Taxation-Federal Commons^™

Permitting Abused Spouses To Claim The Earned Income Tax Credit In Separate Returns, Fred B. Brown

All Faculty Scholarship

The earned income tax credit (EITC) is a refundable tax credit for federal income tax purposes that is generally available to lowincome taxpayers who have income from either employment or selfemployment. The EITC is currently the largest government program providing aid to low-income individuals. The subsidy provided by the EITC is of particular importance to individuals subjected to domestic abuse, given that such individuals are often impoverished, and the EITC can provide them with the financial resources necessary to improve, endure, or leave an abusive relationship.

Despite the importance of the EITC, married individuals subjected to domestic abuse face serious …

The Hidden Costs Of Cliff Effects In The Internal Revenue Code And Proposals For Change, Manoj Viswanathan

Faculty Scholarship

Cliff effects in the Internal Revenue Code trigger a sudden increase of federal tax liability when some attribute of a taxpayer—most commonly income—exceeds a particular threshold value. As a result, two taxpayers in nearly identical economic situations can face considerably different tax liabilities depending on which side of the triggering criterion they fall. The magnitude of the equity and efficiency costs associated with cliff effects is significant: cliff effects are attached to tax provisions amounting to hundreds of billions of dollars, the majority of which are targeted at low- and moderate-income taxpayers. Cliff effects have received little attention in legal …

An Argument In Support Of Tax-Free Per-Cap Distribution Payments Derived From Native American Nations Gaming Sources, 37 N. Ill. U. L. Rev. 66 (2016), Arthur Acevedo

UIC Law Open Access Faculty Scholarship

Gaming activities play important social, cultural, and economic roles for many Native American tribes. During the 1970s and 1980s, gaming activities spread throughout the country, and became more accessible to nonnative individuals. This growth in gaming activities drew the attention of state and local officials who sought to limit and regulate Native American gaming. In California v. Cabazon Band of Mission Indians, the State of California, arguing before the Supreme Court, asserted that it could exercise jurisdiction over Native American gaming activities. In a stunning defeat, the Supreme Court ruled against the State of California when it announced its decision …

Cancellation Of Debt And Related Transactions, Jeffrey H. Kahn

Scholarly Publications

No abstract provided.

Dear I.R.S., It Is Time To Enforce The Campaigning Prohibition. Even Against Churches, Samuel Brunson

Faculty Publications & Other Works

In 1954, Congress prohibited tax-exempt public charities, including churches, from endorsing or opposing candidates for office. To the extent a tax-exempt public charity violated this prohibition, it would no longer qualify as tax-exempt, and the IRS was to revoke its exemption.

While simple in theory, in practice, the IRS rarely penalizes churches that violate the campaigning prohibition and virtually never revokes a church's tax exemption. And, because no taxpayer has standing to challenge the IRS's inaction, the IRS has no external imperative to revoke the exemptions of churches that do campaign on behalf of or against candidates for office.

This …

Taxing Utopia, Samuel Brunson

Faculty Publications & Other Works

Nineteenth-century American religious movements challenged many aspects of American society. Although their challenges to mainstream America's vision of sex and marriage remain the best-known aspects of many of these groups, their challenges to traditional American economics are just as important. Eschewing individual ownership of property, many of these new Christian movements followed the New Testament model of a body of believers that held all property in common.

In the early twentieth century, these religious communal groups had to contend with something new: an income tax. Communalism did not fit into the individualistic economic system envisioned b-y the drafters of the …

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, …

Reconciling The Premium Tax Credit: Painful Complications For Lower And Middle-Income Taxpayers, Francine J. Lipman, James E. Williamson

Scholarly Works

The Patient Protection and Affordable Care Act (ACA) makes available to certain middle and lower-income individuals a refundable tax credit, the Premium Tax Credit (PTC), designed to help them pay the premiums on their qualified health care plans. To achieve Congress’s goal of making health insurance affordable, the PTC is most often provided directly to an individual’s insurance provider each month in advance of actually claiming the PTC on the individual’s year-end annual tax return. Of the almost twelve million individuals who have enrolled in health insurance through the federal and state health exchanges in 2015, 85% of these individuals …

Full Circle? The Single Tax Principle, Beps, And The New Us Model, Reuven S. Avi-Yonah

Articles

This paper will argue that while there is some innovation in BEPS, it is in fact more of a continuation that a sharp break with the past. Like Alexis de Tocqueville’s French Revolution, BEPS represents both continuity and change. In particular, the single tax principle has formed the theoretical basis of much of the international tax regime from the beginning. And it is in fact this continuity rather than any sharp change that gives the final BEPS package its promise to, as Secretary General Gurria also promised, “put an end to double non-taxation.”

