Tax Law Commons^™

Solving Charity Failures, Brian L. Frye

Law Faculty Scholarly Articles

“Crowdfunding” is a way of using the Internet to raise money by asking the public to contribute to a project. In the past, asking a large number of people to contribute small amounts of money to a project was expensive and inefficient for most organizations and individuals. By greatly reducing transaction costs, crowdfunding enables anyone to inexpensively and efficiently seek small contributions to a project. While crowdfunding is a new model of fundraising, it has already transformed funding for the arts. For example, the crowdfunding platform Kickstarter distributed more than forty million dollars to the creators of almost seventy-five hundred …

Valuation In Light Of Uncertainty: How Stock Option Pricing Models Can Inform More Accurate Valuation Discounts For Built-In Gains, Rebecca N. Morrow

Kentucky Law Journal

No abstract provided.

Commentary: Hospital Tax-Exempt Policy: A Comparison Of Schedule H And State Community Benefit Reporting Systems, Laura L. Hitchcock

Frontiers in Public Health Services and Systems Research

In Hospital Tax-Exempt Policy: A Comparison of Schedule H and State Community Benefit Reporting Systems, Rosenbaum et aldescribe the numerous variations between current state law in 24 states and federal requirements regarding nonprofit hospitals’ community benefit activities. The potential for nonprofit hospitals to help shape community health is great, and how states choose to address requirements regarding community benefit, and potentially reinforce the new federal requirements to incentivize hospital participation in addressing root causes of poor health, should be of significant interest to the public, policy makers and public and population health experts, given the large percentage of …

Hospital Tax-Exempt Policy: A Comparison Of Schedule H And State Community Benefit Reporting Systems, Sara Rosenbaum, Maureen Byrnes, Amber M. Rieke

Frontiers in Public Health Services and Systems Research

The Patient Protection and Affordable Care Act (ACA) revises federal tax exemption standards for nonprofit hospitals by clarifying and augmenting their community benefit obligations. The ACA amendments followed the 2009 launch of Schedule H – the form on which hospital community benefit, financial, and institutional activities are reported and which must be appended to each facility’s annual Form 990 nonprofit institution information return. Schedule H effectively creates a nationwide, standardized, facility-specific, transparent, and fully publicly accessible reporting system covering the nation’s more than 2,900 nonprofit hospitals. Schedule H delineates financial assistance and bad debt, and requires identification of community health …

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 …

Taxation Of Unmined Coal In Kentucky, Jesse M. Parrish

Kentucky Journal of Equine, Agriculture, & Natural Resources Law

No abstract provided.

Horse Cents: A Tax Guide For Homeowners Offering Their Homes For Rent During The World Equestrian Games, Meghan Jackson Tyson

Kentucky Journal of Equine, Agriculture, & Natural Resources Law

No abstract provided.

The New Retiree Health Vebas, Kathryn L. Moore

Law Faculty Scholarly Articles

Granted tax exempt status since 1928, Voluntary Employees' Beneficiary Associations (VEBAs) have received considerable attention since the fall of 2007 when General Motors, Ford, and Chrysler reached separate landmark agreements with the United Auto Workers union pursuant to which the companies agreed to contribute billions of dollars to VEBAs in exchange for transferring their retiree health care liabilities to the VEBAs. Specifically, General Motors agreed to contribute $31.9 billion while Ford agreed to contribute $13.6 billion, and Chrysler agreed to contribute $11 billion. Sometimes referred to as "defeasance" VEBAs, these "new," "stand-alone" retiree health VEBAs, differ significantly from traditional VEBAs …

Topping V. Commissioner: An Example Of How An Equestrian Taxpayer Can Utilize "Single Activity" To Preclude The Irs "Hobby Loss" Challenge, Anna I. Garcia

Kentucky Journal of Equine, Agriculture, & Natural Resources Law

No abstract provided.

