TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Monday, November 16, 2015

The IRS Scandal, Day 921

IRS Logo 2The Press Enterprise editorial, IRS Scandal Does No Harm to Ruling Party, So No Foul:

Self-government can collapse when government doesn’t police itself — when abuses of power fester too long. That has happened with the investigation into the Internal Revenue Service’s unjustified 2010 audits of numerous nonprofit conservative groups, which sidelined many of them during President Obama’s 2011-12 re-election campaign.

In a letter to Congress, the Justice Deparment said it will file no criminal charges in the case, not even against Lois Lerner, the former director of the IRS’s Exempt Organizations Office. Yet in 2013, Ms. Lerner herself sparked the uproar, telling an American Bar Association meeting that IRS auditors “actually used case names on this list. They used names like Tea Party or Patriots, and they selected cases simply because the applications had those names in the title.”

Before a congressional investigation, Ms. Lerner invoked her Fifth Amendment right against self-incrimination.

Former House Oversight Committee Chairman Darrell Issa, R-Vista, conducted one of the investigations. He said in a statement, “The Justice Department's decision to close the IRS targeting investigation without a single charge or prosecution is a low point of accountability in an administration that is better known for punishing whistleblowers than the abuse and misconduct they expose.” He charged, “Giving Lois Lerner a free pass only reinforces the idea that government officials are above the law and that there is no consequence for wrongdoing.”

With the 2016 elections approaching, restoring clean, honest government should be voters’ top priority.

Continue reading

November 16, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

TaxProf Blog Weekend Roundup

Sunday, November 15, 2015

L.A. Times: Deans Of Some California Law Schools Say Low LSAT Scores Do Not Predict Bar Exam Failure

CaliforniaLos Angeles Times, As Fewer Californians Pass the Bar, Are LSAT Scores an Early Indicator of Success?:

Already faced with one of the lowest bar passage rates in the country, California students and academics shouldn't expect those statistics to improve over the next several years, according to a new study that examines the link between standardized test scores and bar passage rates.

In July 2014, only 48.6% of test-takers passed the California bar; nearly 8,500 took it. Historically, the state has one of the hardest to pass bar exams in the nation, but last summer was the first time in almost a decade that the success rate fell below half.

"It's not going to get better," said Kyle McEntee, executive director of Law School Transparency, the advocacy group that conducted the study. "If anything, it's going to get worse."

Research has found that the LSAT is a key predictor of bar performance. But some school administrators dispute those findings, saying results on the 180-point LSAT don't necessarily indicate success on the bar.

McEntee is pessimistic because the number of California schools that admit a high number of students who scored below 150 on their law school admission test is growing.

Eight [California Western, Golden Gate, La Verne, McGeorge, Southwestern, Thomas Jefferson, Western State, Wittier] out of California's 21 law schools have recently admitted classes that have a "high," "very high" or "extreme" number of students who have a poor chance of passing the bar, based on their LSAT scores, the study showed.

Chart 5

Continue reading

November 15, 2015 | Permalink | Comments (16)

The Top 5 Tax Paper Downloads

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

  1.  [384 Downloads]  Income Tax Deductions for Charitable Bequests of IRD, by Christopher R. Hoyt (UMKC)
  2.  [336 Downloads]  Big Data and Tax Haven Secrecy, by Arthur J. Cockfield (Queen's University)
  3.  [306 Downloads]  2014 Developments in Connecticut Estate and Probate Law, by Jeffrey A. Cooper (Quinnipiac) & John R. Ivimey (Reid and Riege, Hartford)
  4.  [204 Downloads]  Too Big to Tax? Vanguard and the Arm’s Length Standard, by Reuven Avi-Yonah (Michigan)
  5.  [173 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 15, 2015 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

The Temptation Of Baylor: Can Faith And Football Coexist?

BaylorInside Higher Ed, The Temptation of Baylor:

Baylor University has one of the top football teams in the country. It's also the world's largest Baptist university. Can the two identities coexist without serious compromise?

Continue reading

November 15, 2015 in Legal Education | Permalink | Comments (4)

The IRS Scandal, Day 920

IRS Logo 2Harrison Daily editorial, Why Is No One Held Accountable?:

Never ever does anything serious seem to happen to government officials who fail to do their jobs properly, waste massive amounts of taxpayers' money, harm the innocent unfairly or even engage in criminal activities. It is happening again in the Internal Revenue Service scandal.

IRS officials in the section headed by Lois Lerner singled out conservative groups seeking tax-exempt status for special treatment. It included lengthy delays and sometimes, outright harassment.

Lerner herself was allowed to retire from the IRS — after refusing to testify at two congressional hearings. Then, investigators were told some of her official emails pertinent to the probe had been lost when her computer crashed, ever so conveniently.

Recently, the Justice Department announced it had concluded an investigation of the matter — and would be filing criminal charges against no one.

DOJ officials admitted they found "mismanagement, poor judgment and institutional inertia" that contributed to the IRS problem.

No one has received any substantial punishment for what happened. Lerner will enjoy her full pension. Those she left behind will continue to cruise through the IRS bureaucracy until they, too, retire.

Nowhere in the government — not at the IRS, the Department of Veterans Affairs, the Environmental Protection Agency or any of the other places where actions demand accountability has it occurred.

Why? More important, why does no one in Congress do anything about it?

Continue reading

November 15, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Saturday, November 14, 2015

This Week's Ten Most Popular TaxProf Blog Posts

WSJ: Value-Added Tax Catches On In Republican Presidential Race

VATWall Street Journal, Value-Added Tax Catches On in Republican Presidential Race:

This year’s crop of Republican presidential candidates has pitched many ways to bust up the tax code, but one idea—converting to a value-added tax—has been anathema to both parties for decades despite being a staple worldwide.

