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Tax credits

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Full-Text Articles in Law

Tax Benefits And Fairness In K–12 Education, Linda Sugin Jan 2023

Tax Benefits And Fairness In K–12 Education, Linda Sugin

Faculty Scholarship

This Article examines the tax law’s subsidies for inequality and segregation in primary and secondary education, analyzing the federal charitable deduction and education savings plans, and state tax credits for education. It argues that the tax system diverts funds from traditional public education into private education, fostering economic, racial, religious, and political separation. The tax law also operates to increase resource inequality within public education by subsidizing schools that affluent children attend. In a novel analysis, the Article contends that the jurisprudence around the charitable deduction for education—though longstanding—is legally incoherent, and argues that no deduction should ever be allowed …


Income Inequality, Progressive Taxation And Tax Expenditures, James R. Hines Jr. Apr 2020

Income Inequality, Progressive Taxation And Tax Expenditures, James R. Hines Jr.

Book Chapters

There are important and growing concerns about income inequality in the United States and other high-income countries. These concerns reflect rising apprehension about the political and social consequences of inequality and worries that the advance of technology, expanding international trade and investment, and other economic developments may have significantly widened income gaps in recent decades and will continue to do so in the future. In the United States, these concerns have prompted renewed calls for political activism and vigorous searches for policy measures that might improve the relative economic positions of low- and middle-income Americans.

There are many ways in …


Clean Energy Equity, Felix Mormann May 2019

Clean Energy Equity, Felix Mormann

Faculty Scholarship

Solar, wind, and other clean, renewable sources of energy promise to mitigate climate change, enhance energy security, and foster economic growth. But many of the policies in place to promote clean energy today are marred by an uneven distribution of economic opportunities and associated financial burdens. Tax incentives for renewables cost American taxpayers billions of dollars every year, yet the tax code effectively precludes all but the largest banks and most profitable corporations from reaping the benefits of these tax breaks. Other policies, such as renewable portfolio standards that set minimum quota to create demand for renewable electricity require such …


America's (D)Evolving Childcare Tax Laws, Shannon Weeks Mccormack Jan 2019

America's (D)Evolving Childcare Tax Laws, Shannon Weeks Mccormack

Articles

Proponents have touted the ability of the Tax Cuts and Jobs Act (the TCJA) — enacted in the twilight of 2017 — to help American working families. But while the TCJA expanded some benefits available to parents with dependent children, these parental tax benefits may be claimed regardless of whether or to what extent childcare costs are incurred to work outside the home. To help working parents with these costs (which are often their largest expense), Congress might have turned to two other mechanisms in the tax law — the “child and dependent care credit” and the “dependent care exclusion.” …


Caveat Irs: Problems With Abandoning The Full Deduction Rule, David Gamage, Joseph Bankman, Jacob Goldin, Daniel J. Hemel, Darien Shanske, Kirk J. Stark, Dennis J. Ventry Jr., Manoj Viswanathan Jan 2018

Caveat Irs: Problems With Abandoning The Full Deduction Rule, David Gamage, Joseph Bankman, Jacob Goldin, Daniel J. Hemel, Darien Shanske, Kirk J. Stark, Dennis J. Ventry Jr., Manoj Viswanathan

Articles by Maurer Faculty

Several states have passed — and many more are considering — new tax credits that would reduce tax liability based on donations made by a taxpayer in support of various state, local or non-profit programs. In general, taxpayer contributions to qualifying organizations — including public charities and private foundations, as well as federal, state, local, and tribal governments — are eligible for the federal charitable contribution deduction under section 170. In a previous article, we explained how current law supports the view that qualifying charitable contributions are deductible under section 170, even when the donor derives some federal or state …


Three Words And The Future Of The Affordable Care Act, Nicholas Bagley Oct 2015

Three Words And The Future Of The Affordable Care Act, Nicholas Bagley

Articles

As an essential part of its effort to achieve near universal coverage, the Affordable Care Act (ACA) extends sizable tax credits to most people who buy insurance on the newly established health care exchanges. Yet several lawsuits have been filed challenging the availability of those tax credits in the thirty-four states that refused to set up their own exchanges. The lawsuits are premised on a strained interpretation of the ACA that, if accepted, would make a hash of other provisions of the statute and undermine its effort to extend coverage to the uninsured. The courts should reject this latest effort …


