Tax Law Commons^™

Harmonizing Federal Tax Law And The State Legalization Of Marijuana, Daniel Rowe

Loyola of Los Angeles Law Review

No abstract provided.

Four Walls Do Not An Eating Facility Make: Arguing Against The U.S. Tax Court's Unprecedented Jacobs V. Commissioner Decision, Brendan Zwaneveld

Loyola of Los Angeles Law Review

No abstract provided.

Taking Back Bitcoin, Zachary Segal

Touro Law Review

No abstract provided.

Is Anybody Home? The Relaxation Of The Residency Requirement For Claiming A Qualifying Child Under The Earned Income Tax Credit After Rowe V. Commissioner, Jennifer S. Hamel

Maine Law Review

Cynthia Rowe is currently serving a life sentence in prison for the shooting death of her brother-in-law. While she may have lost her criminal case, at least Rowe came away victorious in the recent Tax Court decision, Rowe v. Commissioner, in which she was awarded the earned income tax credit (EITC) over the objection of the Internal Revenue Service (Service or IRS). Unfortunately, her victory comes at the expense of sound legal analysis and public policy. Despite the efforts of Congress to ensure that the benefit of the EITC is given only to those who need it most by imposing …

Open Source: The Enewsletter Of Rwu Law 09-22-2017, Roger Williams University School Of Law

Life of the Law School (1993- )

No abstract provided.

Revisiting Erisa’S Church Plan Exemption After Advocate Health Care Network V. Stapleton, Emily Morrison

Northwestern University Law Review

For much of the last forty years, ERISA’s church plan exemption has existed quietly without much fanfare. But increased litigation over the last five years has dragged the exemption into the spotlight. The litigation focuses on religiously affiliated hospital systems and whether their pension plans have been correctly classified as church plans exempt from ERISA.

This Note examines the history behind the church plan exemption, including statutory modifications made in 1980 and the IRS’s longstanding interpretation of these changes, which precipitated the dispute at issue in the current wave of litigation. While the U.S. Supreme Court’s recent decision in Advocate …

Irs's Cp-2000 E-Mail Scams - Never In Dubai - Common In Canada & The Uk, Richard Thompson Ainsworth

Faculty Scholarship

On September 22, 2016 the Internal Revenue Service (IRS) and its Security Summit partners issued an alert to taxpayers and tax professionals to be on guard against fake e-mails purporting to contain a tax bill related to the Affordable Care Act. Surprisingly, this e-mail scam works. It really should not.

Modern technology is facilitating many contemporary tax scams. In recent years the US has seen false (refund) return scams, phone scammers impersonation IRS agents, and now e-mail scams with fraudulent CP-2000 notices attached to a demand for payment. The same phone and e-mail frauds have appeared in both Canada and …

Simplexity: Plain Language And The Tax Law, Joshua D. Blank, Leigh Osofsky

Articles

In recent years, federal government agencies have increasingly attempted to use plain language in written communications with the public. The Plain Writing Act of 2010, for instance, requires agencies to incorporate "clear and simple" explanations of rules and regulations into their official publications. In the tax context, as part of its "customer service" mission, the Internal Revenue Service bears a "duty to explain" the tax law to hundreds of millions of taxpayers who file tax returns each year. Proponents of the plain language movement have heralded this form of communication as leading to simplicity in tax compliance, more equitable access …

Apple State Aid Ruling: A Wrong Way To Enforce The Benefits Principle?, Reuven S. Avi-Yonah, G. Mazzoni

Articles

After an in-depth investigation, the European Commission concluded Ireland granted tax benefits of up to €13 billion to Apple in violation of the state aid rules. Ireland must now recover the illegal aid. That decision has been criticized by Treasury Secretary Jacob Lew, who believes that only the IRS has the right to tax Apple's foreign income, since most of the company's R&D took place in the U.S. However, that is not how the big EU countries, where sales are made, see things. Who is right?

