Tax Law Commons^™

Should Harvard And Other Large Nonprofits Be Taxed?, Reuven S. Avi-Yonah

Articles

In this installment of Reflections With Reuven Avi-Yonah, Avi-Yonah examines justifications for exempting Harvard University and other large nonprofits from tax and argues that treating those organizations like large C corporations would not be such a bad thing. The proposal to subject large university endowment investment income to the corporate tax rate of 21 percent instead of the current 1.4 percent rate has engendered significant debate. More recently, President Trump’s threat to strip Harvard University of its tax-exempt status and treat it as a taxable corporation has likewise been controversial. In their recent Tax Notes article, Harvey Dale, Daniel Hemel, …

Can Side By Side Work?, Reuven S. Avi-Yonah

Articles

On June 26 Treasury Secretary Scott Bessent announced that a compromise had been reached between the United States and the rest of the G7 (Canada, France, Germany, Italy, Japan, and the United Kingdom), providing that pillar 2 of the OECD’s two-pillar global tax reform project will not apply to U.S. multinationals. As a result, proposed section 899, which would have imposed retaliatory taxation on corporations from countries that apply pillar 2 (and specifically the undertaxed profits rule) to U.S.-based multinationals, was removed from the One Big Beautiful Bill Act.

The Irs Approach To Periodic Adjustments: Losing Bet Or Royal Flush?, Jeffery M. Kadet, Reuven S. Avi-Yonah, David G. Chamberlain, Stephen L. Curtis

Articles

In this article, the authors argue that GLAM 2025-001 is consistent with the terms and purposes of the commensurate with income provision, relevant legislative history, and applicable case law and that the IRS approach to commensurate with income enforcement is a valid application of discretion delegated by Congress to the Treasury under Loper Bright.

Should The United States Abandon Citizenship-Based Taxation?, Reuven S. Avi-Yonah

Articles

President Trump proposed during the election campaign to end the “doubletaxation” of American citizens living overseas.To which the answer is,what double taxation?Americans living overseas already benefit from three significant provisions thatin most cases prevent any double taxation, and because of these most of them donot have any U.S. tax liability.Those who do are typically wealthier, derive incomefrom investments or from high wages, and are not subject to foreign tax becausethey live in tax havens or in countries that do not tax rich immigrants on foreignsource income, and they do not have any income from their country of residence.

Periodic Adjustments And The Arm's Length Principle, Reuven S. Avi-Yonah

Articles

The Internal Revenue Service (IRS) recently issued AM 2025-001, whichrepresents a significant change in its interpretation of the periodic adjustment rules for transfers of intangibles within a multinational and forcost-sharing agreements.Arguably, this finally brings the IRS into compliancewith the “commensurate with income” language added to Code Sec. 482 in1986.

Moore Questions, Some Answers: Fixing The Personal Tax System Despite Constitutional Constraints, David Gamage, John R. Brooks, Edward J. Mccaffery

Faculty Publications

Moore v United States was expected to rule on the constitutional necessity of the tax-law realization requirement originating from Eisner v Macomber, a potential impediment to progressive tax reform efforts aimed at shutting down the planning techniques of Buy Borrow Die. The various opinions in Moore, however, provided no definitive answer to this core question, instead leaving many more questions. Amid the lingering uncertainty, we argue that various responses to the problem of wealthy Americans’ not needing to pay any taxes remain possible after Moore. An incremental, “mix-and-match” approach to progressive tax reform may best suit the …

Green Dividends: A Case Study In Green Dividends And The Conditions For Private Ordering Solutions, Anne M. Tucker

Seattle University Law Review

This Essay introduces a novel private ordering solution to facilitate corporate investments in pro-social and environmental initiatives: Green dividends. Green dividends are an optional increase in shareholder dividends that are returned to the company to be reinvested in environmental initiatives or kept by a shareholder.

Green dividends pose an alternative to the current gridlocked debate that corporations can’t, won’t, shouldn’t, and shouldn’t even try to act in pro-social or environmental ways. Turning the common refrains on their head converts each narrative into an element for a successful private ordering solution: authority, accountability, shareholder buy-in, and government- backed enforcement. With Green …

Does Climate Disclosure Work To Reduce Greenhouse Gas Emissions? Emerging Evidence Suggests Cautious Optimism, Cynthia A. Williams

Seattle University Law Review

Significant regulatory resources have been spent developing global, voluntary climate and sustainability disclosure standards, such as the TCFD, TNRD, and ISSB’s Sustainability and Climate Disclosure standards, or domestically required disclosures, such as in the EU and in the U.S. Thus, it is important to evaluate whether this disclosure, particularly voluntary, qualitative disclosure, will have the power to shift the allocation of capital, will have a significant effect on the management of climate risk within firms, and ultimately will reduce climate change risk and biodiversity loss.

