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Full-Text Articles in Law

A Gilti Fix For An Employment Tax Glitch, Richard Winchester Sep 2021

A Gilti Fix For An Employment Tax Glitch, Richard Winchester

Pepperdine Law Review

This Article will describe in greater detail the basic contours of such a reform. Before doing so, Part II describes the existing employment tax rules, focusing on the various ways they apply to a self-employed individual. Part III explains how certain self-employed individuals can use the rules to limit their employment tax base and the tax they owe. Part IV describes the distortions and inequities that are produced under the current employment tax rules. Part V recounts legislative efforts to isolate labor income and shows how those efforts came to bear fruit in the GILTI rules and elsewhere in the ...


A Constitutional Wealth Tax, Ari Glogower Apr 2020

A Constitutional Wealth Tax, Ari Glogower

Michigan Law Review

Policymakers and scholars are giving serious consideration to a federal wealth tax. Wealth taxation could address the harms from rising economic inequality, promote equality of social and economic opportunity, and raise the revenue needed to fund critical government programs. These reasons for taxing wealth may not matter, however, if a federal wealth tax is unconstitutional.

Scholars debate whether a tax on a wealth base (a “traditional wealth tax”) would be a “direct tax” subject to apportionment among the states by population. This Article argues, in contrast, that this possible constitutional restriction on a traditional wealth tax may not matter. If ...


Does Capital Bear The U.S. Corporate Tax After All? New Evidence From Corporate Tax Returns, Edward Fox Mar 2020

Does Capital Bear The U.S. Corporate Tax After All? New Evidence From Corporate Tax Returns, Edward Fox

Articles

This article uses U.S. corporate tax return data to assess how government revenue would have changed if, over the period 1957–2013, corporations had been subject to a hypothetical corporate cash flow tax—that is, a tax allowing for the immediate deduction of investments in long-lived assets like equipment and structures—rather than the corporate tax regime actually in effect. Holding taxpayer behavior fixed, the data indicate actual corporate tax revenue over the most recent period (1995–2013) differed little from that under the hypothetical cash flow tax. This result has three important implications. First, capital owners appear to ...


The Games They Will Play: Tax Games, Roadblocks, And Glitches Under The 2017 Tax Legislation, David Kamin, David Gamage, Ari Glogower, Rebecca Kysar, Darien Shanske, Reuven S. Avi-Yonah, Lily Batchelder, J. Clifton Fleming, Daniel Hemel, Mitchell Kane, David Miller, Daniel Shaviro, Manoj Viswanathan Feb 2019

The Games They Will Play: Tax Games, Roadblocks, And Glitches Under The 2017 Tax Legislation, David Kamin, David Gamage, Ari Glogower, Rebecca Kysar, Darien Shanske, Reuven S. Avi-Yonah, Lily Batchelder, J. Clifton Fleming, Daniel Hemel, Mitchell Kane, David Miller, Daniel Shaviro, Manoj Viswanathan

Articles

The 2017 tax legislation brought sweeping changes to the rules for taxing individuals and business, the deductibility of state and local taxes, and the international tax regime. The complex legislation was drafted and passed through a rushed and secretive process intended to limit public comment on one of the most consequential pieces of domestic policy enacted in recent history. This Article is an effort to supply the analysis and deliberation that should have accompanied the bill’s consideration and passage, and describes key problem areas in the new legislation. Many of the new changes fundamentally undermine the integrity of the ...


The Religious Roots Of The Progressive Income Tax In America, Joshua Cutler Jan 2019

The Religious Roots Of The Progressive Income Tax In America, Joshua Cutler

Catholic University Law Review

I examine the debate over the first peacetime income tax in the United States in 1894 to investigate the role of religion in enacting the tax and providing moral legitimacy. I find that congressional proponents repeatedly and explicitly argued that a progressive income tax was a biblical tax that best conformed to Judeo-Christian teachings on economics and fundraising. I discuss the history of American religious fundraising practices, including the trend leading up to 1894 that advocated for proportionate giving of income as the best method of giving, as well as the related tithing movement. I document that congressional income tax ...