This article seeks to answer that question by analyzing the impact of the U.S. …

Beyond Polemics: Poverty, Taxes, And Noncompliance, Michelle Lyon Drumbl

Scholarly Articles

The earned income tax credit (EITC) is perhaps the most significant refundable credit in the U.S. tax system. Designed as an anti-poverty program, it is a social benefit administered by the Internal Revenue Service (IRS). Studies show it has a positive impact upon the children whose families receive it. Despite its many positives, however, the EITC is a program that for years has been plagued by taxpayer noncompliance. Though it is believed that the majority of EITC noncompliance may be unintentional, public reports of misconduct and fraud hurt the program’s image and fuel political rhetoric.

This article unpacks the rhetoric. …

Rejecting Charity: Why The Irs Denies Tax Exemption To 501(C)(3) Applicants, Terri Lynn Helge

Faculty Scholarship

New charitable organizations generally must file an application for exemption (Form 1023) and await approval from the Internal Revenue Service. Unfortunately, the criteria the Internal Revenue Service uses to evaluate applications has not always been transparent. If an application is approved, the Internal Revenue Service determination letter and the application for exemption are required to be made publicly available and can be requested from the Internal Revenue Service or the organization itself. Prior to 2004, in the case of denials, neither the application nor the Internal Revenue Service’s correspondence setting forth its rationale for the denial were made publicly available. …

Qualified Residence Interest Deduction: A Win For Unmarried Co-Owners, Christine Manolakas

Nevada Law Journal

Despite the seemingly simple language of the statute, the interpretation of the home mortgage interest deduction has recently garnered much attention as the Internal Revenue Service and the courts grappled with its application to unmarried co-owners of a residence. In determining whether the indebtedness limitations apply on a “per-residence” or “per-taxpayer” basis, the Internal Revenue Service, the Tax Court, and the Ninth Circuit have conducted in-depth analysis of the language of the statute, the statute’s legislative history, implications of related tax provisions, social and policy concerns, and financial consequences, and have consulted almost every canon of statutory interpretation. This Article …

Getting Back To The "Grassroots" Of Tax Administration: Because "We The People" Long For A Gathering Of American Eagles To Restore Trust In The Internal Revenue Service With A Rebuild Irs Initiative, Frank Wolpe

Akron Law Review

Like America, our Internal Revenue Service is a work in progress. Yet, for best results, it’s better to avoid thinking too much about what it is or is not! Instead, let’s think more about what the IRS ought to be! This Article thusly offers a realistic path forward with new choices for a local presence, which once again makes it taxpayer/customer-centric. For more effective tax administration, it also offers a return to something that inexcusably went missing in 1998: senior-executive “on-site oversight” of field operations.

If today’s Internal Revenue Service can be fairly described as an exploding volcano …

Bringing Continuity To Cryptocurrency: Commercial Law As A Guide To The Asset Categorization Of Bitcoin, Evan Hewitt

Seattle University Law Review

This Note will undertake to analyze bitcoin under the Uniform Commercial Code (UCC) and the Internal Revenue Code (IRC)—two important sources of commercial law—to see whether any existing asset categories adequately protect bitcoin’s commercial viability. This Note will demonstrate that although commercial law dictates that bitcoin should—nay must—be regulated as a currency in order to sustain its existence, the very definition of currency seems to preclude that from happening. Therefore, this Note will recommend that we experiment with a new type of asset that receives currency-like treatment, specifically designed for cryptocurrencies, under which bitcoin can be categorized in order to …

The Perfect Process Is The Enemy Of The Good Tax: Tax's Exceptional Regulatory Process, Stephanie Mcmahon

Faculty Articles and Other Publications

Many courts and academics critique existing tax exceptionalism or the ability of the federal income tax to be created, applied, or interpreted differently from other laws. Critics have successfully complained that the Treasury Department, and the IRS as a bureau of the Department, issues guidance implementing the Internal Revenue Code using different processes from those required by the Administrative Procedure Act (APA). At the same time, courts are increasing the level of deference given to this guidance to conform to that given other agencies. This article responds to these critics by urging they re-focus their attention on the objectives of …

