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The 1969 Tax Reform Act And Charities: Fifty Years Later, Philip Hackney Jan 2020

The 1969 Tax Reform Act And Charities: Fifty Years Later, Philip Hackney

Articles

Fifty years ago, Congress enacted the Tax Reform Act of 1969 to regulate charitable activity of the rich. Congress constricted the influence of the wealthy on private foundations and hindered the abuse of dollars put into charitable solution through income tax rules. Concerned that the likes of the Mellons, the Rockefellers, and the Fords were putting substantial wealth into foundations for huge tax breaks while continuing to control those funds for their own private ends, Congress revamped the tax rules to force charitable foundations created and controlled by the wealthy to pay out charitable dollars annually and avoid self-dealing. Today ...


A Critical Research Agenda For Wills, Trusts And Estates, Bridget J. Crawford, Anthony C. Infanti Jan 2014

A Critical Research Agenda For Wills, Trusts And Estates, Bridget J. Crawford, Anthony C. Infanti

Articles

The law of wills, trusts, and estates could benefit from consideration of its development and impact on people of color; women of all colors; lesbian, gay, bisexual, and transgendered individuals; low-income and poor individuals; the disabled; and nontraditional families. One can measure the law’s commitment to justice and equality by understanding the impact on these historically disempowered groups of the laws of intestacy, spousal rights, child protection, will formalities, will contests, and will construction; the creation, operation and construction of trusts; fiduciary administration; creditors’ rights; asset protection; nonprobate transfers; planning for incapacity and death; and wealth transfer taxation. This ...


Income And Substitution Effects Of Estate Taxation, James R. Hines Jr. Jan 2013

Income And Substitution Effects Of Estate Taxation, James R. Hines Jr.

Articles

This paper evaluates the effect of estate taxes on labor supply. The analysis decomposes the effect of estate taxation into the substitution effect of relative price changes and the two income effects for which the estate tax is responsible. These two income effects arise from tax burdens on those who leave estates plus tax burdens on those who receive them. Despite the double income burden of the estate tax, existing empirical evidence suggests that the net effect of estate taxation on aggregate labor supply is uncertain.


The Taxation Of A Gift Or Inheritance From An Employer., Douglas A. Kahn Jan 2011

The Taxation Of A Gift Or Inheritance From An Employer., Douglas A. Kahn

Articles

The focus of this article is to examine the following questions: 1. whether, despite its unrestricted language, section 102(c) does not apply to some gratuitous transfers to an employee; 2. if so, what are the exceptions to section 102(c); and 3. when section 102(c) does not apply to a transfer, whether it will be excluded from income. Part II of this article examines the conditions under which a gratuitous transfer to an employee will be excluded from income under the Duberstein standard and under the normal tax treatment of testamentary transfers -- in other words, how the section ...


Us Perpetual Trusts, Lawrence W. Waggoner Jan 2011

Us Perpetual Trusts, Lawrence W. Waggoner

Articles

In 2009, the UK reconfirmed tis long-standing public policy against perpetual trusts. America has been moving in the opposite direction. Recent years have seen a movement in the states to pass legislation allowing settlors to create family trusts that can last forever or for several centuries. Sadly, and embarrassingly, the American perpetual-trust movement has not been based on the merits of removing the traditional curb on excessive dead-hand control. The policy issues associated with allowing perpetual trusts have not been seriously discussed in the state legislatures. The driving force has been interstate competition for trust business.


It Is Logic Rather Than Whom You Trust: A Rejoinder To Prof. Cohen, Douglas A. Kahn Jan 2010

It Is Logic Rather Than Whom You Trust: A Rejoinder To Prof. Cohen, Douglas A. Kahn

Articles

This article is the continuation of an exchange that has taken place between Prof. Stephen B. Cohen and me concerning the validity of criticisms leveled by Chief Justice John Roberts on an opinion by then-Judge Sonia Sotomayor writing for the Second Circuit in the case of William L. Rudkin Testamentary Trust v. Commissioner. While affirming the Second Circuit’s decision, Chief Justice Roberts, writing for a unanimous Supreme Court, criticized and rejected Justice Sotomayor’s construction of the relevant statutory provision. In an article in the August 3, 2009, issue of Tax Notes, Cohen defended Justice Sotomayor’s construction of ...