Sens. Rand Paul of Kentucky and Ted Cruz of Texas want to replace the 78-year-old payroll tax, which is now dedicated to Social Security and Medicare, and the 106-year-old corporate income tax with a single levy. That new tax would be so big and broad-based that Mr. Cruz’s version would raise $25.4 trillion over the next decade and would become the federal government’s primary funding source, raising more than a reduced individual income tax.

Their proposals have drawn scant attention on the campaign trail, and are hardly revolutionary globally, as the U.S. is the only developed country without a value-added tax.

But some conservative critics are beginning to raise alarms. Adopting a broad tax on goods and services, they say, would make the sting of taxation less palpable and—eventually—let the U.S. adopt the revenue system that fuels the European social-welfare states.

Continue reading

November 14, 2015 in Political News, Tax | Permalink | Comments (2)

NY Times: The Four Secrets To Sustaining High Job Performance

TonyNew York Times, The Secret to Sustaining High Job Performance, by Tony Schwartz (Author, The Way We're Working Isn't Working: The Four Forgotten Needs That Energize Great Performance):

How do you drive sustainably high performance in an era of relentlessly rising demand? ...

The typical solution – put in more hours – won’t work anymore. The vast majority of salaried employees are already doing that, and many of them are paying a price that they are finding less and less acceptable. They are exhausted and often overwhelmed, and they deeply want to invest time in their families and the rest of their lives.

But what if people could simply be more efficient and productive during the time they are at work? What if there’s a win-win solution for employers and employees? ...

We feel better and perform better when four core energy needs are met: sufficient rest, including the opportunity for intermittent renewal during the work day; feeling valued and appreciated; having the freedom to focus in an absorbed way on the highest priorities; and feeling connected to a mission or a cause greater than ourselves.

Continue reading

November 14, 2015 in Book Club, Legal Education, Tax | Permalink | Comments (0)

The IRS Scandal, Day 919

IRS Logo 2The Hill:  IRS Problems Extend Far Beyond its Commissioner, by Brandon Arnold (National Taxpayers Union):

Frustrations with the IRS have reached a boiling point, with a group of House Republicans now calling for the impeachment of IRS Commissioner John Koskinen. His ouster is probably well-deserved -- there is evidence to suggest that he misled Congress while under oath and may have broken other laws along the way.  While firing him might be prudent, the real problems with the IRS can’t be fixed by changing personnel. Congress can oust as many commissioners as it wants, but until the fundamental flaws at the increasingly roguish agency are fixed, individuals, families, businesses and non-profit groups will continue to be mistreated.

Consider for instance, the political targeting of groups categorized as non-profits under the Internal Revenue Code. It’s now clear that the IRS selectively harassed organizations for their ideological orientations, which were overwhelmingly conservative. This inconvenient fact effectively (and rightly) forced out Lois Lerner, the IRS honcho who presided over the mess. Lerner is gone, but has anything fundamentally changed at the agency that would prevent such actions in the future?

Sadly, no. After Lerner refused to testify before Congress on the matter, the Department of Justice opted to not pursue any charges against her. Now, it’s time for Congress to step in on behalf of all taxpayers – and there are plenty of things it can do.

One relatively low-hanging piece of legislative fruit would be passing H.R. 1104 -- a bill that would prevent the IRS from imposing gift taxes on contributions made to nonprofit groups. This has been a “sword of Damocles” that the IRS has been swinging over certain groups for years. Were the sword to fall, affected charitable groups would in essence be shuttered as few donors would be willing to pay taxes on contributions. Though much attention has been paid to the treatment of conservative groups under the current Obama administration, this threat imperils groups of all ideological viewpoints, which is why the bill easily passed the House with bipartisan support earlier this year. The Senate should act on it immediately. ...

All of this is not to say Congress shouldn’t necessarily impeach IRS Commissioner Koskinen. If he, in fact, broke the law he should be held accountable before the law. But the primary focus ought to be on fixing the numerous underlying problems at the IRS. The recent scandals present an opportunity to address some of these in a bipartisan fashion. It would be a shame if Congress was so distracted by Koskinen that it failed to do so.

Continue reading

November 14, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Friday, November 13, 2015

American Lawyer: Congressional Showdown Over Law Student Loans Is Inevitable, With Law Schools The Likely Losers

American Lawyer LogoAmerican Lawyer:  Is Washington Finally Tired of Welfare for Law Schools?, by Matt Leichter:

Just as the academic year geared up this fall, both The Washington Post and The New York Times ran editorials sharply attacking the generous federal lending programs that law students depend on. ...

The Post's Charles Lane appropriately characterized the Grad PLUS Loan Program, which provides essentially unrestricted lending to graduate and professional students, as a "de facto bailout" for law schools. The schools capture the increased lending to law students and then perversely pass it back to them as higher tuition charges. Consequently, efforts to make legal education cheaper backfire, turning the federal loan program on its head. Eventually the government will write down the loans for what it intended to be a deficit reduction program.

The Times' editorial board struck with even more venom, calling the six for-profit law schools "scams" and accusing non-profit and public schools of similar behavior. The culprits: warped incentives and unchecked Grad PLUS loans. The Times' solutions were to either extend to all law schools the gainful employment rule—which limits student loans based on graduate employment rates—or to cap the funding to graduate students. At the same time, the paper argued for diverting the money flowing to law schools to legal aid for the poor.

The drumbeat of editorials criticizing law schools and the ABA is not new, but the response from lawmakers, especially to Times' article, may signal a future shift in how the government lends to law students. Notably, senators from both parties are raising concerns. ...

