Tax Law Commons^™

Improving Tax Rules By Means-Testing: Bridging Wealth Inequality And "Ability To Pay", James M. Puckett

James Puckett

The federal income tax can and should do more to address wealth disparities and income inequality. The income tax does not directly count wealth, and the realization rule and basis "step-up" at death exclude substantial amounts of income for the wealthy. The Constitution limits Congress's ability to tax wealth. Despite these serious challenges, this Article considers how to potentially bridge the gap between wealth and the income tax. For example, asset-based phase-outs in the income tax should pass muster without apportionment, although their bite would necessarily be limited. The Article posits that the public would be more receptive to phase-outs …

Basic Federal And State Tax Relevant To Estate Planning, Samuel Donaldson, Karen Boxx

Samuel A. Donaldson

No abstract provided.

2010 Federal Tax Update, Samuel Donaldson

Samuel A. Donaldson

This update explains several developments in the substantive federal income, estate and gift tax laws affecting individual taxpayers and small businesses. It contains summaries of significant cases, rulings, regulations, legislation and other matters from August, 2009, through September, 2010. This update generally does not discuss developments in the areas of qualified plans or the taxation of business entities (except to a very limited extent).

2008 Federal Tax Update, Samuel Donaldson

Samuel A. Donaldson

This update explains several developments in the substantive federal income, estate and gift tax laws affecting individual taxpayers and small businesses. It contains summaries of significant cases, rulings, regulations, legislation and other matters from August, 2007, through August, 2008. This update generally does not discuss developments in the areas of qualified plans or the taxation of business entities (except to a very limited extent).

2009 Federal Tax Update, Samuel Donaldson

Samuel A. Donaldson

This paper examines significant developments in the federal income, gift, and estate taxation of individuals and small businesses from August, 2008, through August, 2009. It covers important cases, rulings, regulations, and legislation during this period. This paper generally does not address developments in the areas of qualified plans or the taxation of C corporations (except to limited extents).

Recent Developments - 2013, Samuel Donaldson

Samuel A. Donaldson

three of the nation’s foremost estate planning experts, will guide you through the most significant legislative, regulatory and case law developments of 2013

2006 Federal Tax Update, Samuel Donaldson

Samuel A. Donaldson

This update explains several developments in the federal income, estate and gift taxes affecting individual taxpayers and small businesses. It contains summaries of significant cases, rulings, regulations, legislation and other matters from August, 2005, through September, 2006. This update generally does not discuss developments in the areas of qualified plans or the taxation of business entities (except to very limited extents).

Recent Developments - 2012, Samuel Donaldson

Samuel A. Donaldson

three of the nation’s foremost estate planning experts, will guide you through the most significant legislative, regulatory and case law developments of 2012

2011 Federal Tax Update, Samuel Donaldson

Samuel A. Donaldson

This update explains several developments in the substantive federal income, estate and gift tax laws affecting individual taxpayers and small businesses. It contains summaries of significant cases, rulings, regulations, legislation and other matters from August, 2010, through August, 2011. This update generally does not discuss developments in the areas of qualified plans or the taxation of business entities (except to a very limited extent).

Recent Developments - 2014, Samuel Donaldson

Samuel A. Donaldson

three of the nation’s foremost estate planning experts, will guide you through the most significant legislative, regulatory and case law developments of 2014\

Questioning The Wisdom Of Patent Protection For Tax Planning, Brant J. Hellwig

Brant J. Hellwig

The topic of federal patent protection for tax planning strategies has received considerable recent attention, much of it from a tax bar whose overall incredulity concerning the patentability of tax advice has been transformed into anxiety and disgust by the prospect of infringement actions. In their article Patents, Tax Shelters, and the Firm, Dan Burk and Brett McDonnell approach the subject from a broader perspective by employing theory of the firm principles to evaluate the effects of stronger intellectual property protection in the tax planning arena. While conceding that the possible effects are complex and ambiguous, the authors predict that …

A Proposal For Integrating The Income And Transfer Taxation Of Trusts, Robert T. Danforth

Robert T. Danforth

Present law fails to integrate the income and transfer (i.e., estate and gift) taxation of trusts; a gratuitous transfer to a trust may be incomplete for income tax purposes (producing a so-called grantor trust, the income of which is taxed to the grantor), but complete for transfer tax purposes. Grantors create trusts that exploit two features of this tax law dichotomy: the grantor's income tax payments on trust income enhance the value of the trust by allowing it to appreciate in value income tax free; and present law provides no basis for subjecting this enhanced value to gift or estate …

A Comment On Unification, Grayson M.P. Mccouch

Grayson McCouch

This Article discusses recent proposals aimed at unifying the law of wills and nonprobate transfers. The author notes that default rules of construction present the strongest case for unification, but contends that distinctions between wills and nonprobate transfers remain important in the areas of formalities and restrictions affecting third-party rights. The author concludes that the policy goal should be to allow wills and nonprobate transfers to operate smoothly as complementary methods of deathtime wealth transmission.

