New York) & R. Zachary Sanzone, Outing the New Jim Crow: Ending Segregation of LGBTQ Students by Creating Barriers to 501(C)(3) Tax-Exemption Status, 23 Am. U. J. Gender Soc. Pol'y & L. 435 (2015):

Congress has broad taxation powers. As such, both the government and the citizenry have used the tax code throughout history to accomplish otherwise impossible goals. In the 1960s and 1970s, following the forced desegregation of public schools, private, religious schools began cropping up all over the country to provide a de facto segregated experience to white students. The legal obstacles that prevented the government from forcing these schools to accept black students are the same obstacles standing in the way of LGBTQ integration in similar schools today. To circumvent these legal obstacles the IRS issued Revenue Rule 71-447, which refused § 501(c)(3) tax-exempt status to private schools with racially discriminatory admission standards. Section 501(c)(3) status was vital to these schools as it allowed them to not only avoid tax burdens, but also encouraged monetary contributions from others by making donations tax deductible under § 170. This revenue rule effectively put a chokehold on the funding stream for private, religious schools that refused to accept non-white students, thereby forcing these schools to either integrate or close their doors. Implementing such a method today can help integrate LGBTQ students into the classroom community.

Continue reading

November 23, 2015 in Scholarship, Tax | Permalink | Comments (2)

Bottom 50% Earn 11% Of Income, Pay 3% Of Income Taxes; Top 1% Earn 19% Of Income, Pay 38% Of Income Taxes

Tax Foundation logoFollowing up on my previous post, Income Inequality Decreased Significantly in 2013:  Tax Foundation, Summary of the Latest Federal Income Tax Data, 2015 Update:

The Internal Revenue Service has recently released new data on individual income taxes for calendar year 2013, showing the number of taxpayers, adjusted gross income, and income tax shares by income percentiles. The data demonstrates that the U.S. individual income tax continues to be progressive, borne mainly by the highest income earners. ...

High-Income Americans Paid the Majority of Federal Taxes
In 2013, the bottom 50 percent of taxpayers (those with AGIs below $36,841) earned 11.49 percent of total AGI. This group of taxpayers paid approximately $34 billion in taxes, or 2.78 percent of all income taxes in 2013. In contrast, the top 1 percent of all taxpayers (taxpayers with AGIs of $428,713 and above), earned 19.04 percent of all AGI in 2013, but paid 37.80 percent of all federal income taxes.

In 2013, the top 1 percent of taxpayers accounted for more income taxes paid than the bottom 90 percent combined. The top 1 percent of taxpayers paid $465 billion, or 37.80 percent of all income taxes, while the bottom 90 percent paid $372 billion, or 30.20 percent of all income taxes.

Continue reading

November 23, 2015 in Tax, Think Tank Reports | Permalink | Comments (1)

Amidst 32% Enrollment Decline, Gonzaga Law School Offers Buyouts To All 17 Tenured Faculty (4 Accept)

Gonzaga LogoInlander, Why Gonzaga University School of Law Offered Buy-Outs to its Tenured Professors:

From 2011 to 2014, GU's School of Law has seen its application pool deplete by 36 percent. Enrollment has dropped by 28 percent in that same time.

As a result, the administration has offered buy-outs to all of its tenured professors. So far, four of the 17 faculty members have taken the offer. Law school dean Jane Korn does not anticipate the need to cut any more positions.

"Nationally, since 2011, applications to law schools have dropped around 40 percent," Korn says. "Every dean had to make a decision to lower standards or take a budget hit, and we decided to take the budget hit."

