Law Commons^™

Why Tax Wealth Transfers?: A Philosophical Analysis, Jennifer Bird-Pollan

Law Faculty Scholarly Articles

The one-hundredth anniversary of the estate tax provides an ideal moment to reflect on the role of wealth transfer taxation in the larger scheme of the U.S. tax system. Wealth and income inequality are at historically high levels, and the responses to these issues are often reduced to a simplistic political dichotomy of “right” versus “left.” The multitude of views of the American people cannot be reduced to such simple generalities without losing important nuances. This Article identifies three general categories of political philosophical viewpoints that are commonly endorsed by both politicians and everyday Americans, and then examines the current …

The Pay Or Play Penalty Under The Affordable Care Act: Emerging Issues, Kathryn L. Moore

Law Faculty Scholarly Articles

The Affordable Care Act does not require that employers provide employees with health care coverage. It does, however, impose an excise tax on large employers that fail to offer their employees affordable employer-sponsored health care coverage. The excise tax, commonly referred to as a “pay-or-play penalty,” was scheduled to go into effect beginning in 2014. The United States Treasury Department (“Treasury”), however, has delayed enforcement of the penalty until 2015 for employers with 100 or more full-time employees, and until 2016 for employers with 50 to 99 employees.

Implementation of the pay-or-play penalty has given rise to a host of …

Death, Taxes, And Property (Rights): Nozick, Libertarianism, And The Estate Tax, Jennifer Bird-Pollan

Law Faculty Scholarly Articles

The primary purpose of this Article is to dispute the moral claims to post-death property rights made by libertarians when they argue against the estate tax. As I will show later in this Article, my argument does not necessarily entail enacting an estate tax, nor does it require a particular level of tax. I am merely trying to demonstrate that those who argue that the estate tax is an immoral violation of the private property rights of the deceased are mistaken. This is not to say that the estate of the deceased should necessarily pass to the government. It is …

The Unjustified Subsidy: Sovereign Wealth Funds And The Foreign Sovereign Tax Exemption, Jennifer Bird-Pollan

Law Faculty Scholarly Articles

The taxation of Sovereign Wealth Funds in the United States is outmoded and due for reconsideration. Offering a tax exemption to the billion dollar investment funds owned by foreign governments is both unfair and ineffective. Founded in the principles of sovereign immunity, the foreign sovereign tax exemption, codified in I.R.C. § 892, fails to satisfy the Congressional goals that motivated its creation. This Article explains the current taxation of foreign sovereigns and, by extension, Sovereign Wealth Funds. It then illustrates that the current exemption is simultaneously too broad, providing a tax exemption for activities that are clearly nongovernmental activities, and …

The Commerciality Doctrine As Applied To The Charitable Tax Exemption For Homes For The Aged: State And Local Tax Perspectives, David A. Brennen

Law Faculty Scholarly Articles

This essay examines the question of how state and local government officials should consider federal tax law principles, like the commerciality doctrine, when they challenge state and local property tax exemptions that rely, at least in part, on tax-exempt charitable status for federal income tax purposes. In particular, this essay uses the example of continuing care retirement communities to consider tax-exempt law’s commerciality doctrine in an attempt to discern distinctions between “homes for the aged” that are “charitable,” and thus entitled to exemption, and those that are too commercial, and thus not entitled to exemption. In fact, one might say …

A Diversity Theory Of Charitable Tax Exemption—Beyond Efficiency, Through Critical Race Theory, Toward Diversity, David A. Brennen

Law Faculty Scholarly Articles

What is the normative rationale for the federal income tax exemption for nonprofit charitable corporations? Even though the exemption dates back to 1894, Congress has failed to fully rationalize it. Though scholars and courts have attempted over the years to come up with a coherent rationale for the charitable tax exemption, their attempts are focused almost exclusively on economic efficiency. Thus, the charitable tax exemption is typically framed by noted tax scholars like Boris Bittker, Henry Hansmann, and others as an economically efficient means of providing certain goods and services to the public. Rationalizing the charitable tax exemption in economic …

2002 Eleventh Circuit Survey: Federal Taxation, David A. Brennen

Law Faculty Scholarly Articles

During 2002 federal courts in the United States decided nineteen cases that directly impact federal tax law in the Eleventh Circuit. These cases involve a variety of tax law matters including Federal Insurance Contributions Act ("FICA") payroll tax, estate and gift tax, IRS authority to levy and assess tax, and discharges in bankruptcy. Other tax-related matters addressed by courts in 2002 that impact tax law in the Eleventh Circuit include inventory recapture in an S-corporation conversion, attorney fees for the prevailing party in a tax dispute, and injunctions against tax preparers. By far the most important tax case decided in …

Race Conscious Affirmative Action By Tax Exempt 501(C)(3) Corporations After Grutter And Gratz, David A. Brennen

Law Faculty Scholarly Articles

The Equal Protection Clause of the Fourteenth Amendment generally acts as a legal limit on the permissible bounds of government action. Accordingly, public universities and other government entities are constitutionally prohibited from engaging in acts that violate equal protection of the laws. The Supreme Court recently reinforced this point when it ruled, in two related cases, that public universities may consider the race of applicants when making admissions decisions, so long as an applicant's race does not amount to a deciding factor when granting admission. By its very terms, the constitutional limitation imposed by the Equal Protection Clause only directly …