The Moving Target Of Tax Reform, Karen C. Burke, Grayson M.P. Mccouch

Grayson McCouch

In 2000, Professor William Turnier proposed a package of three reforms to make the estate tax more “equitable” and “taxpayerfriendly.” All of his proposals—allowing a surviving spouse to inherit a deceased spouse’s unused exemption, replacing the state death tax credit with a deduction, and indexing the exemption for inflation—were eventually enacted. Today, the estate tax remains on the books, but changes in rates and exemptions have severely curtailed its role in the larger federal tax system. Income tax rate reductions for capital gains and dividends have further lightened the tax burden on capital income, and international pressure to reduce the …

The Moving Target Of Tax Reform, Karen C. Burke, Grayson M.P. Mccouch

Karen Burke

In 2000, Professor William Turnier proposed a package of three reforms to make the estate tax more “equitable” and “taxpayerfriendly.” All of his proposals—allowing a surviving spouse to inherit a deceased spouse’s unused exemption, replacing the state death tax credit with a deduction, and indexing the exemption for inflation—were eventually enacted. Today, the estate tax remains on the books, but changes in rates and exemptions have severely curtailed its role in the larger federal tax system. Income tax rate reductions for capital gains and dividends have further lightened the tax burden on capital income, and international pressure to reduce the …

The Taxation Of Cause-Related Marketing, Terri Lynn Helge

Terri L. Helge

With the economy in turmoil, charitable organizations are looking to nontraditional sources of financing to supplement contributions and fee-based revenues. One potentially lucrative source of revenue stems from cause-related marketing. Cause-related marketing is the public association of a for-profit company with a charitable organization to promote the company’s product or service in order to raise money for the charitable organization. Introduced almost twenty-five years ago, cause-related marketing has now become a $1 billion a year industry. Cause-related marketing has evolved beyond mere use of a charitable organization’s name to an apparent union for the purpose of promoting products that carry …

The Proposed Inheritance Tax And Its Impact On China's Economy, Michael Steve

Michael Steve

No abstract provided.

The Family Llc: A New Approach To Insuring Dynastic Wealth, Evan M. Purcell

Evan M Purcell

No abstract provided.

Definitions, Religion, And Free Exercise Guarantees, Mark Strasser

Mark Strasser

The First Amendment to the United States Constitution protects the free exercise of religion. Non-religious practices do not receive those same protections, which makes the ability to distinguish between religious and non-religious practices important. Regrettably, members of the Court have been unable to agree about how to distinguish the religious from the non-religious—sometimes, the implicit criteria focus on the sincerity of the beliefs, sometimes the strength of the beliefs or the role that they play in an individual’s life, and sometimes the kind of beliefs. In short, the Court has virtually guaranteed an incoherent jurisprudence by sending contradictory signals with …

The Matthew Effect And Federal Taxation, Martin J. Mcmahon Jr.

Martin J. McMahon

The “Matthew Effect” is a synonym for the well-known colloquialism, “the rich get richer and the poor get poorer.” This Article is about the Matthew Effect in the distribution of incomes in the United States and the failure of the federal tax system to address the problem. There has been a strong Matthew Effect in incomes in the United States over the past few decades, with an increasing concentration of income and wealth in the top one percent. Nevertheless, there has been a continuing trend of enacting disproportionately large tax cuts for those at the top of the income pyramid. …

Family Limited Partnerships: Discounts, Options, And Disappearing Value, Karen C. Burke, Grayson M.P. Mccouch

Karen Burke

Family partnerships have been become increasingly popular as a means of avoiding estate and gift taxes. As other estate freezing techniques have been closed off by statutory anti-abuse rules, estate planners have increasingly resorted to partnerships as a vehicle for transferring assets within a family at deeply discounted values. Discounts ranging from one-third to over one-half of the value of the underlying assets are routinely claimed, and often allowed, based on lack of marketability and lack of control, even where these disabilities have no lasting or ascertainable economic effect. Nevertheless, the use of family partnerships to suppress value for transfer …

Family Limited Partnerships: Discounts, Options, And Disappearing Value, Karen C. Burke, Grayson M.P. Mccouch

Grayson McCouch

Family partnerships have been become increasingly popular as a means of avoiding estate and gift taxes. As other estate freezing techniques have been closed off by statutory anti-abuse rules, estate planners have increasingly resorted to partnerships as a vehicle for transferring assets within a family at deeply discounted values. Discounts ranging from one-third to over one-half of the value of the underlying assets are routinely claimed, and often allowed, based on lack of marketability and lack of control, even where these disabilities have no lasting or ascertainable economic effect. Nevertheless, the use of family partnerships to suppress value for transfer …

The Intersection Of Tax And Bankruptcy: The Mccoy Rule, John Ferguson

John Ferguson

No abstract provided.