Message To Congress: Halt The Tax Exemption For Perpetual Trusts, Lawrence W. Waggoner Jan 2010

Message To Congress: Halt The Tax Exemption For Perpetual Trusts, Lawrence W. Waggoner

Articles

The federal estate tax is in abeyance this year. The popular press has picked up on the possibility that the estates of billionaires such as the late George Steinbrenner, who owned the New York Yankees, will escape the tax. The House Ways and Means Committee, chaired by Representative Sander Levin of Michigan, and the Senate Finance Committee, chaired by Senator Max Baucus of Montana, are now considering two questions: what the maximum rate and exemption will be when the estate tax returns and whether the tax will be reinstated for this year. Lurking behind the headlines but equally important is ...


How Important Are Perpetual Tax Savings?, James R. Hines Jr. Jan 2010

How Important Are Perpetual Tax Savings?, James R. Hines Jr.

Articles

State and local expenditure and tax revenue respond less to the business cycle than do federal spending and revenue, thereby reducing the countercyclicality of total government expenditure and revenue. This paper considers forces responsible for the cyclical pattern of state expenditure and revenue. Annual fluctuations in state personal income are associated with small changes in state spending and significant changes in tax receipts; receipt of federal grants is associated with greater state spending. Tax collections, and to a lesser degree expenditure, of larger states are more closely associated with annual income fluctuations than are the tax collections and expenditure of ...


Taxing Inheritances, Taxing Estates, James R. Hines Jr. Jan 2010

Taxing Inheritances, Taxing Estates, James R. Hines Jr.

Articles

This Article considers two aspects of converting the U.S. transfer tax system to one in which burdens are imposed on the basis of receipt rather than gift. The first aspect is the economic impact of distinguishing transfer tax liabilities by numbers of children in a family in addition to the total amount of transferred wealth. The second aspect is the nature of the event that triggers tax liability. Taxing on the basis of receipt raises complicated issues about generation-skipping transfers, transfers to trusts, and transfers that involve foreign as well as domestic parties, all of which are potentially influenced ...


Rudkin Testamentary Trust -- A Response To Prof. Cohen, Douglas A. Kahn Sep 2009

Rudkin Testamentary Trust -- A Response To Prof. Cohen, Douglas A. Kahn

Articles

In the August 3 issue of Tax Notes, Prof. Stephen Cohen wrote an article about Justice Sonia Sotomayor’s opinions in three tax cases. Of those three cases, only the opinion she wrote in William L. Rudkin Testamentary Trust v. Commissioner, 467 F.3d 149 (2d Cir. 2006), Doc 2006- 21522, 2006 TNT 203-4, is worthy of comment. Although the Second Circuit’s decision in that case was affirmed by the Supreme Court under the name Knight v. Commissioner, the construction of the critical statutory language that Justice Sotomayor adopted was rejected and criticized by Chief Justice Roberts, writing for ...


Condemnation Without Justification, Douglas A. Kahn Jan 2008

Condemnation Without Justification, Douglas A. Kahn

Articles

On August 6-8, 2007, Prof. Neil Buchanan posted in Michael Dorf’s blog (http://michaeldorf.org/; for the blog entry regarding the death tax, see http:// michaeldorf.org/2007/08/dishonest-tax-rhetoric-part-3- of-3.html) a three-part series on what he deemed to be examples of political use of terminology to describe tax issues in a manner that is likely to mislead the public. Prof. Buchanan described this practice as ‘‘dishonest tax rhetoric.’’ He awarded first, second, and third prizes for the most egregious examples of dishonest rhetoric. I, however, found no objection to the usages he considered to be the two ...


Colorado Revisits The Rule Against Perpetuities, Wayne M. Gazur Jan 2006

Colorado Revisits The Rule Against Perpetuities, Wayne M. Gazur

Articles

The 2006 Colorado General Assembly passed legislation adopting a 1000-year limitation applicable to interests in trust, practically eliminating the Rule Against Perpetuities ("RAP"). This article discusses the legislation's impact on the RAP in trust and non-trust situations.


Abandoning Principles: Qualified Tuition Programs And Wealth Transfer Taxation Doctrine, Wayne M. Gazur Jan 2004

Abandoning Principles: Qualified Tuition Programs And Wealth Transfer Taxation Doctrine, Wayne M. Gazur

Articles

In 1996 Congress gave its imprimatur to a modest qualified tuition program provision. Over the course of the next five years the provision was expanded, providing additional wealth transfer taxation and income taxation benefits. This essay proposes that unless limited, such benefits are inconsistent with established taxation principles and also have the potential to undermine the integrity of the wealth transfer tax structure and the progressive nature of the income tax.


The 2003 Revised Uniform Estate Tax Apportionment Act, Douglas A. Kahn Jan 2004

The 2003 Revised Uniform Estate Tax Apportionment Act, Douglas A. Kahn

Articles

Editors' Synopsis: This Article describes the significant sections of the 2003 Uniform Estate Tax Apportionment Act (the "2003 Uniform Act'). The Article explains the purpose and operation of the 2003 Uniform Act's various sections and notes some of the differences between the 2003 Uniform Act and its prior version.


