Tax Law Commons^™

Don't Forget The Standard Deduction, John R. Brooks

Georgetown Law Faculty Publications and Other Works

The presidential candidates this campaign season are a diverse group with a wide range of tax policy proposals, but they agree unanimously about one thing: the need to limit itemized deductions. Sadly, however, none of their proposals tackles how limits on itemized deductions would affect the other side of the equation—the standard deduction — which is also very much in need of reform.

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 …

Reducing The Rate Of Prison Recidivism In Florida By Providing State Corporate Income Tax Credits To Businesses As An Incentive For Employment Of Ex-Felons, Heidi A. Hillyer

Barry Law Review

No abstract provided.

Trade Credit And Taxes, Mihir A. Desai, C. Fritz Foley, James R. Hines Jr.

Articles

This paper analyzes the extent to which tax differences affect the use of trade credit. U.S.-owned affiliates in low-tax countries use trade credit to lend, whereas those in high-tax countries use trade credit to borrow: 10% lower local tax rates are associated with net trade credit positions that are 1.4% higher as a fraction of sales. The use of trade credit to get capital out of low-tax, low-return environments is also illustrated by the temporary repatriation tax holiday in 2005, which was used most intensively by affiliates with positive net trade credit positions.

Professor Elaine Gagliardi On The Magical Power Of Appointment: Allows Trustor To Achieve Targeted Tax Consequences And Flexibility Of Control, Elaine H. Gagliardi

Faculty Journal Articles & Other Writings

As children, and sometimes as adults, we wish for magical powers to order the world in the way we want. Estate planners can make that wish come true for some clients and beneficiaries with judicious use of powers of appointment. Powers of appointment are uniquely suited to achieving targeted planning goals and increasing trust flexibility. Planning techniques, old and new, including the oft used Crummey trust1 and the more recently developed array of acronym trusts designed to achieve specific tax consequences, such as the intentionally defective grantor trust (IDGT)2 and the Delaware incomplete non-grantor trust (DING)3 to name a few, …

The Missing Tax Benefit Of Donor-Advised Funds, John R. Brooks

Georgetown Law Faculty Publications and Other Works

The second largest charitable organization in the country in terms of annual money raised is not the Red Cross, the Salvation Army, or the YMCA— it’s Fidelity Investments. The sixth largest is Charles Schwab Corp. Vanguard Group Inc. is No. 10. Needless to say, Fidelity, Schwab, and Vanguard are not running hospitals or soup kitchens. Rather, they are the three largest sponsoring organizations of donor-advised funds (DAFs).

DAFs are accounts established by contributions from charitable donors to a sponsoring organization that pools and manages many different DAFs. The DAF then makes distributions to operating charities based on the advice of …

Beps - A Primer On Where It Came From And Where It’S Going, Jeffrey M. Kadet

Articles

Governments throughout the world have been losing many billions of dollars of tax revenues from “legal” tax avoidance conducted by many multinational groups (MNEs) through aggressive structuring of operations and transactions that often lack economic reality so as to earn profits that are subjected to zero or low-taxation. The success of this “legal” tax avoidance motivated the G-20 and the OECD to initiate the two-year Base Erosion and Profit Shifting (BEPS) project, which took place from 2013 to 2015.

This discussion of the BEPS project is intended to give the reader an understanding of the project’s origin, its objectives, and …

Front Matter (Letter From The Editor, Masthead, Etc.)

The Contemporary Tax Journal

No abstract provided.

Overtaxing The Working Family: Uncle Sam And The Childcare Squeeze, Shannon Weeks Mccormack

Michigan Law Review

Today, many working parents are caught in a “childcare squeeze”: while they require two incomes just to make ends meet, they end up spending a strikingly large percentage of their income on childcare so that they can work outside the home. Worse still, some parents find themselves “squeezed out” of the market entirely, unable to earn the additional income their families require because they cannot find jobs that pay enough to offset soaring childcare expenses. This Article argues that the tax laws have played an important role in aggravating these hardships. Currently, the Internal Revenue Code treats the childcare costs …

A Constructive U.S. Counter To Eu State Aid Cases, Itai Grinberg

Georgetown Law Faculty Publications and Other Works

U.S. Treasury officials and members of Congress from both parties have expressed concern that the European Commission’s current state aid investigations are disproportionately targeting U.S.-based multinational enterprises. At the same time, a Treasury official recently suggested in congressional testimony that there are limits to what Treasury can do beyond strongly expressing its concerns to the commission. In that testimony, Treasury’s representative hinted at two specific pressure points: whether the state aid investigations could undermine U.S. tax treaties with EU member states; and whether any assessments paid by the foreign subsidiaries of U.S. MNEs as a result of state aid investigations …

Codifying Castle Harbour, Karen C. Burke, Grayson M.P. Mccouch

UF Law Faculty Publications

In this article, Burke and McCouch discuss the 2015 statutory amendment, enacted as part of the last-minute budget deal, that revised and renumbered the family partnership provision of section 704(e)(1). They question whether the change will accomplish its stated purposes of clarifying existing law and raising $1.9 billion in revenue, and they conclude that the 2014 proposals by former House Ways and Means Committee Chair Dave Camp offer a politically expedient source of selective pay-fors for future government spending without actually raising taxes.