What's Wrong With A Federal Inheritance Tax?, Wendy Gerzog

Wendy Gerzog

Scholars have proposed a federal inheritance tax as an alternative to the current federal transfer tax system, but there are serious flaws with that idea. Those problems include: (1) different tax rates and exemptions based on the decedent’s relationship to the beneficiary; (2) the lack of a tax on lifetime gratuitous transfers, including gifts with retained interests or control; (3) the persistence of most current valuation distortion abuses; and (4) significantly decreased compliance rates and increased administrative costs inherent in a system that taxes transferees on transactions that may be largely unmonitored.

This article reviews common characteristics of existing inheritance …

What's Wrong With A Federal Inheritance Tax?, Wendy Gerzog

Wendy Gerzog

Scholars have proposed a federal inheritance tax as an alternative to the current federal transfer tax system, but there are serious flaws with that idea. Those problems include: (1) different tax rates and exemptions based on the decedent’s relationship to the beneficiary; (2) the lack of a tax on lifetime gratuitous transfers, including gifts with retained interests or control; (3) the persistence of most current valuation distortion abuses; and (4) significantly decreased compliance rates and increased administrative costs inherent in a system that taxes transferees on transactions that may be largely unmonitored.

This article reviews common characteristics of existing inheritance …

Protecting Those Who Need It Most: A Call For Change To The Tax Application Of Qualified Domestic Relations Orders When Placed Into Special Needs Trusts, Conor Francis Linehan

Conor Francis Linehan

This note calls for a change to the way the Internal Revenue Code is applied towards qualified domestic relations orders when used to fund or partially fund special needs trusts, specifically irrevocable (d)(4)(B) trusts created under § 1396p.

The current status of the law is that an individual can roll over a qualified domestic relations order into a new retirement account in a tax-free transfer. If an individual elects to not roll over into a new retirement fund, some additional exemptions to various early termination penalties and lump sum payments have already been carved out of the Code.

This note …

Occupy The Tax Code: Using The Estate Tax To Reduce Inequality And Spur Economic Growth, James R. Repetti, Paul L. Caron

James R. Repetti

Inequality has been increasing in the United States. We should care about this increase because inequality contributes to a variety of adverse social consequences that persist across generations. There is also substantial empirical evidence that inequality has a long-term negative impact on economic growth. For many decades, federal tax policy has played an important role in reducing inequality, although the impact of federal taxes on inequality has waxed and waned depending on the focus of elected officials. We argue that the estate tax is a particularly apt vehicle to reduce inequality because inheritances are a major source of wealth among …

Occupy The Tax Code: Using The Estate Tax To Reduce Inequality And Spur Economic Growth, James R. Repetti, Paul L. Caron

James R. Repetti

Inequality has been increasing in the United States. We should care about this increase because inequality contributes to a variety of adverse social consequences that persist across generations. There is also substantial empirical evidence that inequality has a long-term negative impact on economic growth. For many decades, federal tax policy has played an important role in reducing inequality, although the impact of federal taxes on inequality has waxed and waned depending on the focus of elected officials. We argue that the estate tax is a particularly apt vehicle to reduce inequality because inheritances are a major source of wealth among …

Occupy The Tax Code: Using The Estate Tax To Reduce Inequality And Spur Economic Growth, James R. Repetti, Paul L. Caron

James R. Repetti

Inequality has been increasing in the United States. We should care about this increase because inequality contributes to a variety of adverse social consequences that persist across generations. There is also substantial empirical evidence that inequality has a long-term negative impact on economic growth. For many decades, federal tax policy has played an important role in reducing inequality, although the impact of federal taxes on inequality has waxed and waned depending on the focus of elected officials. We argue that the estate tax is a particularly apt vehicle to reduce inequality because inheritances are a major source of wealth among …

What’S Wrong With A Federal Inheritance Tax?, Wendy Gerzog

Wendy Gerzog

Scholars have proposed a federal inheritance tax as an alternative to the current federal transfer tax system, but there are serious flaws with that idea. Those problems include: (1) different tax rates and exemptions based on the decedent’s relationship to the beneficiary; (2) the lack of a tax on lifetime gratuitous transfers, including gifts with retained interests or control; (3) the persistence of most current valuation distortion abuses; and (4) significantly decreased compliance rates and increased administrative costs inherent in a system that taxes transferees on transactions that may be largely unmonitored. This article reviews common characteristics of existing inheritance …