Continue reading

November 23, 2015 in Legal Education | Permalink | Comments (12)

Death Of Matthew Rosen, Co-Head Of Skadden's Tax Practice

RosenNew York Times Obituary (Nov. 20, 2015):

The partners, attorneys and staff of Skadden, Arps, Slate, Meagher & Flom mourn the passing of our partner and friend Matthew Rosen. A co-head of our tax practice, Matthew was a rare kind of lawyer -- one of the very finest tax practitioners of his generation and an unsurpassed mentor of the generations growing up under him. He led by example and will be remembered as always supporting new talent and the expansion of the practice into new spheres. Matthew joined our New York tax team in 1979 and, building upon the culture of camaraderie he inherited, enhanced the tightly knit group's reputation exponentially. Matthew handled every aspect of tax work and developed various types of financial instruments. He was repeatedly ranked among the top practitioners of his field.

Continue reading

November 23, 2015 in Obituaries, Tax | Permalink | Comments (0)

Harvard Law Students React To Vandalism On Portraits Of Black Law Profs

Harvard Crimson, Police Investigate Vandalism on Portraits of Black Law Professors, by Andrew M. Duehren :

Black tape, stuck systematically across the portraits of black law professors, spurred on Thursday a police investigation into vandalism and a pronouncement from the dean of Harvard Law School that the school has a “serious problem” with racism.

New York Times, A Lesson at Harvard Law, by Charles Fried (Harvard):

Instead of dignifying with inflated philosophical bloviation the grim nastiness of the anonymous vandal(s) who pasted strips of black tape on the portraits of African-American professors, Harvard Law students responded with wit and human warmth: They put along the frames of those same portraits hundreds of colored Post-it notes bearing messages of affection and gratitude.

These young men and women teach us all a valuable lesson.

Harvard Crimson, Supportive Sticky Notes After Law School Vandalism, by Jennifer Y. Yao:

Harvard 2

Continue reading

November 23, 2015 in Legal Education | Permalink | Comments (3)

The IRS Scandal, Day 928

IRS Logo 2Leader & Times, Koskinen Needs to be Impeached, So Does Lynch and Numerous Others:

IRS Commissioner John Koskinen is in the sights of Rep. Jason Chaffetz, who is chairman of the powerful House Oversight Committee, which has been investigating the IRS for more than two years. Chaffetz said Koskinen has failed to comply with a congressional subpoena, allowed documents to be destroyed and misled the public.

The committee’s call for impeachment falls on the heels of a report from the U.S. Justice Department that said it “found no evidence that Lois Lerner or any IRS official acted based on political, discriminatory, corrupt or other inappropriate motives that would support a criminal prosecution.”

What a crock.

Continue reading

November 23, 2015 in IRS Scandal | Permalink | Comments (3)

TaxProf Blog Weekend Roundup

Sunday, November 22, 2015

Prof Sues Dean, Law School For Access To Admissions Data

UALRArkansas Online, Law School Violates Open-Records Act, Suit Says:

The man helping to write a book on the state Freedom of Information Act says the dean of the University of Arkansas at Little Rock law school is not complying with the open-records law in a lawsuit filed against the university Tuesday.

Law professor Robert Steinbuch sued both the university and Michael Schwartz, dean of the William H. Bowen School of Law, in a Pulaski County court, stating Schwartz failed to turn over public records that Steinbuch is seeking to research student admissions.

The records are a spreadsheet showing individual test scores, college grade-point average, law school grade-point average, race, gender and age for all students who graduated from the law school and took the bar exam over a seven-year period.

Continue reading

November 22, 2015 in Legal Education | Permalink | Comments (0)

Choose To Be Grateful. It Will Make You Happier.

GratefulNew York Times Sunday Review:  Choose to Be Grateful. It Will Make You Happier, by Arthur C. Brooks (President, American Enterprise Institute):

For many people, gratitude is difficult, because life is difficult. Even beyond deprivation and depression, there are many ordinary circumstances in which gratitude doesn’t come easily. This point will elicit a knowing, mirthless chuckle from readers whose Thanksgiving dinners are usually ruined by a drunk uncle who always needs to share his political views. Thanks for nothing.

Beyond rotten circumstances, some people are just naturally more grateful than others. A 2014 article in the journal Social Cognitive and Affective Neuroscience identified a variation in a gene (CD38) associated with gratitude. Some people simply have a heightened genetic tendency to experience, in the researchers’ words, “global relationship satisfaction, perceived partner responsiveness and positive emotions (particularly love).” That is, those relentlessly positive people you know who seem grateful all the time may simply be mutants.