No Good Options: Picking Up The Pieces After King V. Burwell, Nicholas Bagley, David K. Jones Apr 2015

No Good Options: Picking Up The Pieces After King V. Burwell, Nicholas Bagley, David K. Jones

Articles

If the Supreme Court rules against the government in King v. Burwell, insurance subsidies available under the Affordable Care Act (ACA) will evaporate in the thirty-four states that have refused to establish their own health-care exchanges. The pain could be felt within weeks. Without subsidies, an estimated eight or nine million people stand to lose their health coverage. Because sicker people will retain coverage at a much higher rate than healthier people, insurance premiums in the individual market will surge by as much as fifty percent. Policymakers will come under intense pressure to mitigate the fallout from a government loss …


Minority And Women Entrepreneurs: Building Capital, Networks, And Skills, Michael S. Barr Mar 2015

Minority And Women Entrepreneurs: Building Capital, Networks, And Skills, Michael S. Barr

Other Publications

The United States has an enviable entrepreneurial culture and a track record of building new companies. Yet new and small business owners often face particular challenges, including lack of access to capital, insufficient business networks for peer support, investment, and business opportunities, and the absence of the full range of essential skills necessary to lead a business to survive and grow. Women and minority entrepreneurs often face even greater obstacles. While business formation is, of course, primarily a matter for the private sector, public policy can and should encourage increased rates of entrepreneurship, and the capital, networks, and skills essential …


Predicting The Fallout From King V. Burwell - Exchanges And The Aca, Nicholas Bagley, David K. Jones, Timothy Stoltzfus Jost Jan 2015

Predicting The Fallout From King V. Burwell - Exchanges And The Aca, Nicholas Bagley, David K. Jones, Timothy Stoltzfus Jost

Articles

The U.S. Supreme Court's surprise announcement on November 7 that it would hear King v. Burwell struck fear in the hearts of supporters of the Affordable Cara Act (ACA). At stake is the legality of an Internal Revenue Service (IRS) rule extending tax credits to the 4.5 million people who bought their health plans in the 34 states that declined to establish their own health insurance exchanges under the ACA. The case hinges on enigmatic statutory language that seems to link the amount of tax credits to a health plan purchased "through an Exchange established by the State." According to …


Tax Credits On Federally Created Exchanges: Lessons From A Legislative Process Failure Theory Of Statutory Interpretation, Mark Seidenfeld Jan 2015

Tax Credits On Federally Created Exchanges: Lessons From A Legislative Process Failure Theory Of Statutory Interpretation, Mark Seidenfeld

Scholarly Publications

Opponents to the Patient Protection and Affordable Care Act (ACA or Act) have mounted yet another seemingly formidable challenge to basic provisions of the Act, focusing on whether the Act authorizes insurance premium tax credits for individuals who obtain insurance on an American Health Benefit Exchange (Exchange) established by the federal government. The argument against construing the Act to allow such tax subsidies depends largely on applying technical tools of statutory interpretation, usually associated with the Textual school of interpretation, to various provisions of the Act to discern that the best objective reading authorizes premium tax credits only to individuals …


Foreword--King V. Burwell Symposium: Comments On The Commentaries (And On Some Elephants In The Room), David Gamage Jan 2015

Foreword--King V. Burwell Symposium: Comments On The Commentaries (And On Some Elephants In The Room), David Gamage

Articles by Maurer Faculty

This invited essay reviews the pieces submitted for the Pepperdine Law Review symposium on the King v. Burwell case. The thrust of this essay's response commentary is to praise the submitted essays for their excellence and insightfulness, but to suggest that the submitted essays nonetheless might benefit from focusing more on the role of the political mobilization that resulted in the King v. Burwell dispute. Ultimately, this essay suggests that what may have motivated the Supreme Court to develop and apply its new "deep economic and political significance" test in this this case may not have been anything inherent to …


Prompt On The King V. Burwell Case, David Gamage Jan 2015

Prompt On The King V. Burwell Case, David Gamage

Articles by Maurer Faculty

Once again, the U.S. Supreme Court will be deciding the fate of Obamacare — in the case of King v. Burwell. Also, once again, the future of American healthcare reform will turn on how the Supreme Court reviews a provision of Obamacare that was enacted through the tax code.