Continue reading

November 13, 2015 in Legal Education | Permalink | Comments (7)

Weekly Tax Roundup

Weekly Legal Education Roundup

Weekly SSRN Tax Roundup

Weekly Student Tax Note Roundup

Continue reading

November 13, 2015 in Scholarship, Tax, Weekly Student Tax Note Roundup | Permalink | Comments (0)

Fordham Hosts Symposium Today On We Are What We Tax

Fordham Law ReviewFordham hosts a two-day symposium on We Are What We Tax.  Here are today's speakers:

  • John Dzienkowski (Texas) & Robert Peroni (Texas), The Decline in Tax Adviser Professionalism in American Society
  • Ajay Mehrotra (Northwestern) & Julia Ott (The New School), A Brief History of the Capital Gains Tax Preference
  • Lisa Philipps (Osgoode Hall), Tax Policy as Performance: Personal Savings and the Constitution of Middle Class Identity
  • Martha McCluskey (SUNY-Buffalo), Framing Middle Class Insecurity: Tax and the Ideology of Unequal Economic Growth

Continue reading

November 13, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

U.S. News To Law School Rankings Voters: Oops

2016 U.S. News RankingsI previously blogged how U.S. News & World Report sent defective ballots to voters in the law school specialty rankings (Clinical, Environmental Law, Health Law, Intellectual Property, International Law, Legal Writing, Tax, and Trial Advocacy) by instructing them to "[i]dentify up to fifteen (15) schools that have the highest-quality alternative dispute resolution courses or programs."  As I predicted, U.S. News has sent a new letter to voters, apologizing for the snafu and enclosing new, corrected ballots:

Continue reading

November 13, 2015 in Law School Rankings, Legal Education | Permalink | Comments (1)

Infanti: The Tax Perils Of Obergefell And Windsor

Anthony C. Infanti (Pittsburgh), Victims of Our Own Success: The Perils of Obergefell and Windsor, 76 Ohio St. L.J. Furthermore 79 (2015):

This short essay was spurred by the numerous celebrations of the Supreme Court’s recent decision in Obergefell v. Hodges legalizing same-sex marriage in all fifty states. Though the essay acknowledges the importance of both Obergefell and the Supreme Court’s earlier decision in United States v. Windsor, it highlights the significant perils that these decisions entail for the LGBT community. In the essay, I use tax as a lens for describing some of the lesser-known perils associated with these decisions in the hopes of making those perils more concrete and easily understood by a wide audience of (tax and nontax) readers.

November 13, 2015 in Scholarship, Tax | Permalink | Comments (0)

Symposium: Methods Of Teaching And Forming Professional Identity

The IRS Scandal, Day 918

IRS Logo 2Washington Post op-ed:  Skip the Investigations, Just Work to Win the White House, by Charles Krauthammer:

At a certain point you have to realize you can’t hit a fastball. House Republicans don’t quite get that they are hopeless at oversight hearings. They keep losing — and now the chairman of the House Oversight Committee has just introduced articles of impeachment against John Koskinen, the commissioner of the Internal Revenue Service.

I’m sympathetic to the GOP motive, given how the Obama IRS has consistently obstructed and misled Congress in the tax-exemption scandal. But impeachment is no ordinary move. No agency chief or Cabinet officer has been impeached since 1876. And even proponents admit there is no chance of Koskinen being removed from office, because the Senate will never convict.

Instead, says Committee Chairman Jason Chaffetz, the purpose is public education, “to demonstrate to the American people” that the IRS “will be held accountable” for violating the public trust.

I’m all for demonstrating malfeasance. But the GOP House has given a five-year display of its inability to successfully demonstrate anything. From Benghazi all the way back to Operation Fast and Furious, the impact of its hearings on public perception has been either zero or negative.

Take the IRS case. The Oversight Committee, led at the time by Darrell Issa, blew it, allowing the IRS’ Lois Lerner to deliver a statement proclaiming innocence and then claiming Fifth Amendment protection from having to answer any questions. Committee member Trey Gowdy nearly flew out of his seat to point out that she had just forfeited her immunity.

Too late. She got away with it. That failure is what brings us to impeachment today. But impeachment was never intended to be a mulligan. ...

In each of these cases [Benghazi, Planned Parenthood, Republicans had the facts and the argument. And yet in every one they failed. What makes them think that they will fare any better in the next iteration, the impeachment of a minor official in an expiring administration?

Chaffetz says that the purpose is to rein in the IRS. I’m all for that. You know how you do it? Win the presidency, appoint honest new IRS leadership and get your own Justice Department to do a real investigation.

It’s a harder road to accountability. But it gets you to where you want to go.

Continue reading

November 13, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Thursday, November 12, 2015

NY Times: Why Do The Female Halves Of Academic Power Couples Get No Respect?

House of CardsNew York Times:  Even Famous Female Economists Get No Respect, by Justin Wolfers (Michigan):

Men’s voices tend to dominate economic debate, although perhaps this is shaped by how we talk about the contributions of female economists. This is easiest to see in how we discuss the work of economist power couples.

Remembering the journalistic cliché that one is an example, two is a coincidence and three is a trend, I figured it worth exploring how female economists are treated.

Continue reading

November 12, 2015 in Legal Education, Tax | Permalink | Comments (0)

A Last Hurrah For Republican Tax Slashers

Financial Times op-ed:  A Last Hurrah for Republican Tax Slashers, by James Pethokoukis:

The Republican party’s raison d’être is cutting taxes. It may even be its divine commission. God put Republicans on earth to cut taxes, the conservative columnist, Robert Novak, once said, and failure to do that means “they have no useful function”.

