Tax Law Commons^™

A Philosophy Toolkit For Tax Lawyers, Bret N. Bogenschneider

Akron Law Review

Philosophy functions as a tool for tax lawyers.The various schools of philosophy are akin to a toolkit with different tools suited for differing projects where the more tools the tax lawyer knows how to use, the more effective he or she will be in the practice of tax law. This paper accordingly sets out to provide a systemization of philosophy relevant to tax law in the areas of Moral Philosophy, Legal Philosophy, Law and Economics, Philosophy of Science, Philosophy of Mind, Philosophy of Language, and Critical Legal Studies. A summary is provided of each followed by a discussion of prior …

"Cut - And That's A Wrap" - The Film Industry's Fleecing Of State Tax Incentive Programs, Randle B. Pollard

Akron Law Review

When film production costs in California skyrocketed in the 1990s, states began creating tax incentive programs to attract film industry production. Currently, thirty-seven states have some type of film industry incentives and twenty-two states offer film tax credits. The 2014 movie Divergent, based on a science fiction book trilogy that takes place in a future post-apocalypse Chicago, cost $85 million to create, $30 million of which was spent in Illinois. The film producers promised to produce 1,000 jobs and in return received over $5 million in Illinois film tax credits. Did the reduction of tax revenue collected by the state …

Tax Treaty Models - Past, Present, And A Suggested Future, Doron Narotzki

Akron Law Review

Most scholarly research on tax treaties deals with the question of whether tax treaties are essentially necessary and how they work to eliminate double taxation, attract foreign direct investments, and promote the exchange of information. Although these questions are important, each of them treats one specific aspect of tax treaties in a way that can be described as, at best, speculative. That specific aspect is the tax policy a country wishes to implement in each tax treaty. Although everyone assumes a policy exists, no one actually knows what the policy is or any other details regarding it. All too often, …

All Is Whale That Ends Whale? The Deficiencies In National Protection For Orca Whales In Captivity, Hillary T. Wise

Akron Law Review

With the severity of our Earth’s climate change crisis, this article endeavors to underline the critical need for environmental reformation. It is no secret that orca whales epitomize miraculous intelligence, gentility, and strength. As overwhelming as this crisis might be, there are very concrete steps that our legal system can take to begin protecting and making a difference for our whales and our Earth. It is my hope that this article can shed some light on what is at stake for these animals, and how we might move forward toward a sustainable, safe future for them.

Getting Back To The "Grassroots" Of Tax Administration: Because "We The People" Long For A Gathering Of American Eagles To Restore Trust In The Internal Revenue Service With A Rebuild Irs Initiative, Frank Wolpe

Akron Law Review

Like America, our Internal Revenue Service is a work in progress. Yet, for best results, it’s better to avoid thinking too much about what it is or is not! Instead, let’s think more about what the IRS ought to be! This Article thusly offers a realistic path forward with new choices for a local presence, which once again makes it taxpayer/customer-centric. For more effective tax administration, it also offers a return to something that inexcusably went missing in 1998: senior-executive “on-site oversight” of field operations.

If today’s Internal Revenue Service can be fairly described as an exploding volcano …

The Quagmire Of Mortgage Short Sale Transactions Under Current Homeownership Tax Policy In A Time Of Crisis, Tracie R. Porter

Akron Law Review

The 2007 financial crisis continues to loom over homeowners who own underwater properties. What owning underwater property means for homeowners is that the home’s current market value is less than the mortgage balance, making it impossible to sell or refinance the home without the lender’s approval. The quagmire of financial indebtedness created by current tax laws and policy related to Mortgage Short Sale Transactions, or MSSTs, for homeowners creates an onerous tax liability on taxpayers selling underwater properties. The government and lenders, through various programs implemented to help distressed homeowners with underwater properties, created a belief among homeowners that MSSTs …

Northwestern, O'Bannon And The Future: Cultivating A New Era For Taxing Qualified Scholarships, Kathryn Kisska-Schulze, Adam Epstein

