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Random Thoughts On Applying Judicial Doctrines To Interpret The Internal Revenue Code, Martin J. Mcmahon Jr.

Martin J. McMahon

From the symposium "Business Purpose, Economic Substance, and Corporate Tax Shelters" .

Risk, Return, And Objective Economic Substance, Charlene Luke

Charlene Luke

The economic substance doctrine is a judicial method used to assess transactions suspected of being nothing more than elaborate (and illicit) tax avoidance. Courts vary in their formulation of the doctrine. Generally, the test consists of (1) a subjective inquiry into the taxpayer's motivations for entering the suspect transaction and (2) an objective inquiry into whether the transaction accomplished anything beyond tax effects. Both inquiries frequently revolve around the profit potential of the suspect transaction. In making an objective inquiry into profit, courts focus on the profit potential exclusive of taxes - the pre-tax landscape. This Article suggests that although …

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Effects Of Strategic Tax Behaviors On Corporate Governance, Nicola Sartori

Nicola Sartori

This paper addresses agency tensions and conflicts that may emerge between managers (agents) and shareholders (principals) as a result of aggressive tax planning strategies adopted by publicly held corporations. The interactions between corporate governance and taxation are bilateral and biunique: in fact, on one side, the manner in which corporate governance rules are structured affects the way a corporation fulfills its tax obligations; on the other side, the way tax designs (from the government perspective) and related tax strategies (from the corporation perspective) are planned influences corporate governance dynamics. This article investigates such bilateral relationship limiting the analysis to the …