Provisions Denying A Deduction For Illegal Expenses And Expenses Of An Illegal Business Should Be Repealed, Douglas A. Kahn, Howard Bromberg

Articles

Currently, the tax law denies a deduction for business expenses that violate a federal or state law (but only if the state law is generally enforced). In addition, losses, including business losses, cannot be deducted if they arise out of an illegal activity. For example, medical expenses are denied a deduction if they are illegal. Kickbacks, bribes, and rebates given in connection with the Medicaid or Medicare program are nondeductible. Any expenses, legal or not, incurred in connection with the conduct of a business of selling a controlled substance that is prohibited by federal law (or by the law of …

When International Tax Agreements Fail At Home: A U.S. Example, Diane Ring

Brooklyn Journal of International Law

Over the past two and a half years, the international tax community has focused on the Base Erosion and Profit Shifting Project (BEPS project) undertaken by the Organisation for Economic Co-operation and Development (OECD) at the behest of the G20. According to the OECD, the resulting 2015 agreement involved the direct participation of more than sixty countries. An additional fifty-nine countries indirectly participated through regional dialogues. Furthermore, numerous international organizations are credited with participating in discussions and contributing to the resulting product. But, effective implementation of the BEPS agreement requires domestic action of various types—the domestic side of international agreement …

A Bipartisan Tax Reform?, Reuven S. Avi-Yonah

Articles

A Bipartisan Tax Reform?By Reuven S. Avi-YonahIf one listens to what Democratic and Republicancandidates for president are saying on the cam-paign trail, it would appear that the chances for taxreform in 2017 and beyond are minimal. A biparti-san approach is essential for tax reform to passbecause even if there are majorities from the presi-dent’s party in both houses, major tax reform wouldnot likely get through the Senate without 60 votes.But the parties seem very far apart on tax reform.Democrats are focused on using the tax system toreduce inequality and are determined to raise thetax rates at the top of the …

Back To 1913?: The Ryan Blueprint And Its Problems, Reuven S. Avi-Yonah

Articles

From the Revolutionary War to the late 19th century, the federal government was financed primarily through regressive tariffs on imported goods. The exception was the income tax enacted during the national emergency of the Civil War, which was allowed to expire in 1872. The rise of an industrial economy in the post- Civil War era led to significant increases in inequality, which the tariffs exacerbated by falling primarily on the working class. ‘‘Robber barons’’ like J.P. Morgan, Andrew Carnegie, and John D. Rockefeller did not consume most of their income, and their intangible wealth avoided state-level personal property taxes as …

Saving The Farm Or Giving Away The Farm: A Critical Analysis Of The Capital Gains Tax Preferences, Phyllis C. Taite

Faculty Articles

Over the years the topic of capital gain preferences has been thoroughly debated. Discussions range between whether the tax rates on capital gains should be raised, reduced, or repealed. Other discussions have centered on whether capital gains has an effect on the economy, and if so, how the research supports those assertions. It would be difficult to cover all aspects of the issues associated with capital gains taxes in one article; therefore this discussion will focus on capital gains as applied to individual income taxes. The capital gains tax has been criticized for the questionable effect it has on the …

The Impact Of The United States Tax Laws On International Technology Transfer: An Overview And Some Suggestion For Minimizing The Bite, Marcus B. Finnegan, Robert E. Mccarthy

Georgia Journal of International & Comparative Law

No abstract provided.

Of More Than Usual Interest: The Taxing Problem Of Debt Principal, Charlene D. Luke

Seattle University Law Review

Leverage is an essential but often troubling component of the U.S. market. The financial crisis highlighted the risks and complexity of a leverage web that includes flesh-and-blood people from all walks of life and paper people from all corners of the business and investment world. In the tax area, the potentially problematic incentive effects of interest deductibility have long engaged a wide array of tax commentators and policymakers. While interest deductibility rightly receives widespread scrutiny, a more comprehensive approach to leverage is needed. This Article focuses on the surprisingly complicated tax treatment of cash (and cash equivalent) borrowings. This Article …

Federal Tax Update, Stephen L. Owen

William & Mary Annual Tax Conference

No abstract provided.

With Marriage On The Decline And Cohabitation On The Rise, What About Marital Rights For Unmarried Partners?, Lawrence W. Waggoner

Law & Economics Working Papers

Part I of this paper uses recent government data to trace the decline of marriage and the rise of cohabitation in the United States. Between 2000 and 2010, the population grew by 9.71%, but the husband and wife households only grew by 3.7%, while the unmarried couple households grew by 41.4%. A counter-intuitive finding is that the early 21st century data show little correlation between the marriage rate and economic conditions. Because of the Supreme Court’s decision in Obergefell v. Hodges (2015), same-sex marriage is now universally available to same-sex couples. Part I considers the impact of same-sex marriage on …

Becker V. Becker, 131 Nev. Adv. Op. 85 (Oct. 29, 2015), Paul George

Nevada Supreme Court Summaries

In response to a certified question by the United States Bankruptcy Court for the District of Nevada, the Court concluded that under NRS 21.090(1)(bb) a debtor can exempt his stock in the corporations described in NRS 78.746(2), but his economic interest in that stock is still subject to the charging order remedy in NRS 78.746(1).