Gifts, Gafts And Gefts: The Income Tax Definition And Treatment Of Private And Charitable 'Gifts' And A Principled Policy Justification For The Exclusion Of Gifts From Income, Douglas A. Kahn, Jeffrey H. Kahn Jan 2003

Gifts, Gafts And Gefts: The Income Tax Definition And Treatment Of Private And Charitable 'Gifts' And A Principled Policy Justification For The Exclusion Of Gifts From Income, Douglas A. Kahn, Jeffrey H. Kahn

Articles

Gifts have been given special treatment by the income tax laws since the first post-16th Amendment tax statute was adopted in 1913. The determination of how the income tax law should treat gifts raises a number of issues. For example: should gifts be given special treatment? If so, what should qualify as a gift? Should gifts to a private party be taxable to the donee? Should gifts to a private party be deductible by the donor? Should the donee's basis in a gift of property be determined by reference to the basis that the donor had, and should any ...


The Rise Of The Perpetual Trust, Jesse Dukeminier, James E. Krier Jan 2003

The Rise Of The Perpetual Trust, Jesse Dukeminier, James E. Krier

Articles

For more than two centuries, the Rule against Perpetuities has served as the chief means of limiting a transferor's power to tie up property by way of successive contingent interests. But recently, at least seventeen jurisdictions in the United States have enacted statutes abolishing the Rule in the case of perpetual (or near-perpetual) trusts. The prime mover behind this important development has been the federal Generation-Skipping Transfer Tax. This Article traces the gradual decline of the common law Rule against Perpetuities, considers the dynamics behind the recent wave of state legislation, examines the problems that might result from the ...


Muddling Along With The Federal Wealth Transfer Tax: A Survey Of Practitioners And Law School Professors, Wayne M. Gazur Jan 1999

Muddling Along With The Federal Wealth Transfer Tax: A Survey Of Practitioners And Law School Professors, Wayne M. Gazur

Articles

Recent efforts to repeal the wealth transfer tax system have prompted enormous discussion. In this Article, the author presents the results of his survey of members of the American Bar Association Real Property, Probate and Law Section about this issue and other reforms which have been enacted or suggested.


Tax Consequences Of Assigning Life Insurance - Time For Another Look, Douglas A. Kahn, Lawrence W. Waggoner Jan 1999

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.


Do They Practice What We Teach?: A Survey Of Practitioners And Estate Planning Professors, Wayne M. Gazur Jan 1999

Do They Practice What We Teach?: A Survey Of Practitioners And Estate Planning Professors, Wayne M. Gazur

Articles

This article presents the results of a 1998 mail survey sent to members of the American Bar Association Real Property, Probate & Trust Law Section and to law professors teaching estate planning. The principal goal of the survey was to compare the opinions of practitioners and law professors concerning the importance of 31 estate planning issues and techniques. The survey also included an open-ended solicitation of issues deemed significant by the participant.

The survey found consistency between practitioner and professor responses with respect to techniques such as Crummey planning. Legal education appears to be effective in dealing with core principles. More ...


What's In A Name: An Argument For A Small Business Limited Liability Entity Statute (With Three Subsets Of Default Rules), Dale A. Oesterle, Wayne M. Gazur Jan 1997

What's In A Name: An Argument For A Small Business Limited Liability Entity Statute (With Three Subsets Of Default Rules), Dale A. Oesterle, Wayne M. Gazur

Articles

The recent proliferation of small business entity forms is primarily a result of their tax characterization. With the recent adoption of the IRS "check-the-box" regulations and, as a consequence, the elimination of traditional tax distinctions, many of these forms have lost their appeal. This article proposes starting over with one form, the "limited liability entity." Part I discusses the history of small business forms. Part II analyzes the current forms in light of the recent check-the- box legislation. Part III discusses the necessity of and rationale behind a unified entity statute. Finally, Part IV outlines a unified limited liability entity ...


Congressional Diversions: Legislative Responses To The Estate Valuation Freeze, Wayne M. Gazur Jan 1989

Congressional Diversions: Legislative Responses To The Estate Valuation Freeze, Wayne M. Gazur

Articles

No abstract provided.