Republicans should pray for a new purpose. Their standing with middle-class voters is little improved from 2012. If Hillary Clinton becomes the 45th US president, it would be the first time since 1948 that the Republicans have lost three consecutive elections. Their “supply-side” orthodoxy would merit much of the blame. Big tax cuts, particularly for the wealthiest, do not work in an age of high inequality and heavy debt. Republicans need an economic agenda that respects markets while also recognising the challenges facing America and its anxious middle class. ...

Continue reading

November 12, 2015 in Political News, Tax | Permalink | Comments (1)

Protesters Demand Firing Of Tenured Vanderbilt Law Professor Over Publication Of Op-Ed

SwainInside Higher Ed, Protests Spread:

The sustained protests at the University of Missouri, which led to the ouster of a system president and campus chancellor, are inspiring minority students at many campuses. ...

At Vanderbilt, many minority students have in recent days renewed a push for the university to take action against Carol Swain (right), a tenured professor of political science and law, over a column she wrote in January after the terrorist attacks in Paris against the satirical magazine Charlie Hebdo.

In the January column, Swain asked, "What would it take to make us admit we were wrong about Islam? What horrendous attack would finally convince us that Islam is not like other religions in the United States, that it poses an absolute danger to us and our children unless it is monitored better than it has been under the Obama administration?"

Many students and others said that the column stereotyped all Muslims in a way that was profoundly biased, but the university defended Swain's right to free speech.

Continue reading

November 12, 2015 in Legal Education | Permalink | Comments (17)

Soled & Thomas: Revisiting The Taxation Of Fringe Benefits

Jay A. Soled (Rutgers) & Kathleen DeLaney Thomas (North Carolina), Revisiting the Taxation of Fringe Benefits, 91 Wash. L. Rev. ___ (2015):

The receipt of workplace fringe benefits has become increasingly ubiquitous. As a result of their employment, employees often receive a cornucopia of fringe benefits, including frequent-flier miles, hotel reward points, rental car preferred status, office supply dollar coupons, cellular telephone use, home Internet service, and, in some instances, even free lunches, massages, and dance lessons. Technological advances and workforce globalization are important contributory factors to the popularity of what were, until the turn of this century, previously unknown fringe benefits.

Continue reading

November 12, 2015 in Scholarship, Tax | Permalink | Comments (1)

Huffman: Online Learning Grows Up — And Heads To Law School

Max Huffman (Indiana-Indianapolis), Online Learning Grows Up -- And Heads to Law School, 49 Ind. L. Rev. 57 (2015):

Online education is now in the mainstream. Schools use online teaching methods as early as elementary school and thousands of students across the country pursue their entire high school studies online. Undergraduate and graduate programs are offered online. At Indiana University, where I teach, there are nearly fifty undergraduate, graduate, and professional degrees offered entirely online. An increasing percentage of law students have taken at least one, and some have taken several, online courses before matriculating into the JD program.

Continue reading

November 12, 2015 in Legal Education, Scholarship | Permalink | Comments (1)

Fordham Hosts Symposium Today On We Are What We Tax

Fordham Law ReviewFordham hosts a two-day symposium on We Are What We Tax.  Here are today's speakers:

  • Victor Fleischer (San Diego), Job Creationism: Entrepreneurship and Tax Policy
  • David Clingingsmith (Case Western) & Scott Shane (Case Western), How Individual Income Tax Policy Affects Entrepreneurship
  • Sloan Speck (Colorado), The Social Boundaries of Corporate Taxation

Continue reading

November 12, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

IRS May Challenge Dell's Use Of Tracking Stock In Acquisition Of EMC To Avoid $9 Billion Tax Bill

Dell EMCFollowing up on my previous post, Dell's Use Of Tracking Stock In Acquisition Of EMC Will Save $10 Billion In Taxes:  Re/code, Dell’s EMC Deal Could Fall Apart on Tax Rule:

Michael Dell’s ambitious $67 billion plan to take over storage giant EMC may face a big tax burden that could complicate or derail the deal entirely.

Dell insiders are worried the company could end up being on the hook for a tax bill of up to $9 billion following a regulatory review, sources familiar with the matter told Re/code. The worries stem from Dell’s unusual proposal to use a new type of stock share to help pay for the acquisition. Their concerns are also rooted in EMC’s wildly successful investment in the software company VMware, the value of which has risen by tens of billions of dollars since EMC acquired it in 2003.

The combination of factors has some Dell execs concerned, sources said, that certain key aspects of the deal may not qualify for the sort of tax treatment they consider essential for the transaction — the biggest tech acquisition ever proposed — to succeed.

Continue reading

November 12, 2015 in IRS News, News, Tax | Permalink | Comments (0)

'Marty Was Always My Best Friend': Ruth Bader Ginsburg's Love Story

RBGJezebel, 'Marty Was Always My Best Friend': Ruth Bader Ginsburg's Love Story:

RBG told me, “Marty was always my best friend.”

That remarkable intimacy had survived Marty’s bout with cancer in law school, and RBG’s two diagnoses, a decade apart. Cancer had left them alone long enough to be together for the nearly sixty years they had been best friends. But it came back. In 2010, doctors said Marty had metastatic cancer.

Continue reading

November 12, 2015 in Obituaries, Tax | Permalink | Comments (1)

The Latest Tax Lure From Abroad for U.S. Firms: Innovation Boxes

Wall Street Journal op-ed:  The Latest Lure From Abroad for U.S. Firms—Innovation Boxes, by Denis Hughes (Stonepeak Infrastructure Partners):

The recent merger talks between New York-based Pfizer and Dublin-based Allergan are the latest signal that America’s approach to taxing international profits is luring U.S. companies to relocate abroad, or merge with foreign companies. Unfortunately, the situation is about to get significantly worse.