Charities And The Constitution: Evaluating The Role Of Constitutional Principles In Determining The Scope Of Tax Law's Public Policy Limitation For Charities, David A. Brennen

Law Faculty Scholarly Articles

This Article expands the discussion of whether tax-exempt charities, for constitutional law purposes, should be treated as government actors, as private actors or as something in between. While government actors are subject to constitutional law restrictions concerning discrimination and free speech, private non-government actors are not generally subject to these same restrictions. Although tax-exempt charities are often thought of as sovereigns and, thus, government-like, the fact remains that charities are private entities created to serve public purposes. As private entities, charities - like all other private entities - are not necessarily bound by constitutional law principles. Still, the many “public” …

Tax Expenditures, Social Justice And Civil Rights: Expanding The Scope Of Civil Rights Laws To Apply To Tax-Exempt Charities, David A. Brennen

Law Faculty Scholarly Articles

In recent years, courts have decided a number of cases in which private organizations discriminated against people based solely on their race, gender, sexual orientation, or other immutable traits. For example, in 2000, the Boy Scouts of America revoked a New Jersey man's membership in the Boy Scouts because he was gay. New Jersey's supreme court held that the Boy Scouts' action violated New Jersey's anti-discrimination law. Notwithstanding the state court's holding, the United States Supreme Court concluded that the First Amendment prevented any court from forcing the Boy Scouts to keep a gay man as a member of its …

The Power Of The Treasury: Racial Discrimination, Public Policy, And "Charity" In Contemporary Society, David A. Brennen

Law Faculty Scholarly Articles

The Treasury Department is empowered to enforce “established public policy” with respect to tax-exempt charities. Under this public policy power, the Treasury has revoked the tax-exempt charitable status of organizations that discriminated against blacks, organizations whose members engaged in civil disobedience against war, and organizations involved in illegal activity. The Treasury interprets its public policy power as applying to any activity that violates clear public policy. Thus, presumably, the Treasury could use this power to deny tax-exempt charitable status to an organization that engages in conduct that violates assisted suicide laws, anti-abortion laws, or other sufficiently “established” public policies.

The …

Treasury Regulations And Judicial Deference In The Post-Chevron Era, David A. Brennen

Law Faculty Scholarly Articles

Analysis of several post-Chevron cases indicates that every major Supreme Court case since 1984 involving the validity of a Treasury regulation is consistent with Chevron. Indeed, since 1984 every challenged Treasury regulation interpreting a statute in which Congress failed to address a specific tax issue has been upheld by the Court. In fact, no Supreme Court case since 1984 could be discovered in which the Court invalidated a Treasury regulation on the grounds that it was an unreasonable interpretation of a statute. Several post-Chevron Supreme

Court decisions, however, rejected the Treasury's application of a tax regulation to …

State And Local Taxation: When Will Congress Intervene?, Kathryn L. Moore

Law Faculty Scholarly Articles

This article examines congressional activity in the state and local tax area to determine when, if ever, Congress will enact legislation mandating uniformity in state and local taxation. The article begins by briefly describing our current system of state and local taxation and explaining why we need more uniformity therein.

The article then provides an empirical study of congressional activity in the state and local tax area between January, 1971 and May, 1996. Specifically, it focuses first on four discrete but representative areas in which Congress has enacted legislation regulating state and local taxation, and, second, on four discrete but …

The Proposed Corporate Sponsorship Regulations: Is The Treasury Department "Sleeping With The Enemy"?, David A. Brennen

Law Faculty Scholarly Articles

In 1993, the Treasury Department (the Treasury) issued a proposed regulation outlining when money received by a charity from a corporate sponsor would be subject to federal income tax. In defining the phrase "trade or business," the proposed regulation addresses the extent to which sponsorship payments to charities will be treated by the Treasury as having been made in return for advertising on behalf of the sponsor, thus subjecting the payment to income tax. In the proposed regulation, the Treasury concludes that a charity's use of a corporate sponsor's name in the title of a charitable event is a mere …

The Relationship Of Federal Income Taxes To Toxic Wastes: A Selective Study, Richard A. Westin

Law Faculty Scholarly Articles

More demanding federal regulation, universal local opposition to waste treatment and disposal facilities, and increased long-term liabilities for waste sites have substantially restricted the supply of licensed waste handlers and have sharply increased the costs of waste disposal. As a result of increased costs and downstream liabilities for cleanup, industrial generators have begun to examine more closely their waste management practices and opportunities they may have to reduce the amount of hazardous waste they generate.

The urgent need to marshal the full range of industrial strategies to achieve significant reduction in the amount and toxicity of hazardous waste and the …

Dubious Interpretative Rules For Construing Federal Taxing Statutes, Richard A. Westin

Law Faculty Scholarly Articles

Knowing even a substantial portion of the Internal Revenue Code of 1954 is a major achievement. Divining how the courts might react to a complex tax transaction is also terribly difficult, but for this ability lawyers are often well-rewarded on earth. The tools of this esoteric trade include a mass of interpretative rules of a most uncertain nature, as sophisticated tax advisors are well aware. This article discusses the application and limits of a litany of the interpretative rules. The rules are frequently applicable outside the tax field, but the following study is confined to their application to tax decisions. …