But we are more than slaves to our feelings, circumstances and genes. Evidence suggests that we can actively choose to practice gratitude — and that doing so raises our happiness. ...

Continue reading

November 22, 2015 in Legal Education, Tax | Permalink | Comments (3)

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. [403 Downloads]  Income Tax Deductions for Charitable Bequests of IRD, by Christopher R. Hoyt (UMKC)
  2. [360 Downloads]  Big Data and Tax Haven Secrecy, by Arthur J. Cockfield (Queen's University)
  3. [311 Downloads]  2014 Developments in Connecticut Estate and Probate Law, by Jeffrey A. Cooper (Quinnipiac) & John R. Ivimey (Reid and Riege, Hartford)
  4. [223 Downloads]  Too Big to Tax? Vanguard and the Arm’s Length Standard, by Reuven Avi-Yonah (Michigan)
  5. [199 Downloads]  2015 Trying Times: Important Lessons to Be Learned from Recent Federal Tax Cases, by Nancy A. McLaughlin (Utah) & Steven J. Small (Law Office of Stephen J. Small, Newton, MA)

November 22, 2015 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

50% Of Law Grads Who Failed California Bar Would Have Passed In A Different State

CaliforniaDerek Muller (Pepperdine), California Bar Exam Takers Are Far More Able Than Others Nationwide But Fail at Much Higher Rates:

The California July 2015 bar results were recently released, reflecting a modest drop in scores, slightly less than other jurisdictions this year. The overall pass rate dropped from 48.6% in July 2014 to 46.6%. The first-time pass rate dropped from 61% to 60%. And among California ABA-accredited schools, the first time rate also dropped a point to 68%.

California is one of the rare jurisdictions that also discloses its statewide mean scaled MBE score. The NCBE discloses the nationwide mean scaled MBE score, which has dropped fairly significantly over the last couple of years. But California has consistently outperformed the nationwide cohort, sometimes rather dramatically. ...

Continue reading

November 22, 2015 in Legal Education | Permalink | Comments (2)

Remand: Pepperdine Law School's Global Justice Program In Uganda

My wife and I spent a wonderful Saturday night in Santa Monica, having dinner with some bigwigs and watching a preview of the forthcoming documentary Remand, detailing Pepperdine Law School's work in reforming Uganda's criminal justice system.


Watch the trailer:

Continue reading

November 22, 2015 | Permalink | Comments (0)

The IRS Scandal, Day 927

IRS Logo 2The Blaze, Legal Experts: ‘Utterly Irresponsible’ Not to Conduct IRS Impeachment Probe:

While bringing impeachment charges against Internal Revenue Service Commissioner John Koskinen could seem an audacious move, some constitutional law experts believe it’s the only responsible step for members of Congress to take.

“Impeachment is a remedy to deal with grave offense in the abuse of office — whether or not someone committed private wrongs that warrant being put in jail,” Andrew McCarthy, former chief assistant U.S. attorney in New York, told TheBlaze. “If there have been abuses of power committed by public officials, it would be irresponsible to leave them there.” ...

“Impeachment is one of the few checks the legislature has on executive power. High crimes and misdemeanors don’t have to be felonies,” John Eastman, a law professor and director of the Center for Constitutional Jurisprudence at Chapman University. “When a public official won’t comply with the law, it is the only option left. If Congress doesn’t conduct proper oversight, they are part of the problem.” ...

Though Koskinen was not involved in the targeting scandal itself, his actions likely prevented the truth from surfacing, said David Rivkin, who formerly served as a deputy director in the Reagan Justice Department and as a legal adviser in White House Counsel’s office

“He didn’t cause this, but just as prosecutors bring a case to send a message, this could be done to make a point,” Rivkin, now a partner at the Washington law firm Baker Hostetler LLP., told TheBlaze. “There is a broader narrative in the context of how this administration has violated separation of powers.”