Akron Law Review

On March 26, 2014, the National Labor Relations Board (NLRB) ruled that Northwestern University’s scholarship football players were employees of the institution and could unionize and bargain collectively. From a federal income tax perspective, the significance of the NLRB decision—at that time—was that it could redefine the principle that select student-athletes are no longer unpaid amateurs receiving qualified scholarships, but instead are employees of their institutions, earning scholarship funds in exchange for services rendered as college athletes. Accordingly, a crucial question arising from the NLRB holding was whether the Internal Revenue Service could logically continue to treat qualified scholarships received …

Schoppe V. Commissioner: The Federal Circuit Split Regarding The Application Of The Automatic Stay Provision Of 11 U.S.C. § 362(A)(1) To Appeals From The United States Tax Court, Nathaniel Tucker

Akron Law Review

Part II of this Note establishes the background of the automatic stay which exists in bankruptcy law under 11 U.S.C. § 362(a)(1). It examines the purpose of the automatic stay and how its scope is very broad and applicable to many different proceedings. Further, this part discusses how the automatic stay applies to tax deficiencies, and it examines the federal circuit court split regarding the applicability of the automatic stay to appeals from Tax Court. Part III presents a factual and procedural history of the most recent circuit court decision regarding this matter, Schoppe v. Commissioner, which the Tenth Circuit …

Distinguishing Deductible Repairs From Capitalized Improvements: An Expectations Approach To The New Repair Regulations, George Mundstock, Thomas J. Korge

Akron Law Review

This Article explores an economic model of the business use of assets that supports an expectations approach to distinguishing between immediately deductible repairs and capitalized improvements. Under an expectations approach, the classification of an activity as a repair or a capital improvement depends on the taxpayer’s reasonable expectation when first placing the depreciable property in service—whether, upon acquisition of the property, the taxpayer reasonably expected the activity to be required in the future to keep the property operating in its ordinarily efficient operating condition. Many of the rules provided by the new regulations are consistent with this approach. The inconsistent …

The Same Sex Marriage Tax Shelter: What's Love Got To Do With It?, Stephen T. Black

Akron Law Review

This Article examines how wide, and asks whether the tax planning opportunities post-Windsor threaten the stability of the tax system and the stability of marriage. Part II of this Article discusses the federal tax benefits married couples receive when treated as a single economic unit. In Part III, the Article examines the use of partnerships and marriages to attain tax benefits for the parties involved. Next, Part IV discusses the possibility of tax shelter opportunities through the use of multiparty marriages, which are now possible in light of the Windsor decision. Finally, Part V concludes.

Bogus Refunds & Bad Penalties: The Feckless And Fixable Refund Penalty System, Del Wright Jr.

Akron Law Review

This Article analyzes the problems with section 6676 as it currently applies and offers suggestions to change it. The Article begins by identifying the reasons section 6676 has been unable to accomplish its policy goals and then highlights problems on the horizon. It ends by suggesting legislative and regulatory changes that will ameliorate the problems with section 6676 and allow the law to accomplish the goals Congress sought to achieve through its enactment. Part II of this Article lays out the problems associated with erroneous claims for refund and past legislative attempts to deal with the problem, ultimately leading to …

Better Late Than Never: Incorporating Llcs Into Section 4943, Elaine Waterhouse Wilson

Akron Law Review

Part I of this Article traces the historical development of Code Section 4943 and the business entanglement issues that the Code Section was designed to combat. It then discusses developments in the law that occurred after the passage of Section 4943 that have implications for its structure, most importantly the introduction of the LLC. Part II describes the current statutory scheme of Section 4943, and the ambiguity in the manner in which it applies, and the practical problems and abuses that potentially arise from this ambiguity. In Part III, the Article reviews various options for clarifying the treatment of Section …

Untangling The Strings: Transfer Taxation Of Retained Interests And Powers, Matthew A. Reiber

Akron Law Review

This Article takes a more sanguine approach: it acknowledges the utility of certain portions of these provisions to a functioning transfer tax system, but ultimately concludes that the current statutory scheme is overbroad in reach, clumsy in application, and therefore should be replaced with a single, stand-alone provision. Such a provision would require inclusion of property irrevocably transferred during life in which (a) the transferor retains an economic interest in the property, such as the right to use the property or to receive the income generated by the property, (b) the transferor pays gift tax at the time of transfer …