So far, the debates over King v. Burwell have largely focused on Constitutional law, Administrative law, and other non-tax-law considerations. Might there be unique tax law perspectives that could be brought in to better illuminate these debates? Does it matter that the provision being reviewed (I.R.C. Sec. 36B) was enacted through …


Beyond Tax Credits: Smarter Tax Policy For A Cleaner, More Democratic Energy Future, Felix Mormann Jan 2014

Beyond Tax Credits: Smarter Tax Policy For A Cleaner, More Democratic Energy Future, Felix Mormann

Articles

Solar, wind, and other renewable energy technologies have the potential to mitigate climate change, secure America's energy independence, and create millions of green jobs. In the absence of a price on carbon emissions, however, these long-term benefits will not be realized without near-term policy support for renewable energy. This Article assesses the efficiency of federal tax incentives for renewables and proposes policy reform to promote renewable energy more cost-effectively through capital markets and crowdfunding.

Federal support for renewable energy today comes primarily in the form of accelerated depreciation and, critically, tax credits. Empirical evidence reveals that only a fraction of …


Why The Affordable Care Act Authorizes Tax Credits On The Federal Exchanges, David Gamage, Darien Shanske Jan 2014

Why The Affordable Care Act Authorizes Tax Credits On The Federal Exchanges, David Gamage, Darien Shanske

Articles by Maurer Faculty

This Essay refutes Adler’s and Cannon’s argument that the Affordable Care Act (“Obamacare”) does not authorize premium tax credits for insurance policies purchased from the federal healthcare Exchanges. Adler’s and Cannon’s argument is the basis of challenges in a number of ongoing lawsuits, including Oklahoma ex rel. Pruitt v. Sebelius and Halbig v. Sebelius. This Essay conducts a textual analysis of the Affordable Care Act and concludes that the text clearly authorizes premium tax credits for insurance policies purchased from the federal healthcare Exchanges.

On November 7th, 2014, the U.S. Supreme Court agreed to hear the appeal of the King …


Should The Us Dictate World Tax Policy? Reflections On Ppl, Reuven S. Avi-Yonah Feb 2013

Should The Us Dictate World Tax Policy? Reflections On Ppl, Reuven S. Avi-Yonah

Articles

The U.S. Supreme Court’s decision to grant certiorari in PPL offers it a unique opportunity to change the law regarding foreign tax credits that has significantly impeded the ability of other countries to engage in meaningful tax reform. In 1938 the Court said in dicta that to qualify for the FTC a tax had to be an income or excess profits tax (or a tax imposed in lieu thereof) under U.S. tax principles. This statement has led to an elaborate set of regulations defining what is an income tax, which has significantly hampered the ability of foreign countries to adopt …


The Great And Mighty Tax Law: How The Roberts Court Has Reduced Constitutional Scrutiny Of Taxes And Tax Expenditures, Linda Sugin Jan 2013

The Great And Mighty Tax Law: How The Roberts Court Has Reduced Constitutional Scrutiny Of Taxes And Tax Expenditures, Linda Sugin

Faculty Scholarship

This article compares National Federation of Independent Business v. Sebelius – the Supreme Court’s decision upholding the individual mandate in Obamacare as a tax, with Arizona Christian Schools v. Winn – the Supreme Court’s decision denying standing to taxpayers with an Establishment Clause challenge to a state tax credit. It argues that these cases aggravate a growing tension between the economic and legal analyses of taxation by reducing the legal significance of economic analysis in constitutional cases. It suggests that Arizona Christian Schools was a truly radical decision because it conceptualized tax expenditures as private action immune from constitutional attack, …


Taxation Without Representation: The Illegal Irs Rule To Expand Tax Credits Under The Ppaca, Jonathan H. Adler, Michael F. Cannon Jan 2013

Taxation Without Representation: The Illegal Irs Rule To Expand Tax Credits Under The Ppaca, Jonathan H. Adler, Michael F. Cannon

Faculty Publications

The Patient Protection and Affordable Care Act (PPACA) provides tax credits and subsidies for the purchase of qualifying health insurance plans on state-run insurance exchanges. Contrary to expectations, many states are refusing or otherwise failing to create such exchanges. An Internal Revenue Service (IRS) rule purports to extend these tax credits and subsidies to the purchase of health insurance in federal exchanges created in states without exchanges of their own. This rule lacks statutory authority. The text, structure, and history of the Act show that tax credits and subsidies are not available in federally run exchanges. The IRS rule is …


