Tax Law Commons^™

Corporate Distributions And The Income Tax: A Consideration Of The Inconsistency Between Subchapter C And Its Underlying Policy, Charles R.T. O'Kelley

Scholarly Works

This Article suggests that although one part of a corporate distribution may be analogous to a sale and the remainder to a dividend, there is no overlap of, or competition between, analogies. This lack of overlap is apparent when one realizes that a dividend and a sale are methods of realizing different types of gain, rather than alternative methods of realizing the same type of gain. This Article examines the basic conceptual model underlying the present system of taxing corporate distributions, describes the appropriate treatment of corporate distributions that is suggested by an understanding of the underlying concepts, and indicates …

State Income Taxation Of Multijurisdictional Corporations: Reflections On Mobil, Exxon, And H.R. 5076, Walter Hellerstein

Scholarly Works

The state tax field is enjoying a renaissance of sorts. The Supreme Court has displayed a renewed interest in the area, handing down an unusual number of significant decisions addressed to the constitutional restraints on state tax power. State courts have exhibited a similar revival of interest in these problems through an out-pouring of uncharacteristically thoughtful opinions concerning state taxation of multistate and multinational enterprise. Congress, whose concern with state taxation of interstate and foreign commerce has been sporadic, is again considering legislation that would limit state taxing authority in these domains.

Even the executive branch, which seldom intervenes in …

State Income Taxation Of Multijurisdictional Corporations: Reflections On Mobil, Exxon, And H.R. 5076, Walter Hellerstein

Scholarly Works

The state tax field is experiencing a renaissance of sorts. The Supreme court has displayed a renewed interest in the area, handing down an unusual number of significant decisions addressed to the constitutional restraints on state tax power. State courts have exhibited a similar revival of interest in these problems through an outpouring of uncharacteristically thoughtful opinions concerning state taxation of multistate and multinational enterprise. Congress, whose concern with state taxation of interstate and foreign commerce has been sporadic, is again considering legislation that would limit state taxing authority in these domains. Even the executive branch, which seldom intervenes in …

Hughes V. Oklahoma: The Court, The Commerce Clause, And State Control Of Natural Resources, Walter Hellerstein

Scholarly Works

The Supreme Court's recent Commerce Clause opinions reflect an apparent effort to rationalize and modernize the analytical framework for delineating the implied restraints that the Clause imposes on state legislation. In the state tax field, the Court has articulated a coherent set of criteria controlling the validity of state taxes on interstate commerce and has discarded doctrine inconsistent with these standards. In the state regulatory context, the Court has likewise enunciated meaningful decisional principles governing the constitutionality of state regulations affecting interstate commerce and has applied them without substantial concern for their impact on its precedents of an earlier era. …

Construing The Uniform Division Of Income For Tax Purposes Act: Reflections On The Illinois Supreme Courts Reading Of The "Throwback" Rule, Walter Hellerstein

Scholarly Works

Part I of this article examines the structure and underlying policy of the Uniform Division of income for Tax Purposes Act's provisions relating to the apportionment of income arising from economic activity conducted across state lines. In particular, it considers the Act's "throwback" rule, which reapportions income ordinarily apportioned to a state in which it is not taxable to one in which it is. Part II explores in detail the Illinois court's resolution of the problem raised by GTE, namely, how to assign sales of tangible personal property, which are used as a basis for apportioning income, when such sales …

State Taxation And The Supreme Court: Toward A More Unified Approach To Constitutional Adjudication?, Walter Hellerstein

Scholarly Works

The Supreme Court's decisions delineating the constitutional limitations on state tax power have often defied rational analysis. The Court read the commerce clause as forbidding a state tax on the privilege of doing interstate business but not on the privilege of doing interstate business in corporate form. It construed the import-export clause as prohibiting a state tax on bales of imported hemp awaiting use in manufacturing but not on piles of imported ore and plywood awaiting such use. It interpreted the supremacy clause as barring a state tax upon the sale of goods to one government contractor but not to …

State Taxation And The Supreme Court: Toward A More Unified Approach To Constitutional Adjudication?, Walter Hellerstein

Scholarly Works

The Supreme Court's decisions delineating the constitutional limitations on state tax power have often defied rational analysis. The Court read the commerce clause as forbidding a state tax on the privilege of doing interstate business but not on the privilege of doing interstate business in corporate form. It construed the import-export clause as prohibiting a state tax on bales of imported hemp awaiting use in manufacturing but not on piles of imported ore and plywood awaiting such use. It interpreted the supremacy clause as barring a state tax upon the sale of goods to one government contractor but not to …

State Taxation Of Interstate Business And The Supreme Court, 1974 Term: Standard Pressed Steel And Colonial Pipeline, Walter Hellerstein

Scholarly Works

It was an item of more than routine interest when the Supreme Court, late in the 1973 term, noted probable jurisdiction in two cases raising issues of central importance with respect to state tax power over interstate business. Standard Pressed Steel Co. v. Department of Revenue presented critical questions concerning due process and commerce clause limitations on a state's power to impose an unapportioned gross receipts tax on an interstate vendor; Colonial Pipeline Co. v. Traigle posed the recurring and unresolved question of the scope and vitality of the doctrine that the “privilege” of doing interstate business is immune from …

Michelin Tire Corp. V. Wages: Enhanced State Power To Tax Imports, Walter Hellerstein

Scholarly Works

In Michelin Tire Corp. v. Wages, the Supreme Court abandoned a century of precedent in holding that the Import-Export Clause does not bar a state from imposing a nondiscriminatory ad valorem property tax on imported goods. The provision forbidding the states from laying "any Imposts or Duties on Imports or Exports" was never intended to prohibit such a levy, the Court now tells us, and the case first suggesting that it did, Low v. Austin, was "wrong decided." Over a mild protest of Mr. Justice White, the Court thus obviated any examination of the principal issue the parties …

Some Reflections On The State Taxation Of A Nonresident's Personal Income, Walter Hellerstein

Scholarly Works

With respect to the taxation of personal income, it was plain by 1940 that states were constitutionally free to tax residents on all personal income wherever earned and nonresidents on personal income earned within the state, even though these two principles, taken together, meant that an individual's income might be subject to double-taxation by different states. The Supreme Court, after toying with the idea for a decade, finally rejected the invitation to forge the due process clause into a tool for preventing multiple taxation and reverted to the ruling law of an earlier era that left the solution of such …

Some Reflections On The State Taxation Of A Nonresident's Personal Income, Walter Hellerstein

Scholarly Works

With respect to the taxation of personal income, it was plain by 1940 that states were constitutionally free to tax residents on all personal income wherever earned and nonresidents on personal income earned within the state, even though these two principles, taken together, meant that an individual's income might be subject to "double-taxation" by different states. The Court, after toying with the idea for a decade, finally rejected the invitation to forge the due process clause into a tool for preventing multiple taxation and reverted to the ruling law of an earlier era that left the solution of such problems …

Tax Significance Of Payments In Satisfaction Of Liabilities Arising Under Section 16(B) Of The Securities Exchange Act Of 1934, Lawrence Lokken

Scholarly Works

This article examines the income tax significance to the insider of his payment in satisfaction of a liability arising under section 16(b). Such taxpayers have usually sought a deduction against ordinary income in the year of payment. When the issue was first raised, the deduction was denied. Section 16(b) liability was held to be in the nature of a penalty; allowance of the deduction, it was found, "would weaken an effective method of enforcing the sharply defined policy expressed in sectin 16(b)...." In 1961 the Internal Revenue Service modified its earlier position by ruling that section 16(b) is not a …