Rivkin said that the purpose of impeachment is not to punish — or even fire — a public official. Rather, it’s to protect the public trust. “If Congress does nothing, it is de facto approval,” Rivkin said. “It would be utterly iresponsible and utterly dangerous to civil liberties and the balance of powers for the House to do nothing.”

Continue reading

November 22, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Saturday, November 21, 2015

This Week's Ten Most Popular TaxProf Blog Posts

Dexter Presents A Tax Expenditure Approach to Reparations Today At Duke

DexterBobby Dexter (Chapman) presents The Hate Exclusion: Moral Tax Equity for Damages Received on Account of Race, Sex, or Sexual Orientation Discrimination, 13 Pitt. Tax Rev. ____ (2016), at the Duke Law School Center on Law, Race and Politics conference today on The Present and Future of Civil Rights Movements:  Race and Reform in 21st Century America:

Scholars on both sides of the reparations literature divide commonly contemplate some form of federal monetary outlay.  At the same time, given both the absence of such an outlay and the dire prognosis that such largesse is forthcoming, tax scholars rarely contribute to traditional reparations literature.  With this Article, Professor Dexter introduces the notion that reparations take the form of narrowly-tailored federal tax expenditures.

Continue reading

November 21, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (1)

NTA 108th Annual Conference on Taxation

Cover2The three-day National Tax Association 108th Annual Conference on Taxation concludes today in Boston.  Today's highlights:

Fiscal Federalism, Multilateralism, and Tax Law Design

  • Session Chair:  Daniel Shaviro (NYU)
  • Daniel Schaffa (Michigan), Federal Collection of State Individual Income Taxes
  • Eric Kades (William & Mary), Corrective Progressivity
  • David Gamage (UC-Berkeley) & Darien Shanske (UC-Davis), Fiscal Federalism from the Subnational Government Perspective: Tax Reform for the U.S. States
  • Itai Grinberg (Georgetown), The New International Tax Diplomacy
  • Discussants:  Brian Galle (Georgetown), Daniel Shaviro (NYU)

Tax Forms, Publications, and Compliance

  • Session Chair:  Leigh Osofsky (Miami)
  • Kathleen Thomas (North Carolina), User-friendly Taxpaying
  • Leigh Osofsky (Miami) & Joshua Blank (NYU), Simplexity and the Tax Law
  • Samara Gunter (Colby College), Your Biggest Refund, Guaranteed? Tax Filing Method and Reported Tax Liability
  • Joseph Bankman (Stanford), Using the ‘Smart Return’ to Reduce Tax Evasion
  • Discussants:  Larry Zelenak (Duke), Kristin Hickman (Minnesota)

Continue reading

November 21, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 926

IRS Logo 2Wisconsin State Journal, GAB Chief Inquired with IRS About Campaign Coordination:

The head of the Government Accountability Board was told in early 2013 by a top Internal Revenue Service official — who later resigned amid controversy — that the IRS's criminal division might investigate the type of coordination at the heart of a now-halted John Doe investigation, according to testimony released Friday.

Government Accountability Board executive director Kevin Kennedy testified in an ongoing lawsuit that he inquired with Lois Lerner, a personal friend and head of the IRS division overseeing tax-exempt organizations, in general terms about coordination between a non-profit organization and a political campaign.

"If you have facts that show that a candidate and candidate's campaign director are engaging in these kind of communications and these are the activities that are being directed, does this seem like it might be something that might be an issue with the IRS?" Kennedy said, recalling what he asked Lerner. "Her response was, 'Yes, but that would probably be criminal, and I wouldn't have much to do with that other than making sure the paperwork got over to the other side.'"

Such coordination between Gov. Scott Walker's campaign and the Wisconsin Club for Growth was the focal point of a John Doe investigation that the Wisconsin Supreme Court halted in July saying the case had no basis in law.