The Funding Of Children's Educational Costs, Douglas A. Kahn Jan 1985

The Funding Of Children's Educational Costs, Douglas A. Kahn

Articles

A plan for reduction of educational costs should take federal transfer taxes into account. The method chosen for reducing income tax liability usually will involve making gifts. To the extent that it is convenient to do so, the transfer tax consequences of making such gifts should be minimized. This article will examine the estate and gift tax consequences of the income tax reduction arrangements described herein and will consider means of structuring the transactions so as to minimize those consequences.


Introduction, Douglas A. Kahn Jan 1982

Introduction, Douglas A. Kahn

Articles

While the estate and gift tax area has by no means been ignored in the legal literature, it has not been one of the more popular subjects. For that reason, a symposium on transfer taxation would be welcome at any time, but this is an especially propitious moment for one to appear.


Closely Held Stocks—Deferral And Financing Of Estate Tax Costs Through Sections 303 And 6166, Douglas A. Kahn Jan 1982

Closely Held Stocks—Deferral And Financing Of Estate Tax Costs Through Sections 303 And 6166, Douglas A. Kahn

Articles

The enactment of the Economic Recovery Tax Act of 1981 (hereinafter referred to as "the 1981 Act") will reduce both the impact of federal wealth transfer taxes and the number of persons still subject to them. Nevertheless, even after the 1981 Act takes full effect, a category of persons remains for whom wealth transfer taxes will constitute a meaningful burden and whose estates face a liquidity problem in satisfying the estate tax liability. The focus of this article is on two statutory techniques: redemptions of stock pursuant to section 3031 and deferral of estate tax payments under section 6166.2 ...


The Estate Tax Marital Deduction, Harold Dubroff, Douglas A. Kahn Jan 1980

The Estate Tax Marital Deduction, Harold Dubroff, Douglas A. Kahn

Articles

The estate tax marital deduction, section 2056 of the Internal Revenue Code, was enacted in 1948, along with the split-income provisions of the income tax law and the marital deduction and split-gift provisions of the gift tax law. The purpose was to give married residents of common law states approximately the same federal tax advantages that were available to married residents of community property states. Ordinarily, upon the death of a married resident of a community property state, only one-half of the community property is taxed in the decedent's estate. Section 2056 achieves approximately the same result for married ...


Federal Taxation Of The Assignment Of Life Insurance, Douglas A. Kahn, Lawrence W. Waggoner Jan 1977

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 ...


Transactions Subject To Gift Tax, Douglas A. Kahn, Earl M. Colson Jan 1975

Transactions Subject To Gift Tax, Douglas A. Kahn, Earl M. Colson

Articles

The gift tax is imposed on the "transfer of property by gift." The term gift is not expressly defined either in the Code or in the Treasury Regulations. However, section 2512(b), dealing with the valuation of gifts, states that "where property is transferred for less than an adequate and full consideration in money or money's worth," the difference between the value of the property transferred and the consideration received constitutes a gift. Thus, for gift tax purposes, the determination of whether a gift was made does not turn so much on the intent of the transferor as it ...


A Guide To The Estate And Gift Tax Amendments Of 1970, Douglas A. Kahn Jan 1971

A Guide To The Estate And Gift Tax Amendments Of 1970, Douglas A. Kahn

Articles

The Excise, Estate, and Gift Tax Adjustment Act of 1970 [Pub. L. No. 91-614 (Dec. 31, 1970) made a number of amendments to the federal estate and gift tax laws. The estate tax laws were amended to shorten the period of time for filing estate tax returns and for the alternate valuation date and for several related items. In addition, for income tax purposes, the holding period of property that was included in a decedent's gross estate and that was acquired from the decedent was altered; and fiduciaries were granted additional means of obtaining a discharge of their personal ...


Transactions Subject To The Federal Gift Tax, Douglas A. Kahn Jan 1970

Transactions Subject To The Federal Gift Tax, Douglas A. Kahn

Articles

The federal gift tax was first enacted in 1924, approximately eight years after the adoption of the estate tax. As originally enacted, the tax was largely ineffective because it was computed on an annual basis without regard to gifts made in prior years.


Mandatory Buy-Out Agreements For Stock Of Closely Held Corporations, Douglas A. Kahn Nov 1969

Mandatory Buy-Out Agreements For Stock Of Closely Held Corporations, Douglas A. Kahn

Articles

A buy-out of a shareholder's stock is a sale of his stock holdings in a specific corporation pursuatnt to a pre-existing contract. In recent years such arrangements have, deservedly, become an increasingly popular planning device for shareholders in closely held corporations; they make it possible to limit the class of potential shareholders, provide liquidity for the estate of a deceased shareholder, and establish a value for stock which has no active market. There are two popular categories of buy-out plans. If the prospective purchaser of a decedent's shares is the corporation that issued them, the plan is called ...