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The David R. Tillinghast Lecture: Taxing International Income: Inadequate Principles, Outdated Concepts, And Unsatisfactory Policies, Michael J. Graetz
The David R. Tillinghast Lecture: Taxing International Income: Inadequate Principles, Outdated Concepts, And Unsatisfactory Policies, Michael J. Graetz
Faculty Scholarship
It is a pleasure to be here today to deliver the first David R. Tillinghast Lecture of the 21st century, a lecture honoring a man who has done much to shape and stimulate our thinking about the international tax world of the 20th.
Our nation's system for taxing international income today is largely a creature of the period 1918-1928, a time when the income tax was itself in childhood. From the inception of the income tax (1913 for individuals, 1909 for corporations) until 1918, foreign taxes were deducted like any other business expense. In 1918, the foreign tax credit (FTC) …
Frictions As A Constraint On Tax Planning, David M. Schizer
Frictions As A Constraint On Tax Planning, David M. Schizer
Faculty Scholarship
The government often uses narrow tax reforms to target specific planning strategies. Sometimes the targeted transaction is stopped. But in other cases, taxpayers press on, tweaking the deal just enough to sidestep the reform. The difference often lies in transaction costs, financial accounting, and other 'frictions, " which are constraints on tax planning external to the tax law.
This Article contributes a methodology for determining whether frictions will block end runs, and illustrates the effect of frictions by comparing the constructive sale rule of section 1259 with the constructive ownership rule of section 1260. These reforms use the same statutory …