Fragmented Oversight Of Nonprofits In The United States: Does It Work? Can It Work?, Lloyd Hitoshi Mayer

Journal Articles

Previously Brendan Wilson and I concluded that oversight of nonprofit governance would be most effective if it remained the responsibility of the states, although it would benefit from both a federal funding mechanism and enhanced coordination with the Internal Revenue Service.' More recently I concluded that oversight of federal tax exemption would be better served if Congress shifted the locus of that oversight to a national, self-regulatory organization working in close cooperation with the IRS given the perennial financial and other limitations faced by the IRS.2 What neither of these earlier articles addressed, however, was whether the current split of …

Unilateral Responses To Tax Treaty Abuse: A Functional Approach, Omri Marian

Brooklyn Journal of International Law

In recent years, there has been a dramatic increase in the attention given to abusive tax schemes that take advantage of bilateral tax treaties. The ensuing discourse tends to view potential responses to treaty abuses as a hierarchical set of options, gradually escalating, in which treaty termination is a last resort option. This article argues that the hierarchical view of unilateral responses to treaty abuse is misguided. Unilateral responses to treaty-based abuse are not hierarchically ordered. Rather, the approach to treaty abuse is (and should be) functional, adopting specific types of unilateral responses based on the type of treaty abuse …

Irresponsibly Taxing Irresponsibility: The Individual Tax Penalty Under The Affordable Care Act, Francine J. Lipman, James Owens

Scholarly Works

In recent decades, Congress has used the federal income tax system increasingly to administer and deliver social benefits. This transition is consistent with the evolution of the American welfare system into workfare over the last several decades. As more and more social welfare benefits are conditioned upon work, family composition, and means-tested by income levels, the income tax system where this data is already systematically aggregated, authenticated, and processed has become the go-to administrative agency.

Nevertheless, as the National Taxpayer Advocate Nina Olson has noted there are “substantial differences between benefits agencies and enforcement agencies in terms of culture, mindset, …

Employee Medical Reimbursement Plans In The Age Of Erisa, Robert D. Rosewater

Akron Law Review

THE EMPLOYEE MEDICAL reimbursement plan presents a new dimension in the spectrum of available corporate fringe benefits. Its attractiveness lies in the relative ease by which the plan may be adopted and administered as well as the favorable federal income tax consequences to both the corporation and its participating employees. These plans undoubtedly will proliferate as other traditional fringe benefits become less attractive due to changes in tax laws,2 as medical expenses continue to increase, and as the advantages of employee medical reimbursement plans become more widely known. The scope of this article is to discuss the purposes of these …

Trading With Related Foreign Entitites: Current American Tax Perspective, Mortimer Caplin

Akron Law Review

This article attempts to summarize existing United States tax law and government policy on arm's-length dealing, with the hope that it will illuminate the current perspective in this important and complex area

Nontaxpayer Suits: Seeking Injunctive And Declaratory Relief Against Irs Administrative Action, John A. Lynch

Akron Law Review

Who should be entitled to challenge Internal Revenue Service (IRS) tax policy decision making? Should the concerned citizen or the aggrieved competitor of a company receiving favorable treatment from the IRS be precluded from seeking review of allegedly illegal action when his own taxes are not specifically involved? ...

It is clear from an analysis of recent decisions that several federal courts have been unwilling to accept the proposition that the Anti-Injunction Act and the Declaratory Judgment Act exception insulate the IRS from judicial scrutiny even when judicial intervention would pose no threat to federal revenues. An analysis of the …

Internal Revenue Service Review Of Tax Accrual Workpapers United States V. Arthur Young & Co., Steven Dimengo

Akron Law Review

The broad summoning power of the Internal Revenue Service [IRS] which enables it to examine any documents related to a taxpayer's liability' was challenged in United States v. Arthur Young & Co. The major issue of the proceedings was whether tax accrual workpapers, prepared by a taxpayer's independent auditor during the course of an annual audit, were subject to disclosure to the IRS pursuant to a summons under section 7602 of the Internal Revenue Code of 1954. In reaching its holding, the Supreme Court had to determine whether tax accrual workpapers were relevant to an IRS inquiry within the meaning …

Dickman And Code Section 7872: The Death Knell To Interest-Free And Below-Market Loans, Beverly Mcdonel

Akron Law Review

This comment will discuss the history of interest-free and below-market rate loans, including recent changes in the law from Dickman and the Internal Revenue Code (Code) revision in 1984. In addition, some of the tax planning alternatives to interest-free loans will be briefly examined.