The U.S. corporate tax rate, 35%, is the highest in the industrialized world. That’s a significant blow to America’s competitiveness. And many countries combine lower corporate rates with other incentives to lure companies to their shores.

One such incentive is known as the “innovation box,” under which income earned from a company’s intellectual property (such as patents) is taxed at a lower rate—typically between 5% and 15%. Several countries have enacted innovation boxes (aka patent boxes), including the United Kingdom, France, China, Spain, the Netherlands, Italy and Belgium. ...

[T]he U.S. Congress needs to create an innovation box in this country.

Continue reading

November 12, 2015 in Tax | Permalink | Comments (0)

The IRS Scandal, Day 917

IRS Logo 2Albany Times Union editorial, The IRS Scandal Lives On:

It’s been more than two years since allegations surfaced that the Internal Revenue Service targeted tea party groups seeking tax-exempt status with extra scrutiny. Now the Justice Department has closed the case without any criminal charges. But the controversy seems unlikely to end anytime soon.

And that’s too bad, because the problem at the heart of the IRS’ effort – the widespread abuse of tax-exempt status – hasn’t gone away. 

Continue reading

November 12, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

Wednesday, November 11, 2015

Moot Court: The Movie

All RiseAll Rise:  Journeys to a Just World:

How can international disputes be resolved in the courtroom rather than on the battlefield? All Rise brings this complex question into sharp and personalized focus through the journeys of seven passionate students of law from India, Israel, Jamaica, Palestine, Russia, Singapore, and Uganda to compete in the world championships in Washington, DC, of the Philip C. Jessup International Law Moot Court Competition (the “Jessup”), the world’s largest simulated court competition. The “court” is the International Court of Justice (“ICJ”), the judicial arm of the United Nations. Against this backdrop, this moving film lays bare the struggles, triumphs and transformations they experience alone and together.

Continue reading

November 11, 2015 in Legal Education | Permalink | Comments (0)

Marian: The State Administration Of International Tax Avoidance

Omri Y. Marian (UC-Irvine), The State Administration of International Tax Avoidance:

In November of 2014, hundreds of advanced tax agreement (ATAs) issued by Luxembourg’s Administration des Contributions Directes (Luxembourg’s Inland Revenue, or LACD) to multinational corporate taxpayers (MNCs) were made public. Using an original dataset generated from a hand-coded sample of 172 leaked documents, the Article explores LACD administrative practices in issuing ATAs. The analysis demonstrates how a jurisdiction can be made a tax-haven by administrative practices, rather than by state law. LACD cannot be reasonably viewed – as some have suggested in LACD’s defense – a passive player in MNCs’ tax avoidance schemes. Rather, LACD is best described as a manufacturer of tax arbitrage opportunities. Specifically, even when the tax laws of the jurisdictions of residence (i.e., investors) and source (i.e., investment) are harmonized, LACD produced regulatory instruments that were intended to artificially create legal differences between the tax laws of the source and residence jurisdictions. MNCs could then exploit the manufactured tax differences to their advantage. LACD collected a fee that was functionally linked to the amount of taxes avoided by MNCs in the other jurisdictions.

Continue reading

November 11, 2015 in Scholarship, Tax | Permalink | Comments (0)

Seven Former IRS Commissioners Call For Restoring IRS Budget Cuts

IRS Logo 2Seven former IRS Commissioners  have written this joint letter to the leaders of Congress’s appropriations committees urging them to reconsider proposed cuts in the IRS's budget:

The appropriations reductions for the IRS over the last five years total $1.2 billion, more than a 17% cut from the IRS appropriation for 2010.  None of us ever experienced, nor are we aware of, any IRS appropriations reductions of this magnitude over such a prolonged period of time.

Continue reading

November 11, 2015 in IRS News, Tax | Permalink | Comments (0)

Legal Enforcement and Corporate Behavior: An Analysis Of Tax Aggressiveness After An Audit

Jason DeBacker (Middle Tennessee), Bradley Heim (Indiana) & Anh Tran (Indiana) & Alexander Yuskavage (U.S. Treasury Department), Legal Enforcement and Corporate Behavior: An Analysis of Tax Aggressiveness After an Audit, 58 J.L. & Econ. 291 (2015):

Contrary to common expectations, legal enforcement may increase subsequent corporate misbehavior. Using Internal Revenue Service and financial statement data, we find that corporations gradually increase their tax aggressiveness for a few years following an audit and then reduce it sharply. We show that this U-shaped impact is consistent with strategic responses on the part of firms and with Bayesian updating of audit risk. This adverse effect on corporate behavior calls for a reexamination of both the theory and policy of legal enforcement.

Continue reading

November 11, 2015 in Scholarship, Tax | Permalink | Comments (0)

Taxes, Lawyers, And The Decline Of Witch Trials

Noel D. Johnson & Mark Koyama (both of George Mason University, Department of Economics), Taxes, Lawyers, and the Decline of Witch Trials in France, 57 J.L. & Econ. 77 (2014):

This paper explores the rise of the fiscal state in the early modern period and its impact on legal capacity. To measure legal capacity, we establish that witchcraft trials were more likely to take place where the central state had weak legal institutions. Combining data on the geographic distribution of witchcraft trials with unique panel data on tax receipts across 21 French regions, we nd that the rise of the tax state can account for much of the decline in witch trials during this period. Further historical evidence supports our hypothesis that higher taxes led to better legal institutions.