Continue reading

November 21, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Friday, November 20, 2015

Law School Rankings By New BigLaw Partners

Following up on my previous posts on law school rankings by the number of BigLaw Partners by Ted Seto (Loyola-L.A.), Rob Anderson (Pepperdine), and Edward Adams (Minnesota) (NY Times coverage):  Bloomberg BNA, The Law Schools New Big Law Partners Attended:

How much weight does a prestigious law degree hold when it comes to climbing the ranks at a large law firm? ...

Over the past several months, a number of law firms have announced new classes of partners for the upcoming year, and we thought it would be a fruitful exercise to take a look at who these lawyers are and where they come from. ... Big Law Business reviewed the legal education of 299 lawyers who were elected partners at AmLaw 100 and 200 firms, effective between Oct. 1 and Jan. 2016.

Here are the Top 31 law schools:

1.     Harvard:  21 new partners
2.     NYU:  15
3.     Michigan:  10
4.     Georgetown, Northwestern:  9
6.     Virginia:  8
7.     Chicago, Columbia, UC-Berkeley:  7
10.   Boston College:  6
11.   Boston University, Fordham, George Washington, Illinois, UCLA, Vanderbilt:  5
17.   American, Brooklyn, Cardozo, Case Western, Penn, Stanford, St. Louis, Texas, USC, Yale:  4
27.   Chicago-Kent, Georgia, Notre Dame, San Diego, Tennessee:  3

Continue reading

November 20, 2015 in Law School Rankings, Legal Education | Permalink | Comments (1)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

Continue reading

November 20, 2015 in Scholarship, Tax | Permalink | Comments (0)

Women, African-American Lawyers Make Little Progress At Big Law Firms

NALP New LogoNALP, Women, Black/African-American Associates Lose Ground at Major U.S. Law Firms:

Women and Black/African-Americans show declines in representation at major U.S. law firms, according to the latest law firm demographic findings from the National Association for Law Placement (NALP). NALP's recent analyses of the 2015-2016 NALP Directory of Legal Employers (NDLE) — the annual compendium of legal employer data published by NALP — shows that although women and minorities continue to make small gains in their representation among law firm partners in 2015, the overall percentage of women associates has decreased over the majority of the last five years, and the percentage of African-American associates has declined each year since 2009. 

New York Times:  Women and Blacks Make Little Progress at Big Law Firms, by Elizabeth Olson:

Continue reading

November 20, 2015 in Legal Education | Permalink | Comments (1)

Treasury, IRS Issue New Rules To Curb Tax Inversions

Florida Coastal Law Grad Seeks Supreme Court's Help To Discharge $260,000 Student Loan Debt In Bankruptcy

Florida CoastalFollowing up on my previous post, 7th Circuit: Florida Coastal Law Grad Cannot Discharge $260,000 Student Loan Debt In Bankruptcy: Patrick Gregory (Bloomberg BNA), Law School Debt, 'Hopelessness' and the Supreme Court:

Mark Tetzlaff has close to $300,000 in law school debt and is seeking the U.S. Supreme Court’s help in getting it discharged in bankruptcy (Tetzlaff v. Educ. Credit Mgmt. Corp., petition for cert. filed, 84 U.S.L.W. 3222 (U.S. Oct. 15, 2015) (No. 15-485)).

Courts including the U.S. Courts of Appeals for the Seventh and Eighth circuits are split on what constitutes “undue hardship” that makes a debtor eligible for such a discharge. The U.S. Court of Appeals for the First Circuit is also considering this issue.

Tetzlaff has fallen on hard times, James M. Wilton of Ropes & Gray LLP, Boston, who represents Tetzlaff, told Bloomberg BNA. He has massive debt and is “10 years from retirement age,” Wilton said.

The issue of law school debt has been getting more attention recently. Lawmakers on both sides of the aisle have “sharply criticized U.S. law schools” for burdening students with crushing debt and non-marketable degrees, according to Bloomberg Business.