Beps, Atap, And The New Tax Dialogue: "A Transatlantic Competition?", Reuven Avi-Yonah, Gianluca Mazzoni Sep 2018

Beps, Atap, And The New Tax Dialogue: "A Transatlantic Competition?", Reuven Avi-Yonah, Gianluca Mazzoni

Articles

Since its launch in 2013, the US actively participated in all aspects of the BEPS project. However, until recently, the general view was that following the conclusion of the BEPS negotiations and the change of Administration the US is stepping back from the BEPS process. While the EU was charging ahead with implementing BEPS through the Anti-Tax Avoidance Directive (ATAD), the US stated that it was already in compliance with all BEPS minimum standards and therefore other than Country-by-Country Reporting (CbCR) it had no further BEPS obligations. The US decided not to sign the Multilateral Instrument (MLI) to implement BEPS ...


Computing Interest On Overpayments And Underpayments: How Difficult Can It Be? Very!, Mary A. Mcnulty, David H. Boucher, Joseph M. Incorvaia, Robert D. Probasco Aug 2018

Computing Interest On Overpayments And Underpayments: How Difficult Can It Be? Very!, Mary A. Mcnulty, David H. Boucher, Joseph M. Incorvaia, Robert D. Probasco

Robert Probasco

Taxpayers often assume that the difficult part of a tax dispute is resolving the tax liability and penalties, while interest computation is fairly straightforward. In the authors' experience, however, interest determinations are as subject to controversy and prone to error as tax liability determinations. The Article explores some of the areas that taxpayers should review carefully in the process of finalizing interest computations.

- Frequent Errors. The Article reviews twelve areas in which, even though the law is settled and the facts are usually clear, the Service's interest computations frequently include mistakes. Taxpayers need to be aware of these provisions ...


Does The United States Still Care About Complying With Its Wto Obligations?, Reuven S. Avi-Yonah Apr 2018

Does The United States Still Care About Complying With Its Wto Obligations?, Reuven S. Avi-Yonah

Articles

The Tax Cuts and Jobs Act of 2017 (“TCJA”) contains a provision that on its face appears to be a blatant violation of the WTO’s Subsidies and Countervailing Measures (SCM) rules. New IRC section 250 applies a reduced 13.125% tax rate to “foreign derived intangible income” (FDII), which is defined as income derived in connection with (1) property that is sold by the taxpayer to any foreign person for a foreign use or (2) services to any foreign person or with respect to foreign property. In other words, this category comprises exports for property and services, including royalties ...


Accessible Reliable Tax Advice, Emily Cauble Apr 2018

Accessible Reliable Tax Advice, Emily Cauble

University of Michigan Journal of Law Reform

Unsophisticated taxpayers who lack financial resources are disadvantaged by a shortage of adequate tax advice. The IRS does not have the resources to answer all questions asked, and the IRS’s informal advice comes with no guarantee as to its accuracy and offers the taxpayer no protection when it is mistaken. Furthermore, non-IRS sources of advice have not sufficiently filled the void left by a lack of satisfactory IRS guidance. These biases against unsophisticated taxpayers have been noted by existing literature. This Article contributes to existing literature by proposing several novel reform measures to assist unsophisticated taxpayers.

First, with respect ...


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

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 ...


Foreword – The 2017 Tax Cuts: How Polarized Politics Produced Precarious Policy, Michael J. Graetz Jan 2018

Foreword – The 2017 Tax Cuts: How Polarized Politics Produced Precarious Policy, Michael J. Graetz

Faculty Scholarship

By lowering the corporate tax rate from 35% to 21%, the 2017 tax legislation brought the U.S. statutory rate into closer alignment with the rates applicable in other Organisation for Economic Co-operation and Development (OECD) nations, thereby decreasing the incentive for businesses to locate their deductions in the United States and their income abroad. Its overhaul of the U.S. international income tax rules simultaneously reduced preexisting incentives for U.S. multinationals to reinvest their foreign earnings abroad and put a floor on the benefits of shifting profits to low-tax jurisdictions. The 2017 legislation also added an unprecedented, troublesome ...


Trump's "Big-League" Tax Reform: Assessing The Impact Of Corporate Tax Changes, Ryan J. Clements Nov 2017

Trump's "Big-League" Tax Reform: Assessing The Impact Of Corporate Tax Changes, Ryan J. Clements

Michigan Business & Entrepreneurial Law Review

This Article reviews and assesses corporate tax reforms advocated by President Donald Trump during his presidential campaign and signed into law since taking office (the Tax Cuts and Jobs Act of 2017), in light of economic theory and the Modigliani-Miller Irrelevance Theorem. The Ar-ticle argues that companies will adapt polcies in light of new taxation mea-sures, thereby impacting the effectiveness of reform. In support of this conclusion, the Article surveys two empirical studies—one in relation to the repatriation efforts of President Bush’s Homeland Investment Act and an-other in relation to unexpected changes to the taxation of Canadian income ...