Taxing State-Owned Enterprises: Understanding A Basic Institution Of State Capitalism, Wei Cui

Osgoode Hall Law Journal

State-owned enterprises (“SOEs”) have become active investors in global markets in the last decade, challenging policymakers in Canada and other Organisation for Economic Co-operation and Development countries to confront the logic of “state capitalism.” This article develops a novel theory of the income taxation of SOEs. Many countries subject their SOEs to the income tax, but economists tend to dismiss SOE taxation as superfluous. A contrary, popular belief holds that SOE taxation is necessary to ensure fair competition. This article shows that both views are mistaken and explains SOE taxation in terms of the agency problem for dividend policy. Because …

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 …

The Target Method For Partnership Special Allocations And Why It Should Be Safe-Harbored, Daniel S. Goldberg

Faculty Scholarship

The Treasury Regulations’ concept of “substantial economic effect” is the holy grail of partnership special allocations. Special allocations that have substantial economic effect will come within a safe harbor in the regulations and have assurance that the allocations that are provided in the partnership agreement will be respected. In order for the allocations to come within the substantial economic effect safe harbor, the partnership must (1) maintain capital accounts in accordance with the Treasury Regulations’ standard; (2) provide for liquidation in accordance with capital accounts in all events; and (3) either (a) provide for a deficit restoration obligation (DRO) on …

The Constitutional Nature Of The United States Tax Court, Brant J. Hellwig

Scholarly Articles

Is the United States Tax Court part of the Executive Branch of government? One would expect that question would be capable of being definitively answered without considerable difficulty. And as recently expressed by the Court of Appeals for the District of Columbia Circuit, that indeed is the case. In the course of addressing a challenge to the President's ability to remove a judge of the Tax Court for cause on separation of powers grounds, the D.C. Circuit rejected the premise that the removal power implicates two branches of government: "the Tax Court exercises Executive authority as part of the Executive …

Joint Winners, Separate Losers: Proposals To Ease The Sting For Married Taxpayers Filing Separately, Michelle Lyon Drumbl

Scholarly Articles

A taxpayer who is “considered as married” according to the Internal Revenue Code’s definition must file either a joint income tax return or an individual return using the “married filing separately” filing status. Those married taxpayers who file a separate, rather than a joint, income tax return are denied valuable benefits and subjected to a host of other unfavorable limitations. Low-income taxpayers, in particular, are hurt by these limitations. Certain married taxpayers, including victims of domestic violence and abandoned spouses, may have no choice but to file using the married filing separately status. Low-income taxpayers are denied tremendous benefits, such …

The Future Of American Tax Administration: Conceptual Alternatives And Political Realities, Steve R. Johnson

Scholarly Publications

No abstract provided.

Art For Irs’ Sake: Hobby Loss Rules And Artistic Endeavors, Maria Pirrone, Deborah Kliener

Journal of International & Interdisciplinary Business Research (2014-2019)

In Crile v. Commissioner, T. C. Memo. 2014-202 (Oct. 2, 2014), the United States Tax Court recently ruled that a tenured art professor’s artistic endeavors constituted a “business” rather than a “hobby.” Internal Revenue Code Section 183 limits taxpayers’ deductions to the extent of income earned if the activity is not engaged in for profit, i.e. a hobby, rather than a business. In this presentation, we examine the nine factors considered by the court in distinguishing between businesses and hobbies and discuss how the facts and circumstances of the taxpayer in this case prompted the court to decide in her …

International Taxation In China : A Contextual Analysis, Jinyan Li

Books

Chinese tax law affects corporations engaged in cross-border transactions with China. It may also impact the development of the international tax regime as China is increasingly engaged in international tax reform efforts, such as the G20/OECD BEPS Project. Chinese tax law is thus important to taxpayers, tax professionals and policymakers worldwide. However, it is a challenge to find comprehensive information and insightful analysis of Chinese tax law in English. International Taxation in China: A Contextualized Analysis meets that challenge. This book deals with the Chinese international tax regime, focusing on the enterprise income tax and tax treaties. First, it covers …

Sales Suppression: The International Dimension, Richard Thompson Ainsworth

American University Law Review

No abstract provided.