Taxation-Federal Commons^™

States Should Quickly Reform Unemployment Insurance, Brian Galle, David Gamage, Erin Scharff, Darien Shanske

Articles by Maurer Faculty

COVID-19 is causing mass layoffs and related economic hardship, as well as budget crises for state and local governments. This article is part of Project SAFE (State Action in Fiscal Emergencies), an academic effort to help states weather the fiscal crisis by providing policy recommendations backed by research. This article will focus on how state governments should reform unemployment insurance (UI) eligibility and benefits and the taxes funding these programs.

Cross-Subsidies: Government's Hidden Pocketbook, John Brooks, Brian Galle, Brendan S. Maher

Faculty Scholarship

Governments can use regulation to pay for public goods out of the pockets of consumers, rather than taxpayers. For example, the Affordable Care Act underwrites care for women and the infirm through higher insurance premium payments by healthy men. Building on a classic article from Richard Posner, we show that these “cross-subsidies” between consumers are a common feature of modern law, ranging from telecommunications to intellectual property to employee benefits.

Critics of the ACA, and even some of its supporters, argue that taxes would be a better choice. Taxes are said to be more transparent, and to fit better with …

The Future Of The Cadillac Tax, Kathryn L. Moore

Law Faculty Scholarly Articles

The Affordable Care Act includes a 40 percent excise tax on high-cost employer-sponsored health care coverage. Often referred to as the “Cadillac tax,” this excise tax is one of the most controversial elements of the Affordable Care Act.

Currently scheduled to go into effect in 2020, the Cadillac tax poses serious challenges and uncertainty for employers. On the one hand, recent estimates suggest that the Cadillac tax may hit as many as 20 percent of employers with health care plans in 2020. On the other hand, there is a serious question as to whether the tax will be repealed before …

Fiscal Federalism As Risk-Sharing: The Insurance Role Of Redistributive Taxation, John R. Brooks

Georgetown Law Faculty Publications and Other Works

In addition to funding government and redistributing income, a redistributive tax-and-transfer system, and a progressive income tax in particular, provides insurance against the risk of uncertain future income. By providing for high taxes for high incomes, and low taxes, exemptions, and transfers for low incomes, a progressive income tax lowers the volatility of potential after-tax income relative to a lump-sum tax. This insurance function is distinct from the redistributive function of the system, since it provides a direct risk-mitigation benefit to the taxpayer himself, rather than simply redistributing income from one taxpayer to another.

This article analyzes the question of …

Using Payroll Deduction To Shelter Individual Health Insurance From Income Tax, David Orentlicher

Scholarly Works

In this article, Professor Orentlicher and his colleagues assess the impact of state laws requiring or encouraging employers to establish ‘‘section 125’’ cafeteria plans that shelter employees’ premium contributions from tax.

Justifying The Exclusion Of Insurance, Jeffrey H. Kahn

Scholarly Publications

No abstract provided.

Taxing Risk: An Approach To Variable Insurance Reform, Charlene Luke

UF Law Faculty Publications

Variable life insurance and annuity contracts are susceptible to being marketed and sold to taxpayers for whom such contracts are unsuitable and to being used in wraparound insurance shelters. As a method of addressing these problems, I propose current taxation for the risky returns on these contracts but continued deferral for a deemed, risk-free return amount. The increased transparency resulting from the forced separate tax accounting of contract components should improve consumers' ability to receive adequate suitability evaluations and may also lead to lower fees. Current taxation of risk-related returns removes an apparently key shelter incentive and should make it …

Tax Consequences Of Assigning Life Insurance - Time For Another Look, Douglas A. Kahn, Lawrence W. Waggoner

Articles

The Taxpayer Relief Act of 1997 furnishes the courts and the Internal Revenue Service an opportunity to close certain loopholes in the federal tax consequences of assigning life insurance. About twenty years ago, we published an article arguing that the tax consequences of assigning life insurance affords taxpayers unwarranted opportunities for tax avoidance. Since then, developments in the case law and Internal Revenue Service rulings have broadened the loopholes. In the update of our article, we show how the new tax law supports our original position.

Toward A Tax-Based Explanation Of The Liability Insurance Crisis, Kyle D. Logue

Articles

The so-called liability insurance crisis of 1985 and 1986 transformed the way we think about tort law and about liability insurance markets. The crisis phenomena, which first appeared in late 1984 and lasted until mid-1986, consisted of enormous increases in liability insurance premiums and alarming reductions in the availability of certain types of liability coverage. In the two principal liability lines of insurance (Other Liability and Medical Malpractice), premiums increased by hundreds (in some cases thousands) of percentage points in a matter of months. At the same time, the availability of liability insurance contracted sharply. The liability policies that were …

Death And Taxes: The Taxation Of Accelerated Death Benefits For The Terminally Ill, Wayne M. Gazur

Publications

No abstract provided.

Taxing Personal Insurance: The Case Of Tax Audit Insurance, William D. Popkin

Articles by Maurer Faculty

No abstract provided.

Federal Taxation Of The Assignment Of Life Insurance, Douglas A. Kahn, Lawrence W. Waggoner

Articles

The most litigated estate tax issue concerning life insurance is whether the proceeds should be included in the insured's gross estate. This question usually is governed by section 2042 of the Internal Revenue Code of 1954, the estate tax provision directed specifically at life insurance. While the Tax Reform Act of 1976 wrought enormous changes in many areas of estate taxation, Congress did not change section 2042. Thus the several unresolved questions concerning the interpretation of that section remain unsettled. But the question of the includability of life insurance proceeds in the gross estate of the insured is not always …