Taxation-Federal Commons^™

Fatca: Toward A Multilateral Automatic Information Reporting Regime, Joanna Heiberg

Washington and Lee Law Review

No abstract provided.

Wandering Far Afield With Defined Value Clauses, Wendy G. Gerzog

All Faculty Scholarship

The Wandry decision extends the application of defined value clauses beyond those family limited partnership cases that transfer any excess value to a charity. In Wandry, the Tax Court reads Procter narrowly and ignores the fundamental rationale of Robinette.

Vive La Petite Difference: Camp, Obama, And Territoriality Reconsidered, Reuven S. Avi-Yonah

Articles

The recent tax reform proposals by House Ways and Means Committee Chair David Camp, R-Mich., and by President Obama seem to offer starkly contrasting visions of how to reform the taxation of foreign-source income earned by U.S.-based multinational enterprises.1 Both acknowledge the problem, which is that U.S.-based MNEs currently have more than $1 trillion of ‘‘permanently reinvested’’ income offshore, which they cannot bring back to the U.S. without incurring a 35 percent tax penalty. However, they seem to offer radically different solutions: Under the Camp proposal, a participation exemption will enable U.S.-based MNEs to bring back the income without paying …

Real-Time Solution To Refund Fraud: Vat Lessons From Belgium, Brazil, And Quebec, Richard Thompson Ainsworth

Faculty Scholarship

This article provides support for a proposal to eliminate refund fraud in the U.S. by turning Forms W-2, and 1099 into self-certified/ self-authenticated tax documents. The proposal suggests that a “digital signature” of these documents should be taken after they are completed. The signature should then be made part of the final document.

This proposal was initially advanced in Refund Fraud? Real-Time Solution! The underlying premise of that article was that the US could dramatically reduce, if not eliminate, refund fraud if it borrowing digital security techniques from the VAT. The article did not however, explain or expand upon these …

Examining The Tax Advantage Of Founders' Stock, Gregg D. Polsky, Brant J. Hellwig

Scholarly Articles

Recent commentary has described founders' stock as tax-advantaged because it converts founders' compensation income into capital gains. In this paper we describe various founders' stock strategies that offer this character conversion and then analyze whether they are, on the whole, tax advantageous. While the founders' stock strategies favorably convert the character of the founders' income, they simultaneously turn the company's compensation deductions into non-deductions. Whether founders' stock is tax-advantaged overall depends on whether the benefit of the founders' character conversion outweighs the cost of the company's lost deductions. We use various hypothetical to illustrate this tradeoff. We conclude that founders' …

Tax Reform And Incentives For Innovation, Annette Nellen

The Contemporary Tax Journal

No abstract provided.

Increase In Standard Mileage Rate For Certain Charitable Work

The Contemporary Tax Journal

No abstract provided.

Election By Certain Individuals To Have Their Income Tax Return Prepared By The Irs

The Contemporary Tax Journal

No abstract provided.

The Contemporary Tax Journal Volume 2, No. 1 – Spring 2012

The Contemporary Tax Journal

No abstract provided.

New Reporting Requirements For Foreign Financial Assets, Christopher Rossi

The Contemporary Tax Journal

No abstract provided.

Can Employees Deduct Meals And Gifts For Co-Workers?, Ke Huang

The Contemporary Tax Journal

No abstract provided.

Irs Still Battling “Abusive Tax Shelters” 25 Years Later, Lindsay Wilkinson,

The Contemporary Tax Journal

No abstract provided.