Tax Incidents Of Private Annuities, Richard L. Grant

Akron Law Review

One can best describe a private annuity by stating what it is not: It is not purchased from a commercial underwriter, but from a person, who, in the ordinary course of his business, does not write annuity contracts. It does not contain a secured promise to perform. In all other respects, the private annuity resembles commercial annuities in that the annuitant transfers cash or other property in exchange for a promise of the transferee (obligor) to make periodic payments of money either for a term of years or for the life of the annuitant. One writer' would fragment such a …

Equal Protection - Property Taxes As A Method Of Funding Public Education; San Antonio Independent School District V. Rodriguez, Mark K. Croft

Akron Law Review

Suit was brought in U.S. District Court for the Western District of Texas challenging the constitutionality of the Texas school financing system on the theory that it discriminated on a basis of wealth, permitting provision of a higher quality of education to be offered the children in property-rich school districts while residents pay a lower tax rate, thus denying equal protection of the law.' The District Court found the laws forming this system unconstitutional on this basis. Appeal brought the case to the Supreme Court in October of 1972, where it was reversed.

Income Tax Considerations In The Transition To A Professional Corporation, Harvey Dunn

Akron Law Review

[T]he tax considerations in the formation and operation of a professional corporation are numerous and, unfortunately, there are many areas which lack definite guidelines so as to enable the practitioner to give as definite an answer as he would like to. However, as with any new area of tax law, it will take time, decisions and rulings to develop what one may term as reasonable guidelines for reaching a conclusion. In the meantime, there is little doubt that with careful planning in the formative stages and close observation of the operation of a professional corporation, the risk of problems with …

Employee Medical Reimbursement Plans In The Age Of Erisa, Robert D. Rosewater

Akron Law Review

THE EMPLOYEE MEDICAL reimbursement plan presents a new dimension in the spectrum of available corporate fringe benefits. Its attractiveness lies in the relative ease by which the plan may be adopted and administered as well as the favorable federal income tax consequences to both the corporation and its participating employees. These plans undoubtedly will proliferate as other traditional fringe benefits become less attractive due to changes in tax laws,2 as medical expenses continue to increase, and as the advantages of employee medical reimbursement plans become more widely known. The scope of this article is to discuss the purposes of these …

Federal Income Tax Developments: 1975

Akron Law Review

FEDERAL INCOME TAX DEVELOPMENTS: 1975 is the third of an annual series of articles to be published in the Winter Issue of the Akron LAW REVIEW. The thrust of this article is not only to identify the new developments, but also to trace these concepts through their formative stages. The area of concentration for this article includes cases decided through September 30, 1975. Given the volatile nature of taxation, it is crucial for the practitioner in this field to remain current with the changes which have occurred during the tax year. The purpose of this article is to highlight for …

Trading With Related Foreign Entitites: Current American Tax Perspective, Mortimer Caplin

Akron Law Review

This article attempts to summarize existing United States tax law and government policy on arm's-length dealing, with the hope that it will illuminate the current perspective in this important and complex area

The Business Purpose Doctrine In Corporate Divisions, Stephen Rigsby

Akron Law Review

The corporate division, however, lends itself to schemes for avoidance of tax. These schemes are attempts to convert ordinary income into income taxable at capital gains rates. An elaborate statutory mechanism has been created to prevent this conversion. In addition, the courts have created judicial doctrines which sometimes work by adding to the statutory framework and sometimes overlap. The resulting confusion of statute and judicial doctrine is the subject of this article. The investigation will focus on that part of the statute known as the device clause and its interaction with the judicial doctrines which together are known as the …

Federal Income Tax Developments: 1977

Akron Law Review

The thrust of this article is not only to identify the new developments, but also to trace these concepts through their formulative changes. This article covers the new developments in the case law including those cases and rulings implementing the Tax Reform Act of 1976.