Mobilizing Public Markets To Finance Renewable Energy Projects: Insights From Expert Stakeholders, Paul Schwabe, Michael Mendelsohn, Felix Mormann, Douglas J. Arent Jun 2012

Mobilizing Public Markets To Finance Renewable Energy Projects: Insights From Expert Stakeholders, Paul Schwabe, Michael Mendelsohn, Felix Mormann, Douglas J. Arent

Faculty Scholarship

Financing renewable energy projects in the United States can be a complex, time consuming, and expensive process. Currently, most equity investment in new renewable power production facilities is supported by tax credits and accelerated depreciation benefits, and is constrained by the pool of potential investors that can fully use these tax benefits and are willing to engage in complex financial structures. For debt financing, non-government lending to renewables has largely been provided by foreign banks that may be under future lending constraints due to economic and regulatory conditions.

To discuss these and other renewable energy financing challenges and to identify …


Slicing The Shadow: A Proposal For Updating U.S. International Taxation, Reuven S. Avi-Yonah Jun 2012

Slicing The Shadow: A Proposal For Updating U.S. International Taxation, Reuven S. Avi-Yonah

Articles

In the article Avi-Yonah proposed that the United States tax multinational corporations using a formulary apportionment system based solely on income derived from sales. The background for the article was drawn principally from Robert Reich’s The Work of Nations (1991), and the analysis was inspired by Stanley I. Langbein’s work on transfer pricing, especially his seminal article "The Unitary Method and the Myth of Arm’s Length," Tax Notes, Feb. 17, 1986, p. 625; see also Louis Kauder, "Intercompany Pricing and Section 482: A Proposal to Shift From Uncontrolled Comparables to Formulary Apportionment Now," Tax Notes, Jan. 25, 1993, p. 485.


Evaluating The Performance Of The U.S. Social Safety Net In The Great Recession, Keith Gunnar Bentele Apr 2012

Evaluating The Performance Of The U.S. Social Safety Net In The Great Recession, Keith Gunnar Bentele

Center for Social Policy Publications

The following provides an assessment of the performance of both individual safety net programs and the cumulative impact of all safety net benefits and tax credits on household incomes in the early years during and following the 2007-09 recession. Specifically, I examine the extent to which various benefits and tax credits have moderated the impact of earnings losses for households in different positions in the income distribution, with special attention to the experiences of low-income households. In addition, I examine whether these moderating impacts differ for households of various racial/ethnic compositions, female-headed households, and residents of states with more and …


Behaviorally Informed Regulation, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir Jan 2012

Behaviorally Informed Regulation, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir

Book Chapters

Policy makers typically approach human behavior from the perspective of the rational agent model, which relics on normativc, a priori analyses. The model assumes people make insightful, well-planned, highly controlled, and calculated decisions guided by considerations of personal utility. This perspective is promoted in the social sciences and in professional schools and has come to dominate much of the formulation and conduct of policy. An alternative view, developed mostly through empirical behavioral research, and the one we will articulate here, provides a substantially difierent perspective on individual behavior and its policy and regulatory implications. According to the empirical perspective, behavior …


The Case For Tradable Tax Credits, Clint Wallace Oct 2011

The Case For Tradable Tax Credits, Clint Wallace

Faculty Publications

This note argues that tradable tax credits offer advantages as compared to other mechanisms the federal government can use to affect social and economic policy. Policymakers should consider the tradable tax credit as a potentially desirable form of tax incentive, rather than a necessity of political compromise as was the case in the enactment of existing tradable credits. First, the note establishes that tradable tax credits can be the economic equivalent of direct spending programs and of refundable tax credits. Next, the note examines a limited but significant set of circumstances in which the tradable tax credit can offer efficiency …


A Winn For Educational Pluralism, Nicole Stelle Garnett Jan 2011

A Winn For Educational Pluralism, Nicole Stelle Garnett

Journal Articles

This short essay takes as its starting point on the Supreme Court’s recent decision in Winn v. Arizona Christian Tuition Organization, which involved an Establishment Clause challenge to Arizona’s scholarship tax program — a school-choice device that provides tax credits from state income taxes for donations to organizations granting scholarship to private K-12 schools. In Winn, a divided court ruled that taxpayers lack standing to challenge this and other tax credit programs — thereby dramatically limiting the Flast v. Cohen exception to the no-taxpayer-standing rule. The essay makes the case that the Winn will promote authentic educational pluralism by clearing …