Fitness Tax Credits: Costs, Benefits, And Viability, Daniel M. Reach

Northwestern Journal of Law & Social Policy

As the number of overweight and obese Americans rises, it becomes increasingly clear that Americans need further incentives to stimulate lasting lifestyle changes. Tax incentives focused on exercise, which have been largely unexplored to this point, are an effective response to the growing obesity problem in the United States that would largely avoid the political opposition that tax policies focused on diet have encountered. In addition, they would also provide a more palatable solution for the taxpayer beneficiaries with a relatively low impact on government revenues. Viable tax incentives to encourage greater fitness include tax credits and sales tax breaks, …

The Great American Tax Novel, Lawrence Zelenak

Michigan Law Review

David Foster Wallace-author of the celebrated novel Infinite Jest and among the most acclaimed American fiction writers of his generation-killed himself in 2008 at the age of forty-six. He left in his office hundreds of pages of The Pale King, an unfinished novel set in the fictional Peoria, Illinois regional examination center ("REC") of the Internal Revenue Service ("IRS" or "the Service") in 1985. Although many chapters of the novel were seemingly complete, Wallace left no indication (other than what could be gleaned from the chapters themselves) of the order of the chapters (pp. vi-vii). Michael Pietsch, who had served …

The U.S. Tax System: Where Do We Go From Here?, Adele C. Morris

Brookings Scholar Lecture Series

This talk will explore how the U.S. tax system really works, where revenue comes from, where spending goes, what a tax expenditure is, and discuss deficit prognoses and how the recent political debates could affect our economy. The speaker will highlight some advantages and disadvantages of different budget balancing options.

Obamacare And The 'What Is A Tax?' Issue – Part Ii, Steve R. Johnson

Scholarly Publications

We are engaged in a two-part exploration. The previous installment of our column reviewed the perennial question of whether a given state or local exaction should be classified as a tax or something else. It rehearsed the contexts in which the issue has arisen in state and local tax controversies, the practical stakes involved in those controversies, and the criteria courts have developed to distinguish between truces and other types of governmental levies.

The previous installment also said that a new source of guidance as to the “what constitutes a tax?” question is developing: litigation over the individual mandate and …

Defined Value Clauses And Fair Market Value, Wendy G. Gerzog

All Faculty Scholarship

In Hendrix the Tax Court considered the issues of whether defined value clauses were the result of arm’s-length transactions and whether they were void as against public policy. The underlying dispute was whether the taxpayers’ transfers of the John H. Hendrix Co. stock were valued at fair market value. With a decision favoring the taxpayers, the defined value clauses in both McCord and Hendrix impede the accurate valuation of taxable gifts to family members and of deductible charitable gifts.

The Taxman On Campus: How Aggressive Irs Initiatives Are Increasing Audit And Compliance Risk For Colleges And Universities, William A. Bailey

Brigham Young University Education and Law Journal

No abstract provided.

Surrogate Taxation And The Second-Best Answer To The In-Kind Benefit Valuation Riddle, Jay A. Soled

BYU Law Review

For well over a century, theorists have debated how the receipt of inkind benefits, such as meals and lodging furnished for the convenience of an employer and business entertainment opportunities, should be taxed. While debate participants have generally agreed that the receipt of such in-kind benefits constitutes income, the question has remained about whether to value such benefits at fair market value or at the recipient’s subjective value or to use some other metric. Because of administrative considerations in determining the tax base, the Internal Revenue Code (Code) historically used a binary approach: either include the in-kind benefit at its …

Refund Fraud? Real-Time Solution!, Richard Thompson Ainsworth

Faculty Scholarship

When seven million dependents vanished from the tax rolls in 1986 the IRS recovered three billion dollars in revenue. A simple enforcement measure was applied. Taxpayers were required to list the social security number (SSN) for any dependent they claimed on their tax return. Costing next to nothing to implement, the benefits of this enforcement action continue to this day.

A similar enforcement measure could be employed against refund fraud. Even though the solution is not as simple as that adopted in 1986, it is similar. The effort is worth making. The revenue loss is much larger. As before, the …

Boomer-Ang Eldercare: Deductible Claim?, Wendy G. Gerzog

All Faculty Scholarship

In this article, Gerzog discusses Estate of Olivo, in which the Tax Court determined the deductibility under section 2053 of a claim against the decedent’s estate for eldercare services provided by a family member.

Obamacare And The 'What Is A Tax?' Issue – Part I, Steve R. Johnson

Scholarly Publications

One of the hardiest perennials in the garden of state and local tax issues is the question whether particular revenue measures should be classified as taxes or some other type of exaction. The issue has been dispositive in numerous state and local tax cases and, befitting that significance, has been the topic of many reports in this journal.