Federal Income Tax Developments: 1978

Akron Law Review

FEDERAL INCOME TAX DEVELOPMENTS: 1978 is the sixth of an annual series of articles to be published in the AKRON LAW REVIEW. The scope of this survey is limited to the substantive developments in the field of income taxation. The thrust of this article is not only to identify new developments, but also to trace these concepts through their formulative changes.

Sales Taxation Of Mixed Transactions In Ohio: A Proposal To End The Turmoil, Gregory L. Petersen

Akron Law Review

This note will examine Ohio's statutory framework for the exemption of personal service transactions from sales taxation in light of judicial developments and the Tax Commissioner's interpretations. The analysis begins with whether a mixed transaction, one involving personal service and tangible personal property, is subject in its entirety to sales taxation only because a small amount of personal property was included. Then the advantages and disadvantages of separating personal service and personal property expenses will be examined. There the taxpayer would charge the client sales tax for the personal property portion of the transaction, but not for the personal service …

Nontaxpayer Suits: Seeking Injunctive And Declaratory Relief Against Irs Administrative Action, John A. Lynch

Akron Law Review

Who should be entitled to challenge Internal Revenue Service (IRS) tax policy decision making? Should the concerned citizen or the aggrieved competitor of a company receiving favorable treatment from the IRS be precluded from seeking review of allegedly illegal action when his own taxes are not specifically involved? ...

It is clear from an analysis of recent decisions that several federal courts have been unwilling to accept the proposition that the Anti-Injunction Act and the Declaratory Judgment Act exception insulate the IRS from judicial scrutiny even when judicial intervention would pose no threat to federal revenues. An analysis of the …

Unreasonable Compensation In The Professional Corporation, Vincent J. Falcone

Akron Law Review

This comment will discuss the federal income tax issue of unreasonable compensation as it affects the incorporated professional. Discussion will first center on the modus operandi of the professional corporation, and how the compensation issue arises. Unreasonable compensation will then be defined and explained in that context. Next, the actual considerations used in determining whether compensation is excessive or not will be discussed. Then, the additional requirement that the remuneration be compensation in fact, and not a return on investment, will be investigated. The applicability of the 50% maximum tax on personal service income will also be analyzed. Finally, some …

Federal Income Tax Developments: 1979

Akron Law Review

The scope of this survey is limited to the substantive developments in the field of income taxation. The thrust of this article is not only to identify new developments, but also to trace these concepts through their formulative changes

Federal Income Tax Developments: 1980

Akron Law Review

The scope of this survey is limited to the substantive developments in the field of income taxation. The thrust of this article is not only to identify new developments, but also to trace these concepts through their formulative changes.

An Examination Of The Current Ohio Condominium Law, Patricia Mcquillen Billow

Akron Law Review

Ohio sanctioned condominiums in 1963 by enacting the Condominium Property Act. The act addresses five issues: (1) the creation of the condominium form of ownership; (2) the respective interests each unit owner possesses in the common area; (3) the administration of the condominium; (4) the rights of the lienors; and, (5) the removal of the property from the Act's provisions. The Act was amended in 1978 to facilitate consumer protection. This comment will examine the 1978 amendment and evaluate its effectiveness. It will then examine the tax considerations involved in the purchase of a condominium unit.

Application Of Computer-Assisted Analysis Techniques To Taxation, Richard J. Kovach

Akron Law Review

Thus, it may be useful at this early point in the development of computer-assisted legal analysis to speculate on the full potential for computer applications to taxation in light of the analytic complexities commonly encountered in tax work.

Search: A Computer Program For Legal Problem Solving, Robert Hellawell

Akron Law Review

This article describes a computer program called SEARCH which is designed to assist a lawyer in legal analysis. SEARCH deals with a single subject in corporate taxation, but its approach can be used for a variety of legal problems. SEARCH's subject is the attribution rules of section 318 of the Internal Revenue Code (hereinafter Code). These rules, heartily disliked by many, are seemingly complex and often both difficult and time consuming to apply. Essentially, the attribution rules provide that a taxpayer, in certain cases, will be considered to own corporate shares that he does not actually own. Such shares are …