Law Commons^™

Partnership Tax Provisions Of The Tcja As Illustrations Of Planning Simplification Versus Compliance Simplification Trade-Offs, Emily Cauble

Pepperdine Law Review

Oftentimes, efforts to simplify the process of reporting the tax consequences of events that have already occurred exacerbate complexity faced by taxpayers at the stage in time when they are deciding how to act. Efforts to simplify reporting include, for instance, provisions that obviate the need to value assets prior to their sale or methods for determining tax consequences that reduce the number of computational steps used when determining tax liability. While such efforts may, to a degree, simplify tax compliance, they can also set traps for unwary taxpayers at the planning stage. Avoiding asset valuation or taking short-cuts when …

Taxing The Ivory Tower: Evaluating The Excise Tax On University Endowments, Jennifer Bird-Pollan

Pepperdine Law Review

The Tax Cuts and Jobs Act of 2017 introduced the first-ever excise tax imposed on the investment income of university endowments. While it is a relatively small tax, this new law is a first step towards the exploration of taxing non-profit entities on the vast sums of wealth they hold in their endowments. In this essay I take the new tax as a starting place for investigating the justification for tax exemption for universities and thinking through the consequences of changing our approach, both in the form of the new excise tax and possible alternatives. There remain reasons to be …

May The Odds Be Ever In Your Favor: How The Tax Cuts And Jobs Act Fortified The Great Wealth Divide, Phyllis Taite

Pepperdine Law Review

Have Americans become so desensitized to inequality that we have morphed into a state of dystopia, and vast inequalities have become normalized? Discussions of dystopia typically describe acts of oppression, tyranny, inequality, and an overall undesirable societal state. Dystopia analysis also requires a hard look at societal values to determine ways to avoid adverse outcomes that vast inequalities may produce. By identifying the undesirable outcome, there is an opportunity to avoid or reverse it by enacting laws to combat inequalities. The Hunger Games is a fictional tale of wealthy society members enjoying the rewards of high society while using the …

A Gilti Fix For An Employment Tax Glitch, Richard Winchester

Pepperdine Law Review

Self-employed individuals who operate through a business entity can often dictate how much employment tax they pay, if any. That’s because the rules permit them to control whether their earnings count as labor income – which is subject to employment tax – or the returns on any capital invested in their business – which is not subject to the tax. The GILTI rules enacted as part of the 2017 Tax Act assume that capital investments generally earn a 10 percent annual rate of return. That same assumption can be used to allocate the earnings of a self-employed individual between the …

Intent, Inequality, And The Berlin Walls Of The Mind, Bobby L. Dexter

Pepperdine Law Review

Although acknowledging that various provisions in the Tax Cuts and Jobs Act of 2017 appear responsive to normative arguments presented in tax literature, this article posits that, true to its core intent, the law aggressively advanced the persistent effort to shift the tax burden away from the nation’s wealthiest citizens to the great bulk of taxpayers of more modest financial means. Thus, those with political power successfully employed the tax law to protect, preserve, and enhance prevailing wealth and income inequality. With the election of President Joe Biden and the assumption of Democratic control in both chambers of Congress, however, …

Comparing Capital Income And Wealth Taxes, Ari Glogower

Pepperdine Law Review

As part of the Pepperdine Law Review Symposium The Impact of the 2017 Tax Act on Income and Wealth Inequality: Lessons for 2020 and Beyond, this Essay compares two reform directions to rebuild the progressive tax system: an improved capital income tax—which would eliminate the benefit from deferring gains until a sale—or a wealth tax. The Essay first introduces the concept of a “rate-equivalent” wealth or capital income tax as a way to assess reform alternatives consistently and to identify the assumptions as to how the reforms would be structured. For any chosen capital income tax (or wealth tax) reform, …

It’S All About The Drd, What’S Wrong With Foreign Branches, And A Few Other Things You Should Know About The New International Tax Provisions, Rebecca Rosenberg

Loyola of Los Angeles Law Review

This Article highlights and analyzes some important points about the new international tax rules. For example, such provisions do not create an entirely territorial system. The partial movement towards territorial objectives is accomplished largely through the new 100% dividends received deduction (DRD) for certain foreign dividends from foreign corporations. However, this new DRD is much more limited in its application than most taxpayers may realize (for example, due to a very long holding period requirement). Even when the DRD potentially applies, taxpayers may attempt to claim foreign tax credits instead.

In addition, some of the new tax provisions show a …

United States Policy And The Taxation Of International Intangible Income, Stanley I. Langbein

University of Miami Inter-American Law Review

No abstract provided.

Tax 2018: Requiem For Ability To Pay, Alice G. Abreu

Loyola of Los Angeles Law Review

Enactment of the TCJA was followed by a mad dash to understand its effects. The speed and process of enactment left no time for serious attempts to analyze whether the TCJA transforms the income tax system in any fundamental way. This Essay is a first step in that analysis. Although some of the most important changes I discuss are set to expire or phase out after 2025, understanding their policy implications is important, not only because they are the law now but also because Congress may extend them, perhaps indefinitely.

The TCJA has changed the way the tax system operationalizes …

The Death Of The Income Tax (Or, The Rise Of America’S Universal Wage Tax), Edward J. Mccaffery

Indiana Law Journal

The killing of the income tax has not been open and notorious: such is not the style of contemporary politics. As with other markers of progressive social policy—the promises of universal health care, Obamacare, come to mind6—the income tax is dying a death by stealth, albeit stealth played out in plain view. The plot lines of the tragedy are apparent. The individual “income” tax has been split in two. One tax, for the masses, is a simple, increasingly formless wage tax. This wage/income tax adds higher brackets onto the payroll tax, the model toward which the wage/income tax aims, to …