November 11, 2015 in Scholarship, Tax | Permalink | Comments (1)

SSRN Tax Professor Rankings

SSRN LogoSSRN has updated its monthly rankings of 750 American and international law school faculties and 3,000 law professors by (among other things) the number of paper downloads from the SSRN database.  Here is the new list (through November 1, 2015) of the Top 25 U.S. Tax Professors in two of the SSRN categories: all-time downloads and recent downloads (within the past 12 months):







Reuven Avi-Yonah (Michigan)


Reuven Avi-Yonah (Michigan)



Paul Caron (Pepperdine)


Michael Simkovic (Seton Hall)



Michael Simkovic (Seton Hall)


D. Dharmapala (Chicago)



Louis Kaplow (Harvard)


Gregg Polsky (N. Carolina)



D. Dharmapala (Chicago)


Paul Caron (Pepperdine)



Vic Fleischer (San Diego)


Ed Kleinbard (USC)



James Hines (Michigan)


Richard Ainsworth (BU)



Ted Seto (Loyola-L.A.)


Jeff Kwall (Loyola-Chicago)



Richard Kaplan (Illinois)


Louis Kaplow (Harvard)



Ed Kleinbard (USC)


Robert Sitkoff (Harvard)



Katie Pratt (Loyola-L.A.)


Dan Shaviro (NYU)



Richard Ainsworth (BU)


Katie Pratt (Loyola-L.A.)



Carter Bishop (Suffolk)


Brad Borden (Brooklyn)



Robert Sitkoff (Harvard)


Dick Harvey (Villanova)



Jen Kowal (Loyola-L.A.)


Jack Manhire (Texas A&M)



Dennis Ventry (UC-Davis)


Chris Hoyt (UMKC)



Chris Sanchirico (Penn)


Chris Sanchirico (Penn)



Brad Borden (Brooklyn)


Joe Bankman (Stanford)



David Weisbach (Chicago)


Jen Kowal (Loyola-L.A.)



Francine Lipman (UNLV)


Omri Marian (UC-Irvine)



Bridget Crawford (Pace)


Nancy McLaughlin (Utah)



David Walker (BU)


Ruth Mason (Virginia)



Dan Shaviro (NYU)


David Gamage (UC-Berkeley)



Herwig Schlunk (Vanderbilt)


Vic Fleischer (San Diego)



Steven Bank (UCLA)


Francine Lipman (UNLV)


Note that this ranking includes full-time tax professors with at least one tax paper on SSRN, and all papers (including non-tax papers) by these tax professors are included in the SSRN data.

Continue reading

November 11, 2015 in Legal Education, Scholarship, Tax, Tax Prof Rankings | Permalink | Comments (1)

WSJ: Republican Candidates Push Bold Tax Plans

Tax Foundation 1

Following up on last week's post, NY Times, WSJ Editorialize On Republican Presidential Candidates' Tax Plans:  Wall Street Journal, Republican Candidates Push Bold Tax Plans:

Republican presidential candidates are competing to propose dramatic changes to tax policy that go well beyond the party’s previous platforms and all but ensure the issue will play a central role in the general election.

Driven by a desire to stand out in a crowded field and spark economic growth, the GOP contenders no longer just say they want to lower rates and expand the tax base. Their new ideas, once the province of right-leaning think tanks, make previous Republican plans look timid.

Continue reading

November 11, 2015 in Political News, Tax | Permalink | Comments (1)

Cauble: Reforming The Non-Disavowal Doctrine

Emily Cauble (DePaul), Reforming the Non-Disavowal Doctrine:

One well established feature of tax law is that, oftentimes, substance prevails over form. In other words, the substance of a transaction will determine the transaction’s tax consequences. For instance, tax consequences will not depend solely on the label that a taxpayer assigns to a given transaction. Instead, the IRS can examine the transaction’s economic features to more accurately characterize it for tax purposes.

Continue reading

November 11, 2015 in Scholarship, Tax | Permalink | Comments (1)

$1,000 Honorarium To Attend 32nd Annual Law Prof Summer Law & Econ Institute

GM32nd Economics Institute for Law Professors:

Event Date: Sunday, July 10 to Friday, July 22, 2016

Location: The Omni Homestead Resort, Hot Springs, VA

Prerequisite:  The Economics Institute is carefully designed for those who possess little or no previous formal economics education. It covers basic price theory, with emphasis on the allocative effects of alternative property rights regimes, transaction cost economics, and the application of basic economic theory to a variety of legal issues.  As such, there is no prerequisite for this Institute.

Continue reading

November 11, 2015 in Conferences, Legal Education, Tax | Permalink | Comments (0)

The IRS Scandal, Day 916

Sign the petition to Impeach IRS Commissioner John Koskinen for:

  • Failing to comply with a subpoena for evidence resulting in the destruction of 24,000 Lois Lerner emails.
  • Failing to testify truthfully and providing false and misleading information to the Congress.
  • Failing to notify Congress that key evidence had gone missing.

John Koskinen has done everything in his power to protect the IRS from its outrageous targeting scandal. Now, the Obama Justice Department has announced it will not press charges. So, it's time for Congress finally to stand up for the American people.

The Hill op-ed:  Impeach Koskinen, by Jenny Beth Martin (President & Co-founder, Tea Party Patriots):

House Republicans have introduced a resolution to impeach Internal Revenue Service Commissioner John Koskinen, about which, a simple thought — it’s about damn time. ...

Remember, it was the IRS that was used as a political weapon to target citizens who were deemed opponents of this Administration. My organization and many affiliated with it have been on the receiving end of this political weapon and I would not wish it upon any American--including my worst political adversaries. 