Carroll V. Commissioner: Narrow Judicial Interpretations Of Internal Revenue Code' § 7502 May Cause Increased Burden On Taxpayers, Nicole D. Stanger

Akron Law Review

In Carroll v. Commissioner, the United States Court of Appeals for the Sixth Circuit upheld the minority viewpoint that the statute repeals the common law presumption of delivery in all cases other than those where the taxpayer used registered or certified mail. Thus, taxpayers who do not send tax documents using registered or certified mail must bear the risk of nondelivery. Critics of this decision contend that the court misinterpreted the I.R.C. As a result of the court's narrow interpretation, taxpayers may suffer substantial tax losses and penalties even when a document is lost through no fault of their own. …

Commissioner Of Internal Revenue V. Lundy: Transforming "An Intended Benefit Into A Handicap"?, Douglas Edwards

Akron Law Review

This Note analyzes the Court's decision in Lundy. Part II examines the relevant statutory provisions concerning the power granted to the Tax Court and federal district court. Part III addresses the facts, procedural history, and holding of the Court." Part IV(A) analyzes the holding of the case. Part IV(B) addresses several dissenting arguments, and contends that the Court could have clarified this murky area of the law by adopting the holding of Miller v. United States.

Exile To Main Street: The I.R.S.'S Diminished Role In Overseeing Tax-Exempt Organizations, Evelyn Brody, Marcus Owens

Chicago-Kent Law Review

The Internal Revenue Service’s post-Citizens United approach to political activity by would-be tax-exempt organizations has threatened the financial health of the entire agency. Suffering from a siege mentality in the best of times, the IRS predictably and understandably responded to the asserted “scandal” by retreating into a shell of bureaucratic reshuffling, management mumbo-jumbo, and paper moving. A fresh cadre of senior management lacking relevant experience has overhauled the exempt-organization function and emphasized granting recognition of exemption now and (possibly) asking questions later. The new self-certification process of exemption for small charities could also be setting the agency up for the …

Politics, Disclosure, And State Law Solutions For 501(C)(4) Organizations, Linda Sugin

Chicago-Kent Law Review

Since the Supreme Court’s 2010 decision in Citizens United v. FEC, there has been an explosion in section 501(c)(4) organizations active in politics. Unable to effectively process applications, the IRS mishandled organizations with conservative political ties, producing a scandal from which the agency has yet to recover. It proposed regulations that would have helped it more easily determine eligibility for 501(c)(4) exemption, but after massive public outcry, the regulations were withdrawn. No new regulations will be proposed before the 2016 presidential election.

Given the federal government’s inability to address the problem of dark money politicking by 501(c)(4) organizations through …

Fragmented Oversight Of Nonprofits In The United States: Does It Work? Can It Work?, Lloyd Hitoshi Mayer

Chicago-Kent Law Review

The United States is well known for its distinctive, although not unique, division of political authority between the federal government and the various states. This division is particularly evident when it comes to oversight of nonprofit organizations. The historical focus of federal government oversight has been limited primarily to qualification for tax exemption and other tax benefits, with more plenary power resting with state authorities. Over time, however, the federal government’s role has come to overlap significantly with that of the states, and many nonprofits have become subject to regulation by multiple states as their operations and donor bases expand …

A Tax Audible: Coaches And Buyouts, Jeffrey H. Kahn

Scholarly Publications

No abstract provided.

Tax Whistleblower Statute: Obtaining Meaningful Appeals Through The Appropriate Scope Of Review, Matthew R. Stock

Florida State University Law Review

No abstract provided.