Continue reading

November 20, 2015 in Legal Education | Permalink | Comments (5)

NTA 108th Annual Conference on Taxation

Cover2The three-day National Tax Association 108th Annual Conference on Taxation continues today in Boston.  Today's highlights:

International Corporate Tax Policy

U.S. Wealth Inequality Measurement

Continue reading

November 20, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Wake Forest Symposium: Revisiting Langdell — Legal Education Reform And The Lawyer’s Craft

Wake 4Wake Forest Law Review Symposium, Revisiting Langdell: Legal Education Reform and the Lawyer’s Craft:

Embracing the inseparability of legal doctrine and legal practice sheds much light on the lawyer’s craft, on useful law school curriculum reform, and on what the bar might reasonably expect from law schools. Through this unified lens, the Symposium will look beyond Langdell’s “Socratic” method focused on redacted appellate cases and will explore a richer theoretical understanding of legal education and scholarship and the lawyer’s craft. To paraphrase Kant, the Symposium will explore how doctrine without practice is empty, how practice without doctrine is blind, and how, as a correlate of this separate emptiness and blindness, the humanities play a critical role in law and legal education and scholarship.

The Symposium will expand upon Harold Lloyd (Wake Forest), Exercising Common Sense, Exorcising Langdell: The Inseparability of Legal Theory, Practice and the Humanities, 49 Wake Forest L. Rev. 1213 (2014).

Continue reading

November 20, 2015 in Legal Education, Scholarship | Permalink | Comments (1)

The IRS Scandal, Day 925

IRS Logo 2WND, IRS Target: 'Justice in Their Hands Is a Mockery':

On Friday, [Oct. 23,] the Justice Department announced it was closing its investigation of former IRS official Lois Lerner and would not be filing any charges, chalking up the scandal instead to mismanagement.

However, the head of one of the grassroots organizations that endured unwarranted scrutiny by the IRS says the decision is simply more proof of a “lawless administration” that is making a “mockery” of justice. ...

True the Vote is one group that endured years of IRS harassment over its application for tax-exempt status. Its president, Catherine Englebrecht, is disgusted but not surprised by the Justice Department’s announcement.

“This is a lawless administration,” she said in an interview with WND and Radio America. “They write the rules and then play by those if they choose to follow. It is certainly not a surprise at all that they’ve chosen to try to wipe the slate clean of the IRS scandal, as they have so many other scandals. They don’t look to police themselves. They’re not interested in the better interests of their fellow countrymen. They’re interested in the survival of their party.”

Continue reading

November 20, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Thursday, November 19, 2015

Osofsky Reviews Oh's Will Tax Reform Be Stable?

JotwellLeigh Osofsky (Miami), A New Tax Policy Criterion: Stability (Jotwell) (reviewing Jason Oh (UCLA), Will Tax Reform Be Stable?):

Fairness, efficiency, simplicity, and revenue-raising capability (not necessarily in that order) have long been the hallmarks of good tax policy. In a forthcoming article, Will Tax Reform Be Stable?, Jason Oh introduces a new criterion: stability. Oh persuasively argues that certain tax reform may be more or less stable than others, and contends that it is possible to analyze and predict stability. Moreover, as Oh explains, understanding stability is essential in order to determine the durability of any good (or bad) tax reform.

Continue reading

November 19, 2015 in Scholarship, Tax | Permalink | Comments (1)

Pittsburgh Tax Review Publishes New Issue

Pittsburgh Tax Review (2015)The Pittsburgh Tax Review has published Vol., 12, No. 2 (Spring 2015):

Continue reading

November 19, 2015 in Scholarship, Tax | Permalink | Comments (0)

$23 Billion In Annual Federal Tax Credits For Higher Education Have No Effect On College Attendance

NBER, Who Benefits From Federal Tax Credits For Higher Education?:

Researchers find that tax credits for higher education have little or no effect on college attendance; the credits are essentially transfer payments - and not primarily to the needy.