Not surprisingly, it was announced last month that the Obama Justice Department would not press charges against the person at the center of this scandal – former IRS Director of Exempt Organizations Lois Lerner. So, just when will the American people receive justice? 

A start would be to impeach and convict the man who continued the cover-up and denied justice for the American people, and I truly give House Republicans credit for seeming to understand this. Will Congress step up and do something meaningful to defend the American people? Help make your voice heard by adding your voice to the national petition at

It’s about damn time.

Continue reading

November 11, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Tuesday, November 10, 2015

McEntee: The Achilles' Heel Of Law Schools — Charging More To The Least Qualified Students

Kyle McEntee (Law School Transparency), Price Discrimination Will Ultimately Bite Law Schools:

2016 U.S. News RankingsOur investigation into law school admissions practices and trends has sent shock waves through the legal profession. Some law school deans remain in denial, but more (at least privately) want a minority of law schools to stop damaging legal education’s reputation. With no united front among law schools, influential members of Congress waiting to pounce, and the ABA primed to act, it seems the bets some schools made on regulatory inaction were misplaced.

One reason these bets may prove lethal is that law schools charge higher prices to those who are more likely to struggle.

This is one particularly egregious artifact of the U.S. News rankings methodology, which affects how law schools allocate scholarship money. Scholarships are predominately provided in exchange for relatively higher LSAT scores and, to a lesser extent, GPAs. While these resources decisions have always been questionable, they become even more ethically dubious as price discrimination shifts even more dramatically towards discounting tuition for those most likely to complete school, pass the bar, and obtain a legal job.

Continue reading

November 10, 2015 in Legal Education | Permalink | Comments (14)

Brooks Presents Quasi-Public Spending Today At Columbia

Brooks (John)John R. Brooks (Georgetown) presents Quasi-Public Spending, 104 Geo. L.J. ___ (2016), at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium Series hosted by Alex Raskolnikov and Wojciech Kopczuk:

This Article proceeds as follows. In Part II, I review the Affordable Care Act and income-driven student loan repayment, describing how each program operates as a substitute for direct public spending. In Part III, I briefly sketch out some of the reasons for high and growing government budgets, since the political ceiling on the size of government is a key motivator for policymakers to take advantage of quasi-public spending. Part IV discusses the structure of quasi-public spending in more detail and contrasts it with some similar forms of government intervention. Part V examines in detail the unique features of quasipublic spending as compared to direct public spending. Here I focus in particular on the fact that much of the spending is off-budget, and also on the fact that a quasi-public spending program is likely to be complex. While both of these features have given some commentators pause, I provide a qualified defense of each. In Part VI, I use the analysis in the earlier Parts to derive a framework for helping policymakers to determine whether quasi-public spending is feasible and reasonable. Because of its particular features, quasipublic spending will not be suitable to all settings, even where policymakers might have worthwhile goals. Part VII applies that framework preliminarily to several other policy areas. Part VIII concludes.

Continue reading

November 10, 2015 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Shaviro Presents Getting A 'Fix' On Recent International Tax Policy Developments Today At McGill

Shaviro (2015)Daniel Shaviro (NYU) presents The Crossroads versus the Seesaw: Getting a 'Fix' on Recent International Tax Policy Developments at McGill today as part of its Spiegel Sohmer Tax Policy Colloquium Series:

U.S. international tax policy is at a crossroads, say those who urge the United States to adopt what common parlance would call a territorial system. They argue that one of the two ways forward they identify – trying to fortify the current U.S. system – would lead to ever-costlier outlier status for our tax system, and ever-declining competitiveness for U.S. multinationals. They therefore urge U.S. policymakers to embrace what they identify as the other way forward: conforming to global norms by adopting a territorial system.

Continue reading

November 10, 2015 in Book Club, Colloquia, Scholarship, Tax | Permalink | Comments (0)

Hatfield: Taxation And Surveillance -- An Agenda

Michael Hatfield (University of Washington), Taxation and Surveillance: An Agenda, 17 Yale J.L. & Tech. 319 (2015):

Among government agencies, the IRS likely has the surest legal claim to the most information about the most Americans: their hobbies, religious affiliations, reading activities, travel, and medical information are all potentially tax relevant. Privacy scholars have studied the arrival of Big Data, the internet-of-things, and the cooperation of private companies with the government in surveillance, but neither privacy nor tax scholars have considered how these technological advances should impact the U.S. tax system. As government agencies and private companies increasingly pursue what has been described as the “growing gush of data,” the use of these technologies in tax administration will become increasingly important to consider.

Continue reading

November 10, 2015 in Scholarship, Tax | Permalink | Comments (0)

Princeton/UCLA Study: It Is Time To Ban Laptops In Law School Classrooms

Steven M. Eisenstat (Suffolk), A Game Changer: Assessing the Impact of the Princeton/UCLA Laptop Study on the Debate of Whether to Ban Law Student Use of Laptops During Class, 92 U. Det. Mercy L. Rev. 83 (2015):

No LaptopIn this Article I discuss the impact on legal education of a recent study conducted at Princeton University and UCLA, which compared the levels of comprehension and retention of class lectures by those students who handwrote their class notes with those students who typed their notes onto their laptops. The study involved three separate experiments. In each test, the subjects using laptops had no access to the Internet, and were only permitted to use their laptops for taking class notes. Thus all possible laptop distractions were eliminated. In all three experiments, those students who handwrote their notes outperformed their counterparts who typed their notes on assessments administered between 30 minutes and one week after the lectures.