Tax Incentives To Exportation: Alternatives To Disc, Timothy A. Peterson

Georgia Journal of International & Comparative Law

No abstract provided.

Through The Antiboycott Morass To An Export Priority, Mark D. Menefee, Don Samuel

Georgia Journal of International & Comparative Law

No abstract provided.

Dodging The Taxman: Why The Treasury’S Anti-Abuse Regulation Is Unconstitutional, Linda D. Jellum

University of Miami Law Review

To combat abusive tax shelters, the Department of the Treasury promulgated a general anti-abuse regulation applicable to all of subchapter K of the Internal Revenue Code of 1986. The Treasury targeted subchapter K because unique aspects of the partnership tax laws—including its aggregate-entity dichotomy—foster creative tax manipulation. In the anti-abuse regulation, the Treasury attempted to “codify” existing judicially-created anti-abuse doctrines, such as the business-purpose and economic-substance doctrines. Also, and more surprisingly, the Treasury directed those applying subchapter K to use a purposivist approach to interpretation and to reject textualism.

In this article, I demonstrate that the Treasury exceeded both its …

Silent Tax Changes: The Political Economy Of Indexing For Inflation, Alan L. Feld

Faculty Scholarship

The federal income tax adjusts many but not all of its dollar components automatically to account for inflation. In this article I analyze the benefits and burdens this process confers on some taxpayers and the political logic behind them. I discuss the choice of the proper index for making the adjustments, as well as the effects of the failure to adjust specific dollar amounts. I conclude that some adjustments have become overly generous, while unadjusted provisions suffer slow repeal, sometimes intentionally. Indexation thus can have the effect of tax legislation by stealth.

Income Tax Considerations In The Transition To A Professional Corporation, Harvey Dunn

Akron Law Review

[T]he tax considerations in the formation and operation of a professional corporation are numerous and, unfortunately, there are many areas which lack definite guidelines so as to enable the practitioner to give as definite an answer as he would like to. However, as with any new area of tax law, it will take time, decisions and rulings to develop what one may term as reasonable guidelines for reaching a conclusion. In the meantime, there is little doubt that with careful planning in the formative stages and close observation of the operation of a professional corporation, the risk of problems with …

Federal Income Tax Developments: 1975

Akron Law Review

FEDERAL INCOME TAX DEVELOPMENTS: 1975 is the third of an annual series of articles to be published in the Winter Issue of the Akron LAW REVIEW. The thrust of this article is not only to identify the new developments, but also to trace these concepts through their formative stages. The area of concentration for this article includes cases decided through September 30, 1975. Given the volatile nature of taxation, it is crucial for the practitioner in this field to remain current with the changes which have occurred during the tax year. The purpose of this article is to highlight for …

Federal Income Tax Developments: 1977

Akron Law Review

The thrust of this article is not only to identify the new developments, but also to trace these concepts through their formulative changes. This article covers the new developments in the case law including those cases and rulings implementing the Tax Reform Act of 1976.

Federal Income Tax Developments: 1978

Akron Law Review

FEDERAL INCOME TAX DEVELOPMENTS: 1978 is the sixth of an annual series of articles to be published in the AKRON LAW REVIEW. The scope of this survey is limited to the substantive developments in the field of income taxation. The thrust of this article is not only to identify new developments, but also to trace these concepts through their formulative changes.

Unreasonable Compensation In The Professional Corporation, Vincent J. Falcone

Akron Law Review

This comment will discuss the federal income tax issue of unreasonable compensation as it affects the incorporated professional. Discussion will first center on the modus operandi of the professional corporation, and how the compensation issue arises. Unreasonable compensation will then be defined and explained in that context. Next, the actual considerations used in determining whether compensation is excessive or not will be discussed. Then, the additional requirement that the remuneration be compensation in fact, and not a return on investment, will be investigated. The applicability of the 50% maximum tax on personal service income will also be analyzed. Finally, some …

Federal Income Tax Developments: 1979

Akron Law Review

The scope of this survey is limited to the substantive developments in the field of income taxation. The thrust of this article is not only to identify new developments, but also to trace these concepts through their formulative changes

Federal Income Tax Developments: 1980

Akron Law Review

The scope of this survey is limited to the substantive developments in the field of income taxation. The thrust of this article is not only to identify new developments, but also to trace these concepts through their formulative changes.