The Fallacious Objections To The Tax Treatment Of Carried Interest, Douglas A. Kahn, Jeffrey H. Kahn Jun 2017

The Fallacious Objections To The Tax Treatment Of Carried Interest, Douglas A. Kahn, Jeffrey H. Kahn

Articles

“The tax treatment of carried interest has become a notorious bete noire for many politicians and some academicians and practitioners. Both 2016 presidential candidates denounced the current tax treatment and vowed to change it. President Obama described the current treatment as a "tax loophole" which should be closed. Others have also characterized the current tax treatment as an abusive loophole.' It is the thesis of this article that those criticisms are unfounded. To the contrary, the current tax treatment accords with sound tax policy and is proper and appropriate. Given the broad approval that attended the attacks on carried interest ...


Problems With Destination-Based Corporate Taxes And The Ryan Blueprint, Reuven S. Avi-Yonah, Kimberly Clausing Apr 2017

Problems With Destination-Based Corporate Taxes And The Ryan Blueprint, Reuven S. Avi-Yonah, Kimberly Clausing

Articles

With the election of Donald Trump and the Republican Party’s domination of Congress, House Speaker Paul Ryan’s blueprint for fundamental tax reform requires more careful analysis. The Ryan blueprint combines reduced individual rates with a destination-based cash flow type business tax applicable to all businesses. The destination-based business tax at the center of the blueprint has several major problems: It is incompatible with our WTO obligations, it is incompatible with our tax treaties, and it will not eliminate the problems of income shifting and inversions it is designed to address. In addition, these proposals generate vexing technical problems ...


Tax Cannibalization And Fiscal Federalism In The United States, David Gamage, Darien Shanske Feb 2017

Tax Cannibalization And Fiscal Federalism In The United States, David Gamage, Darien Shanske

Northwestern University Law Review

We began this project pondering a riddle. Most state governments have adopted what we—and many others—view as clearly suboptimal tax policies, especially in regard to the taxation of corporate income and capital gains. Yet, with the notable exception of those who oppose progressivity and the taxation of capital, state-level tax policymakers have had remarkably little appetite for reform. This Article provides one major explanation for this riddle by identifying and demonstrating a phenomenon that we label as “tax cannibalization.” We argue that flawed state-level tax policies derive in part from perverse incentives inadvertently created by the federal government.


Tax Treatment Of A Marijuana Business, Douglas A. Kahn, Howard Bromberg Jan 2017

Tax Treatment Of A Marijuana Business, Douglas A. Kahn, Howard Bromberg

Articles

Currently, twenty-eight states and the District of Columbia allow the use of marijuana for medical purposes and permit the conduct of a business marketing of marijuana for that purpose. Eight of those states and the District of Columbia permit the recreational use of marijuana. There is reason to believe that more states will decriminalize the marketing of marijuana. However, marijuana is listed in Schedule 1 of the federal Controlled Substances Act of 1970 (CSA) which makes it illegal under federal law to manufacture or distribute marijuana even when it is legal to do so under local state law. In a ...


The Mapmaker’S Dilemma In Evaluating High-End Inequality, Daniel Shaviro Nov 2016

The Mapmaker’S Dilemma In Evaluating High-End Inequality, Daniel Shaviro

University of Miami Law Review

The last thirty years have witnessed rising income and wealth concentration among the top 0.1% of the population, leading to intense political debate regarding how, if at all, policymakers should respond. Often, this debate emphasizes the tools of public economics, and in particular optimal income taxation. However, while these tools can help us in evaluating the issues raised by high-end inequality, their extreme reductionism—which, in other settings, often offers significant analytic payoffs—here proves to have serious drawbacks. This Article addresses what we do and don’t learn from the optimal income tax literature regarding high-end inequality, and ...