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 …

Social Security Reform: Fundamental Restructuring Or Incremental Change?, Kathryn L. Moore

Law Faculty Scholarly Articles

In light of Social Security's long-term deficit, reform of the system appears inevitable. Commentators and policymakers have offered a wide range of possible reforms. This Article describes and analyzes five possible types of reform: (1) individual accounts, (2) progressive price indexing, (3) general revenue and/or estate tax revenue financing, (4) increasing the maximum taxable wage base, and (5) increasing the normal retirement. The Article opposes the first two proposed changes, individual accounts and progressive price indexing, because they would fundamentally restructure the current system. The Article recommends that Social Security's financing difficulties be addressed by a combination of estate tax …

Introducing The Law Of Nonprofit Organizations And Philanthropy, David A. Brennen

Law Faculty Scholarly Articles

On January 5,2007, the Nonprofit and Philanthropy Law Section of AALS held its first program at the AALS Annual Meeting in Washington, D.C. The program, entitled "State-Level Legal Reform of the Law of Nonprofit Organizations," was a fitting way to launch what should prove to be a valuable contribution to the study of law relating to nonprofit organizations and philanthropy. This burgeoning area of academic legal study is well poised to grow by leaps and bounds in the coming years due to its impact on many traditional areas of legal study, including tax law, corporate law, estate law, trust law, …

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 …

12th Biennial Judge Joe Lee Bankruptcy Institute, Office Of Continuing Legal Education At The University Of Kentucky College Of Law

Continuing Legal Education Materials

Materials from the 12th Biennial Judge Joe Lee Bankruptcy Institute held May 2005.

President Bush's Personal Retirement Accounts: Saving Or Dismantling Social Security, Kathryn L. Moore

Law Faculty Scholarly Articles

President Bush has long been a proponent of investing a portion of payroll taxes in the private sector. For example, in 1999, then-Governor George Bush said to free-market crusader Stephen Moore, "I just want you to know ... that I'm really committed to these private investment accounts." In 2001, President Bush directed a 16-member bipartisan commission, the President's Commission to Strengthen Social Security, to formulate a plan for Social Security reform that included voluntary personal retirement accounts. But it was not until the beginning of his second term in office that President Bush began in earnest his crusade to fundamentally …

Motion For Leave To File Brief And Brief Of The National Taxpayers Union, The Nevada Manufacturers Association, The Howard Jarvis Taxpayers Foundation, Americans For Limited Government, Americans For Tax Reform, The Club For Growth, Nevada Corporate Headquarters, Inc., The Nevada Motor Transport Association, The Retail Association Of Nevada, And The Reno-Sparks Chamber Of Commerce, As Amici Curiae In Support Of Petitioners, Paul E. Salamanca

Law Faculty Advocacy

No abstract provided.

Race And Equality Across The Law School Curriculum: The Law Of Tax Exemption, David A. Brennen

Law Faculty Scholarly Articles

What is the relevance of race to tax law? The race issues are apparent when one studies a subject like constitutional law. The Constitution concerns itself explicitly with such matters as defining rights of citizenship, allocating powers of government, and determining rights with respect to property. Given the history of our country -- with slavery followed by periods of de jure and de facto racial discrimination -- these constitutional law matters obviously must have racial dimensions.

Tax law, however, does not generally concern itself explicitly with matters of race. Tax law is often thought of as completely race neutral in …

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 …

Business Law Reform In The United States: Thinking Too Small?, Douglas C. Michael

Law Faculty Scholarly Articles

Dean Johan Henning presents the South African experience with business entity reform as one part of a coordinated whole. It included, for example, government funding for business, tax reforms, accounting and securities changes. Henning says that these reforms, though multi-faceted, had a uniform purpose: to use small business as an engine to improve the economy and to move “historically and socially disadvantaged groups” into the mainstream of the economy and the society.

These are noble goals and far reaching efforts, and a lot to ask of business entity reform. But because the South African experience was nonetheless successful by all …

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 …

Kentucky Tax Law, Second Edition, Office Of Continuing Legal Education At The University Of Kentucky College Of Law, Thomas A. Brown, Timothy C. Kimmel, C. Christopher Muth, Douglas P. Romaine, Mark F. Sommer, Randy L. Treece

Continuing Legal Education Materials

A reference for Kentucky lawyers on real and personal property taxation, Kentucky sales and use taxation, Kentucky individual income taxation, corporate income taxation, and procedures before the Kentucky Board of Tax Appeals.

A Case For Congressional Facilitation Of A Collaborative Model Of Statutory Interpretation In The Tax Area: Lessons To Be Learned From The Corn Products And Arkansas Best Cases And The Historical Development Of The Statutory Definition Of "Capital Asset(S)", Myron C. Grauer

Kentucky Law Journal

No abstract provided.

The Double Standard Under Section 162: Why The Employee Business Deduction Is No Longer For Employees, Cheryl A. Cunagin

Kentucky Law Journal

No abstract provided.