In 2014, the federal government spent about $23 billion on three programs offering tax credits to households paying for higher education. In The Returns to the Federal Tax Credits for Higher Education (NBER Working Paper No. 20833), George B. Bulman [UC-Santa Cruz] and Caroline M. Hoxby [Stanford] find that the credits have little or no effect on college-going in the U.S. The credits do not affect whether students enroll at all, whether they attend four-year colleges, how expensive their colleges are, or the scholarships and grants they receive. The authors conclude that the tax credits are primarily "a transfer from some individuals to others." ...

Continue reading

November 19, 2015 in Legal Education, Scholarship, Tax | Permalink | Comments (0)

McMahon: Gendering the Marriage Penalty

InfantiStephanie Hunter McMahon (Cincinnati), Gendering the Marriage Penalty, in Controversies in Tax Law: A Matter of Perspective (Anthony C. Infanti, ed. Ashgate 2015):

In 1969 Congress amended the Internal Revenue Code to create a marriage penalty. The penalty was not felt by all married couples: Only those couples in which spouses earned roughly equal amounts and who filed joint tax returns paid a penalty. Thus, the 1969 change in law had a gendered effect of discouraging some wives from earning income, but the alternative was not without its own gendered results. If gender marks the impact of the 1969 legislation, was gender what motivated the change in law? It would be easy to assume that at the end of the 1960s, a socially conservative legislature reacted to a developing women’s movement. From the legislative debates, sexism certainly pervaded congressional discussion of women’s role in the family and the economy. However, this only tells part of the story and does so by focusing on the result that remains of interest today. Economic forces were a larger part of the story.

Continue reading

November 19, 2015 in Scholarship, Tax | Permalink | Comments (0)

NY Court: Ethics Rules Bar Whistleblower Suit By Former Vanguard Tax Lawyer Alleging Mutual Fund Giant Evaded $1 Billion in Taxes

VanguardFollowing up on my previous posts (links below): Philadelphia Inquirer, Danon Barred From Whistleblower's Cut in Vanguard NY Case:

A New York State Supreme Court justice has ruled that a former Vanguard Group tax lawyer cannot expect to collect a whistleblower's cut of potential back state taxes owed by the mutual-fund giant because he was employed by Vanguard at the time he secretly filed the complaint.

Continue reading

November 19, 2015 in New Cases, Tax | Permalink | Comments (0)

NTA 108th Annual Conference on Taxation

Cover2The three-day National Tax Association 108th Annual Conference on Taxation kicks off today in Boston.  Today's highlights:

Alan Auerbach (UC-Berkeley), Presidential Address

Topics in Business Taxation:

  • Session Chair:  Diane Ring (Boston College)
  • Mirit Eyal-Cohen (Alabama), Taxing Economies of Scale
  • Shu-Yi Oei (Tulane) &  Diane Ring (Boston College), Regulation by Crowd
  • David Hasen (Colorado), Taxation and Innovation
  • Jacob Nussim (Bar-Ilan), Taxation and Innovation
  • Discussants:  Shu-Yi Oei (Tulane), Diane Ring (Boston College), Jacob Nussim (Bar-Ilan)

Charitable Giving of High-Income Households

  • Session Chair:  Jon Bakija (Williams)
  • Brian Galle (Georgetown), Law and the Problem of Restricted Spending Philanthropy
  • Brian Galle (Georgetown) & Benjamin Marx (Illinois), Do Private Foundation Donors Care About State Law?
  • Nicolas Duquette (USC), Philanthropy, Inequality, and the Income Tax: High-Income Households’ Charitable Giving 1917–2012
  • Jon Bakija (Williams) & Brian Raub (IRS), How Estate Taxation Affects Charitable Donations and Wealth Accumulation: Evidence from the Divergence in Estate Tax Rates across States After 2001
  • Discussants:  Yair Listokin (Yale), Chistine Exley (Harvard)

Continue reading

November 19, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Chicago-Kent Symposium: Nonprofit Oversight Under Siege

Chicago-KentChicago-Kent hosts a symposium today on Nonprofit Oversight Under Siege:

The View from the U.S.:

  • Evelyn Brody (Chicago-Kent) & Marcus Owens (Loeb & Loeb, Washington, D.C.), Exile to Main Street: The I.R.S.’s Diminished Role in Overseeing Tax-Exempt Organizations 
  • Linda Sugin (Fordham), Politics, Disclosure, and State Law Solutions for 501(c)(4) Organizations
  • Lloyd Hitoshi Mayer (Notre Dame), Fragmented Oversight of Nonprofits in the United States: Does It Work? Can It Work?