The Case For Behaviorally Informed Regulation, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir Jan 2009

The Case For Behaviorally Informed Regulation, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir

Book Chapters

Policymakers approach human behavior largely through the perspective of the “rational agent” model, which relies on normative, a priori analyses of the making of rational decisions. This perspective is promoted in the social sciences and in professional schools, and has come to dominate much of the formulation and conduct of policy. An alternative view, developed mostly through empirical behavioral research, provides a substantially different perspective on individual behavior and its policy implications. Behavior, according to the empirical perspective, is the outcome of perceptions, impulses, and other processes that characterize the impressive machinery that we carry behind the eyes and between …


Policies To Expand Minority Entrepreneurship: Closing Comments, Michael S. Barr Jan 2008

Policies To Expand Minority Entrepreneurship: Closing Comments, Michael S. Barr

Book Chapters

This essay is based on comments delivered at the Conference on on Entrepreneurship in Low- and Moderate-Income Communities, November 3-4, 2005. This has been a productive conversation. In my closing comments, I want to shift our focus somewhat, from entrepreneurship in low-income communities to minority entrepreneurship generally. I want to do so because many minority entrepreneurs are connected to or hire from low-income communities, and because minority entrepreneurs face critical barriers even when they attempt to create and grow firms outside of distressed communities. In this comment, I want to highlight key barriers and suggest five steps for Congress, the …


Banking The Poor: Overcoming The Financial Services Mismatch, Michael S. Barr Jan 2007

Banking The Poor: Overcoming The Financial Services Mismatch, Michael S. Barr

Book Chapters

Low-income households often lack access to bank accounts and face high costs for transacting basic financial services through check cashers and other alternative financial service providers. Twenty-two percent of low- and moderateincome American households do not have a checking or savings account. Many other "underbanked" families have bank accounts but still rely on high-cost financial services. These households find it more difficult to save and plan financially for the future. Living paycheck to paycheck leaves them vulnerable to medical or job emergencies that may endanger their financial stability, and lack of longer-term savings undermines their ability to improve skills, purchase …


Comparative Fiscal Federalism: What Can The U.S. Supreme Court And The European Court Of Justice Learn From Each Other's Tax Jurisprudence?, Reuven S. Avi-Yonah Jan 2006

Comparative Fiscal Federalism: What Can The U.S. Supreme Court And The European Court Of Justice Learn From Each Other's Tax Jurisprudence?, Reuven S. Avi-Yonah

Articles

In October 2005, a group of distinguished tax experts from the European Union and the United States, who had never met before, convened at the University of Michigan Law School for a conference on "Comparative Fiscal Federalism: Comparing the U.S. Supreme Court and European Court of Justice Tax Jurisprudence." The purpose of the conference was to shed comparative light on the very different approaches taken by the European Court of Justice (ECJ) and the U.S. Supreme Court to the question of fiscal federalism. The conference was sponsored by the U-M Law School, U-M's European Union Center, and Harvard Law School's …


Passport To Toledo: Cuno, The World Trade Organization, And The European Court Of Justice, Reuven S. Avi-Yonah Dec 2005

Passport To Toledo: Cuno, The World Trade Organization, And The European Court Of Justice, Reuven S. Avi-Yonah

Articles

The purpose of this article is to try to place the debate about Cuno v. DaimlerChrysler in a broader perspective by connecting it with the overall discussion of harmful tax competition. It discusses two hypothetical scenarios under which the city of Toledo, Ohio, is (a) a separate country and (b) a member state of the European Union. If the first hypothetical were true, the tax incentives offered by Toledo would violate the rules of the World Trade Organization; if the second hypothetical were true, the tax incentives would also violate the Treaty of Rome, as interpreted by the European Court …


Keynote Address, John Watts Apr 2002

Keynote Address, John Watts

Coalbed Methane Development in the Intermountain West (April 4-5)

5 pages.


Cbm Development From The County Perspective, Josh Joswick Apr 2002

Cbm Development From The County Perspective, Josh Joswick

Coalbed Methane Development in the Intermountain West (April 4-5)

4 pages.