Provisions Denying A Deduction For Illegal Expenses And Expenses Of An Illegal Business Should Be Repealed, Douglas A. Kahn, Howard Bromberg Jan 2016

Provisions Denying A Deduction For Illegal Expenses And Expenses Of An Illegal Business Should Be Repealed, Douglas A. Kahn, Howard Bromberg

Articles

Currently, the tax law denies a deduction for business expenses that violate a federal or state law (but only if the state law is generally enforced). In addition, losses, including business losses, cannot be deducted if they arise out of an illegal activity. For example, medical expenses are denied a deduction if they are illegal. Kickbacks, bribes, and rebates given in connection with the Medicaid or Medicare program are nondeductible. Any expenses, legal or not, incurred in connection with the conduct of a business of selling a controlled substance that is prohibited by federal law (or by the law of ...


Federal Income Tax Developments: 1984, Merlin G. Briner, Richard J. Kovach, James W. Childs Jul 2015

Federal Income Tax Developments: 1984, Merlin G. Briner, Richard J. Kovach, James W. Childs

Akron Law Review

FEDERAL INCOME TAX DEVELOPMENTS: 1984 is the twelfth in a series of articles published at The University of Akron School of Law. In keeping with the established format, the scope of this survey is limited to selected substantive developments in the field of income taxation.


Reviving Fiscal Citizenship, Ajay K. Mehrotra Apr 2015

Reviving Fiscal Citizenship, Ajay K. Mehrotra

Michigan Law Review

April 15 is a day that most Americans dread. That date is, of course, when federal and nearly all state-level individual income tax returns are due. Agonizing over the filing of income tax returns has long been a perennial part of modern American legal culture. Since the mid-1940s, when the United States first adopted a return-based mass income tax, the vast majority of Americans have been legally required to file an annual Form 1040. Over the years, taxpayers have been complaining about, procrastinating over, and generally loathing the filing of their annual tax returns. Indeed, in recent times, April 15 ...


Allocative Fairness And The Income Tax, Joseph Dodge Feb 2015

Allocative Fairness And The Income Tax, Joseph Dodge

Joseph M Dodge

Abstract for: Allocative Fairness and the Income Tax

This article seeks to provide a normative justification for the “allocative tax fairness” principle of “objective ability to pay.” First off is a brief overview of norm categories as they relate to taxation. Here, the category of internal-to-tax fairness (“allocative fairness”), referring to how the tax burden should be apportioned among the population, is identified as being distinct from a conception of a good or just society (social equity). Allocative tax fairness is often referred to as “horizontal equity.” Unfortunately, that notion is purely formal, and the remainder of the article develops ...


The Case For Taxing (All Of) Labor Income, Consumption, Capital Income, And Wealth, David Gamage Jan 2015

The Case For Taxing (All Of) Labor Income, Consumption, Capital Income, And Wealth, David Gamage

Articles by Maurer Faculty

Perhaps the most fundamental questions in tax legal scholarship concern debates about what should be the ideal tax base or tax bases. In particular, scholars have vigorously disagreed about (1) whether the United States should follow other developed countries in supplementing its income tax with a value-added consumption tax, and (2) whether governments should seek to tax capital income and wealth or should instead seek to redesign or replace income taxes with progressive consumption taxes.

The prior economics-oriented theoretical literature on these questions has largely focused on analyzing labor supply and savings behaviors. Yet the existing empirical literature does not ...


Controversies In Tax Law: A Matter Of Perspective (Introduction), Anthony C. Infanti Jan 2015

Controversies In Tax Law: A Matter Of Perspective (Introduction), Anthony C. Infanti

Book Chapters

This volume presents a new approach to today’s tax controversies, reflecting that debates about taxation often turn on the differing worldviews of the debate participants. For instance, a central tension in the academic tax literature — which is filtering into everyday discussions of tax law — exists between “mainstream” and “critical” tax theorists. This tension results from a clash of perspectives: Is taxation primarily a matter of social science or social justice? Should tax policy debates be grounded in economics or in critical race, feminist, queer, and other outsider perspectives?

To capture and interrogate what often seems like a chasm between ...


Who Invented The Single Tax Principle?: An Essay On The History Of Us Treaty Policy, Reuven S. Avi-Yonah Jan 2015

Who Invented The Single Tax Principle?: An Essay On The History Of Us Treaty Policy, Reuven S. Avi-Yonah

Articles

In 1997, I wrote an article on the international tax challenges posed by the then-nascent electronic commerce, in which I suggested that the international tax regime is based on two principles: the benefits principle and the single tax principle. The benefits principle states that active (business) income should be taxed primarily by the country of source, and passive (investment) income should be taxed primarily by the country of residence. This is the famous compromise reached by the four economists at the foundation of the regime in 1923 and is not particularly controversial. It is embodied in every one of the ...