Given the frequency of the decisions and commentary, authorities cited on the issue constantly evolve. State courts, omnivorous in their search for precedents and rationales, often cite federal cases. Recognizing this, a recent article in State Tax Notes examined decisions of the …

Saving The Preachers: The Tax Code's Prohibition On Church Electioneering, Nicholas P. Cafardi

Duquesne Law Review

No abstract provided.

An Empirical Study Of Innocent Spouse Relief: Do Courts Implement Congress's Legislative Intent, Stephanie Mcmahon

Faculty Articles and Other Publications

Under existing law spouses are jointly and severally liable for their joint tax returns. As a result, the IRS may pursue either spouse for any taxes owed on those returns. Concerned that the IRS was seeking taxes from the “wrong” spouse under the joint and several liability regime, Congress expanded relief for “innocent” spouses in 1998. Many critics of this relief complain that, as it is applied, the statute offers too little relief to spouses, generally wives, who sign returns while being deceived or compelled by their mates. However, there has been no empirical study of whether the current relief …

The Injustice Of Ignorance, Nicholas Tavares

Common Reading Essay Contest Winners

Third Place (tie)

The Individual Mandate, Taxation, And The Constitution, Erik M. Jensen

Faculty Publications

This article examines the Supreme Court's 2012 decision in National Federation of Business v. Sibelius (NFIB). That case held that the individual mandate penalty in the Obamacare legislation will be a tax and not a penalty, and that the penalty will therefore be constitutional under the Taxing Clause of the Constitution, even though a majority of the Court held that the mandate itself-the requirement to acquire insurance or pay the tax/penalty-was not a valid exercise of the commerce power. The result in the case was not necessarily a surprise, but the reliance on the taxing power was. This article discusses …

The Conservation Easement Tax Expenditure: In Search Of Conservation Value, Roger Colinvaux

Scholarly Articles

Federal tax law has long provided a tax benefit for charitable contributions of easements for conservation purposes. A fundamental problem with this conservation easement tax expenditure is that the measure for the tax benefit – lost economic development value – is erroneous. Use of such an erroneous measure obscures the conservation benefits of the program by focusing attention and resources on divining a largely extraneous and unhelpful number. Further, to a considerable extent, the easement program is reflexively justified and understood based on this false measure, as if it represented the conservation value of the program. The Article argues that, …

Who Wins When Uncle Sam Loses? Social Insurance And The Forgiveness Of Tax Debts, Shu-Yi Oei

Faculty Scholarship

Small-scale tax collections decisions have large-scale distributive consequences. The central question addressed in this Article is whether a deliberate government decision to forgive or to not collect a tax owed can be justified, given the distributive consequences that may result. In brief, the government’s decision not to pursue full collection of a delinquent tax debt may give rise to two types of distributive outcomes: First, the benefits of non-collection may be captured by the forgiven taxpayer’s other creditors. Second, the costs of non-collection may be imposed upon compliant taxpayers and the public through higher taxes, decreased government provision of goods, …

The Sale Of Tax Credits Revisited: A Cca Consecrates (Most Of) Tempel,, Erik M. Jensen

Faculty Publications

In a 2011 decision, Tempel v. Commissioner, the Tax Court had held, among other things, that gain on sales of state income tax credits was capital gain. In a new Chief Counsel Advice, the IRS has accepted the result, and most of the analysis, of Tempel, and it has also provided guidance about the tax consequences to a purchaser of credits. This article analyzes the CCA, discusses the remaining disagreements between t e Service and the Tempel court, stresses that the CCA's conclusions are explicitly limited to nonrefundable credits, and considers the results to a purchaser.

Special Use Valuation Under The Internal Revenue Code: Does It Matter Now And Will It Matter In The Future?, Rusty Wade Rumley

Kentucky Journal of Equine, Agriculture, & Natural Resources Law

No abstract provided.