Law Commons^™

The Tax Treatment Of Student Loan Discharge And Cancellation, John R. Brooks

Georgetown Law Faculty Publications and Other Works

The standard view is that, absent an express exclusion in the tax code, cancellation of student debt is taxable. Under this view, any immediate debt relief through administrative action would generate a tax bill. More troubling, the millions of borrowers in Income-Driven Repayment could face a “tax bomb” because of their promised loan cancellation, potentially hitting borrowers with bills for $100,000 or more in the same year that the government tells them their loan obligations have ended. These perverse outcomes are, however, based on a misreading of the tax law. The standard tax treatment of debt cancellation does not work …

Redesigning Education Finance: How Student Loans Outgrew The “Debt” Paradigm, John R. Brooks, Adam J. Levitin

Georgetown Law Faculty Publications and Other Works

This Article argues that the student loan crisis is due not to the scale of student loan debt, but to the federal education finance system’s failure to utilize its existing mechanisms for progressive, income-based payments and debt cancellation. These mechanisms can make investment in higher education affordable to both individuals and the government, but they have not been fully utilized because of the mismatch between the current system’s economic reality and its legal, financial, and institutional apparatus.

The current economic structure of federal student loans does not resemble a true credit product, but a government grant program coupled with a …

Why A Wealth Tax Is Definitely Constitutional, John R. Brooks, David Gamage

Georgetown Law Faculty Publications and Other Works

Wealth tax reform proposals are playing a major role in the 2020 presidential campaign. However, some opponents of these wealth tax reform proposals have claimed that a wealth tax would be unconstitutional. Other prominent critics have argued that wealth tax reforms are probably unconstitutional, so that, after review by the courts, the “likeliest outcome is that a wealth tax will raise exactly zero dollars.”

These claims are wrong. More precisely, these claims are wrong conditioned on wealth tax legislation being carefully drafted so as to ensure its constitutionality. As we will explain in this essay, properly drafted, wealth tax reform …

Formulating The International Tax Debate: Where Does Formulary Apportionment Fit?, Itai Grinberg

Georgetown Law Faculty Publications and Other Works

As the contributions in this volume are being written, the Inclusive Framework nations, a group drawn together by the Organisation for Economic Co-operation and Development (OECD) as part of its Base Erosion and Profit Shifting (BEPS) project, are in the midst of a consultation process intended to revise the international corporate tax profit allocation and nexus rules. At the end of May 2019, the OECD released its Programme of Work to Develop a Consensus Solution to the Tax Challenges Arising from the Digitalisation of the Economy. At the beginning of June 2019, this Programme was endorsed by the G20 …