This study thus raises another chapter in the continuing debate regarding whether students should be permitted to use their laptops in class. Prior to the Princeton/UCLA study, the debate primarily centered around the distractive effects which laptops had on both laptop users who were engaged in activities unrelated to what was being discussed in class, and on their classmates who were sitting nearby and were distracted by the visuals and sounds emanating from the laptops. Such distractions included surfing the Internet, playing video games, and emailing others in the class.

Continue reading

November 10, 2015 in Legal Education, Scholarship | Permalink | Comments (9)

The Price We Pay: A Movie About Offshore Tax Havens

The Price We Pay

The Price We Pay is inspired by Brigitte Alepin’s book La Crise fiscale qui vient [Pay Your Fair Share of Taxes...Like We Do]Director Harold Crooks (who co-directed Surviving Progress with Mathieu Roy) blows the lid off the dirty world of corporate malfeasance with this incendiary documentary about the dark history and dire present-day reality of big-business tax avoidance, which has seen multinationals depriving governments of trillions of dollars in tax revenues by harboring profits in offshore havens. Tax havens, originally created by London bankers in the 50s, today put over half the world’s stock of money beyond reach of  public treasuries.

Nation states are being reshaped by this offshoring of the world’s wealth. Tax avoidance by big corporations  and the wealthy – citizens of nowhere for tax purposes – is paving the way to historic levels of inequality and placing the tax burden on the middle class and the poor. Crusading journalists, tax justice campaigners and former finance and technology industry insiders speak frankly about the accelerating trends that are carrying the Western world to an  unsustainable future.

Reviews of The Price We Pay:

Continue reading

November 10, 2015 in Book Club, Tax | Permalink | Comments (1)

Evidence Shows Most Lawyers Continue To Have Profitable, Fulfilling Careers (In Texas)

TexasTexas Lawyer: Evidence Shows Most Lawyers Continue to Have Profitable, Fulfilling Careers, by Milan Markovic (Texas A&M):

The one reliable longitudinal study that has been conducted does not support the view of lawyers as miserable and debt-ridden. The After the JD study followed a representative cohort of law school graduates from the class of 2000 and found that the vast majority were satisfied with their decisions to become lawyers. Debt load had no effect on career satisfaction, and nearly half of the lawyers in the cohort paid off all of their debt by 2012.

Of course, the class of 2000 graduated into a better economy and paid less tuition than more recent classes. Nevertheless, while more rigorous longitudinal research is needed, the recession appears to have not impeded attorneys' long-term prospects.

The State Bar of Texas conducts an income survey of its nearly 100,000 members. The most recent survey was conducted in 2013 and provides median incomes for full-time lawyers by the number of years they have been licensed. The median income for lawyers in private practice who have been licensed for two years or less is $69,238. This figure rises to $99,152 for lawyers licensed for three to six years.

Continue reading

November 10, 2015 in Legal Education | Permalink | Comments (14)

Grinberg & Pauwelyn: The Emergence Of A New International Tax Regime

ASILItai Grinberg (Georgetown) & Joost Pauwelyn (Graduate Institute, Geneva), The Emergence of a New International Tax Regime: The OECD’s Package on Base Erosion and Profit Shifting (BEPS), ASIL Insights, Vol. 19, Issue 24 (Oct. 28, 2015):

International tax law is rarely discussed amongst public international lawyers. Tax policy is highly technical and perceived as one of the last bastions of Westphalian sovereignty. Cross-border tax cooperation is difficult, as it is inevitably distributional: tax revenues, the “lifeblood of the state,” are split among countries. With origins in work undertaken by the League of Nations in the 1920s, international tax law is centered on a network of more than 3,800 bilateral tax treaties. Little progress had been made towards a multilateral tax regime, until recently.

Continue reading

November 10, 2015 in Scholarship, Tax | Permalink | Comments (0)

Call for Papers: 2016 International Conference On Tax Administration

Call for Papers:  The 12th International Conference on Tax Administration at the Crowne Plaza Hotel, Coogee, Sydney on 31st March & 1st April 2016. The theme of the conference will be Global trends and developments in tax administration service delivery. Those interested in presenting a paper at this conference are encouraged to submit a proposal that accords with this theme (for example, digitalisation, simplification, benchmarking, alternative tax dispute resolution, citizen-focused tax administration, fostering voluntary compliance, tax administrative responses to BEPS, etc).

Your proposal should include the following details:

Continue reading

November 10, 2015 in Conferences, Scholarship, Tax | Permalink | Comments (0)

The IRS Scandal, Day 915

IRS Logo 2Forbes:  Republicans Want IRS To Target Hillary Clinton, by Peter J. Reilly:

Given the outrage that Republicans have expressed about the “targetting” of the Tea Party by the IRS, you would think that they would be slow to advocate IRS political targetting.  Apparently  it is more a matter of who’s ox is being gored.

When the Council on American-Islamic Relations (CAIR) called for Ben Carson to step out of the Presidential race, he countered by demanding that the IRS immediately revoke its exemption.  Then this week Reince Priebus, Chair of the Republican National Committee, wrote to Commissioner Koskinen about a grave matter concerning the Clinton Health Access Initiative. ...

It has become an article of faith in some circles that the delays and intrusive inquiries involving Tea Party exemption application was politically motivated.  The main evidence of that motivation is Democratic lawmakers complaining about dark money organizations and Lois Lerner and President Obama bemoaning the Citizens United decision.  Everybody agrees that the IRS shouldn’t oughta have targetted the Tea Party, whether it did or not. So why should the IRS now target the Clintons? And launching an audit in response to a clerical error would clearly be political targetting.

Continue reading

November 10, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)