Cancellation Of Debt And Related Transactions, Douglas A. Kahn, Jeffrey H. Kahn Jan 2015

Cancellation Of Debt And Related Transactions, Douglas A. Kahn, Jeffrey H. Kahn

Articles

If a taxpayer borrows money, the borrowed funds are not included in the taxpayer's gross income. That treatment is proper even though the taxpayer has increased his assets by the amount he borrowed because he also has created a corresponding liability to pay back the loan. The taxpayer's net: wealth has not increased. 'The more difficult and interesting questions arise when the taxpayer fails to repay the loan. At first blush, it would appear that upon cancellation of a loan, the taxpayer should have income for the amount that was cancelled. However, the current tax treatment is not ...


Tax Debt Help – Settlement & Negotiation, Lissa Coffey Nov 2014

Tax Debt Help – Settlement & Negotiation, Lissa Coffey

LissaCoffey

Get helpful tips, advice and help with debt or any kind of irs help on setting up payment plans, requesting affordable installment agreements, reducing your tax debts through an Offer in Compromise, or discharging your tax debts through bankruptcy. Tags: GET-OUT-OF-IRS-TAX-DEBT, irs tax help, tax relief help, IRS-PAYMENT-PLAN, irs debt, irs help, help with debt, help with tax debt


The Intersection Of Tax And Bankruptcy: The Mccoy Rule, John Ferguson Sep 2014

The Intersection Of Tax And Bankruptcy: The Mccoy Rule, John Ferguson

John Ferguson

No abstract provided.


Formulary Appointment In The U.S. International Income Tax System: Putting Lipstick On A Pig?, J. Clifton Fleming Jr., Robert J. Peroni, Stephen E. Shay Sep 2014

Formulary Appointment In The U.S. International Income Tax System: Putting Lipstick On A Pig?, J. Clifton Fleming Jr., Robert J. Peroni, Stephen E. Shay

Michigan Journal of International Law

An affiliated corporate group consists of two or more corporations linked by sufficient stock ownership to cause them to function as an economic unit instead of as independent economic actors. Thus, an affiliated corporate group engaged in international business is often referred to as a multinational enterprise (MNE), a term that we will use throughout this Article. When corporate members of an MNE engage in transactions among themselves, the prices they employ (transfer prices) will significantly affect the amount of overall MNE income that is allocated to each member and, hence, to the tax bases of the various countries in ...


Who's Afraid Of Redistribution? An Analysis Of The Earned Income Tax Credit, Jennifer Bird-Pollan Jul 2014

Who's Afraid Of Redistribution? An Analysis Of The Earned Income Tax Credit, Jennifer Bird-Pollan

Jennifer Bird-Pollan

In the 2008 Presidential campaign, the American public was reminded time and again of the differences in the economic policies of the nominees: John McCain would cut taxes, and Barack Obama would raise them, although only on those earning over $250,000. In the final days of the campaign, the McCain camp accused Obama of proposing “redistribution,” and the Obama camp quickly denied that description. So why do presidential candidates run so quickly from the r-word? McCain’s senior policy advisor equated redistribution with socialism, but redistribution, in the form of the federal income tax system, is a central tenet ...


Moving Beyond Marriage: A Proposed Unit Of Presumed Economic Interdependence For Joint Filing Purposes In Bankruptcy And In Tax, Heather V. Graham Jul 2014

Moving Beyond Marriage: A Proposed Unit Of Presumed Economic Interdependence For Joint Filing Purposes In Bankruptcy And In Tax, Heather V. Graham

Pace Law Review

In order to promote both equality and efficiency, this Comment proposes that individuals should have the opportunity to file jointly for tax and bankruptcy purposes when they have a relationship predicated upon economic interdependence, as opposed to basing the opportunity to file jointly upon marital status. Part I of this Comment will briefly discuss the history of marriage in the United States. In particular, Part I will discuss the role that the government has had in promoting and regulating marriage and how the treatment of married persons operates to the exclusion of the unmarried. Parts II and III of this ...