Continue reading

November 19, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Inaugural International Conference on Taxpayer Rights Concludes Today In Washington, D.C.


The two-day inaugural International Conference on Taxpayer Rights concludes today in Washington, D.C. (agenda):

The National Taxpayer Advocate of the Internal Revenue Service is convening the Inaugural International Conference on Taxpayer Rights in Washington, D.C. This ground-breaking conference will present panelists from around the world to explore how taxpayer rights globally serve as the foundation for effective tax administration.

Today's speakers include:

Continue reading

November 19, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

Clausing: The Effect Of Profit Shifting On The Corporate Tax Base In The U.S. And Beyond

Kimberly A. Clausing (Reed College), The Effect of Profit Shifting on the Corporate Tax Base in the United States and Beyond:

This paper estimates the effect of profit shifting on corporate tax base erosion for the United States. Using Bureau of Economic Analysis survey data on U.S. multinational corporations over the period 1983 to 2012, the analysis estimates the sensitivity of foreign incomes to tax burdens for major foreign direct investment destinations. Controlling for a host of other variables as well as country fixed effects, I find that taxable income is very sensitive to corporate tax rates. Estimates of tax sensitivity are used together with data on reported foreign income to calculate how much “extra” income is booked in low-tax countries due to profit shifting;

Continue reading

November 19, 2015 in Scholarship, Tax | Permalink | Comments (1)

The IRS Scandal, Day 924

IRS Logo 2Family Security Matters, Why Lois Lerner and the IRS Scandal Are Not Unique:

Bottom Line Up Front:  Political appointees run the nation's bureaucracies.  Former political appointees who are "burrowed" into the system bolster political ideology and decisions.  Furthermore, those who are hired and promoted by the appointee and/or former appointee in charge of an organization are most probably of similar political ilk.

The IRS scandal was felt heavily by those of us who are retired from federal service.  After having spent decades within the bowels of federal bureaucracies - decades that, for us, were not defined at all by politics - the intentional targeting of Americans of ANY political persuasion came as a horrific shock. 

In our day, civil servants would NEVER have targeted political opponents of the ruling administration. Even if a rogue employee had tried, such actions would never have been tolerated.  Warnings against any defiance of the limitations imposed by the Hatch Act of 1939 kept virtually all civil servants from holding much more than personal political opinions expressed only in private.  Politics were certainly not discussed in the office, let alone acted upon.  Until recently, federal employees were decidedly "non-partisan."

The evidence surrounding the Lois Lerner case has shown us how different our government has become. The initial shock that came with revelations of the extent to which government officials within the IRS had been able to intervene in and delay the processing of specific tax-exempt requests (virtually all of which were from conservative organizations) gave way to outrage following testimony to Congress about the "loss" of emails and other files pertinent to the investigation.  When combined with the disreputable conduct associated with the VA, ATF, EPA, DoE, DoD, GSA, and the highest levels of the State Department, is it any wonder that Americans feel exasperated and retired federal workers feel estranged from the very government they had so long served? 

Question:  What has changed?  Answer:  The manner in which political appointees are filtered into the bureaucracies. ...

This is yet another dilemma that the next President will inherit.  If the process does indeed encourage institutionalized political bias, something must be done about it.  Hopefully the next administration will find a way to end the overt expression of bias by employees who see themselves as political avengers, and terminate the practice that gave us the IRS scandal.

Continue reading

November 19, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (10)