Tax Law Commons^™

Thoughts Regarding The Application Of The Step Transaction Doctrine To The Section 351 Control Requirement And Complex Media, Inc. V. Commissioner, Philip G. Cohen

William & Mary Business Law Review

Over thirty years ago, Professor Ronald H. Jensen authored an article in the Virginia Tax Review, titled “Of Form and Substance: Tax Free Incorporations and Other Transactions Under Section 351.” Professor Jensen asserted that it was inappropriate to utilize the step transaction doctrine to determine whether the control requirement was met in a purported section 351 transaction, involving a disposition of some, or all, of the transferor’s shares even if effected by a binding contract made prior to the contribution.

Professor Jensen concluded that the courts and the Internal Revenue Service (Service) have produced a hodgepodge of intellectually inconsistent decisions …

Can Taxes Mitigate Corporate Governance Inefficiencies?, Noam Noked

William & Mary Business Law Review

Policymakers have long viewed tax policy as an instrument to influence and change corporate governance practices. Certain tax rules were enacted to discourage pyramidal business structures and large golden parachutes, and to encourage performance-based compensation. Other proposals, such as imposing higher taxes on excessive executive compensation, have also attracted increasing attention.

Contrary to this view, this Article contends that the ability to effectively mitigate corporate governance inefficiencies through the use of corrective taxes is very limited, and that these taxes may cause more harm than benefit. There are a few reasons for the limited effectiveness of corrective taxes. Importantly, the …

Should Foreign Pension Funds With U.S. Investments Pay U.S. Tax?, Cynthia Blum

William & Mary Business Law Review

U.S. and foreign pension funds are investing heavily outside of their home countries. With the aging of the world’s population, this trend will likely intensify. Most countries, including the U.S., accord a tax exemption to certain qualified pension funds organized within their own country; however, when a foreign pension fund invests in the U.S., the U.S. tax code does not recognize its tax exemption. Responding to the need to attract greater investment in U.S. infrastructure, Congress in 2015 enacted a new provision ameliorating the tax treatment of foreign pension plans investing in U.S. real estate. This Article examines whether the …

The Exit Tax: A Move In The Right Direction, William L. Dentino, Christine Manolakas

William & Mary Business Law Review

Citizenship-based taxation was first enacted during the Civil War, in large part to express congressional disapproval of wealthy individuals who fled abroad to avoid bearing the financial and physical burdens of the war. A century later, motivated by a desire to encourage foreign investment in the United States, Congress passed legislation in 1966 that offered significant tax incentives to nonresident aliens, thereby creating an opportunity for tax abuse. To discourage U.S. citizens from expatriating to avoid U.S. taxation, Congress contemporaneously enacted I.R.C. section 877, which taxes expatriates on certain U.S.-source income for a ten-year period after expatriation. Congress, and the …