In this Article, several interrelated questions will be discussed. First, what does the empirical evidence …

Virtual Currency As Real Currency, Jeffrey A. Maine

Faculty Publications

Convertible virtual currency is increasingly equated with the notion of real currency. Indeed, the increased acceptance of virtual currency as a payment method among retailers and consumers, the evolution of new types of virtual currency that alleviate price volatility, and the recent expansion of foreign country initiatives confirm the strong trajectory toward virtual currency’s function as a transactional currency. Yet, the tax system continues to classify all forms of virtual currency as “property,” and not “currency,” which results in immediate taxation every time someone buys something with virtual currency. This Article argues that the adopted tax treatment of virtual currency …

In (Tax) Hindsight: When Should The Tax System Ease Taxpayer Regrets?, Charlene Luke

UF Law Faculty Publications

A brief review of, Emily Cauble, Taxpayers’ Tax Election Regrets, 77 The Tax Law. 77 (2023), that focuses on § 754 elections.

Taxing People, Not Residents, Yariv Brauner

UF Law Faculty Publications

Essentially all states tax their residents’ worldwide income. This norm is difficult to justify beyond vague notions of state provided benefits enjoyed by residents. Recent increased mobility (particularly tax-motivated mobility of wealthy individuals) and the growing importance of remote work and digital nomadism present a serious challenge to this linking of residence and taxing rights. This article examines whether exclusive source taxation of individuals could replace the existing rules which are based on a compromise between residence and source taxation. The article concludes that exclusive source taxation of individuals is both feasible and desirable, mainly due to its fairness and …

Taxing Torts Today And Tomorrow, Steven J. Willis

UF Law Faculty Publications

This article shows how tax law has long subsidized tortfeasors, often to the detriment of victims. Changes in the 1980s reduced the tortfeasor subsidy but did not eliminate it. The article shows how various changes which purported to help victims have, in practical terms, helped tortfeasors.

The article first covers the pre-1985 tax history of making torts profitable. The resulting financial incentives triggered multiple legal changes, which the article outlines prior to covering them in depth. The statutory issues involve Internal Revenue Code sections 104 (allowing victims to exclude personal physical injury payments from income); 130 (purporting to facilitate structured …

The Service’S Overgenerous Tax Treatment Of Crowdfunding, Jeffrey H. Kahn

Cardozo Law Review de•novo

The Internal Revenue Service released a fact sheet that defines crowdfunding as a method to raise money on websites by soliciting contributions from a large number of people. This article considers how crowdfunding is treated for tax purposes and argues that, contrary to the fact sheet's determination, all donations collected by commercial websites should be income to the recipient.

Foreword: Moore, Loper Bright, Corner Post, And The Future Of The Federal Tax System, David Hasen

UF Law Faculty Publications

In the 2023 Term, the Supreme Court decided three cases that are likely to have significant implications for the federal tax system. Moore v. United States presages a resuscitated constitutional realization requirement for the income tax—a requirement long thought moribund, if not dead, by most commentators and policymakers. Loper Bright Enterprises v. Raimondo jettisoned the Chevron doctrine’s deferential standard of review of agency rulemaking, returning the standard to some perhaps modified version of its more searching pre-Chevron status. And Corner Post, Inc. v. Board of Governors of the Federal Reserve System held that the statute of limitations for most …

Canadian Gaar And Statutory Interpretation, Jinyan Li, Joanne Magee

All Papers

The Canadian GAAR is an anti-abuse rule that denies the tax benefit resulted from abusive avoidance transactions. This paper examines the history, technical design, policy objectives and judicial interpretation of the GAAR. It explains the role of the new preamble and economic substance in applying the GAAR.

Clarifying The Constitutional Boundaries Of Income Taxation After Moore V. United States, Catherine Gluchowski

St. Thomas Law Review

Despite the significance of the term “income,” both the United States Supreme Court and the Internal Revenue Code do not provide an explicit definition of the term. This ambiguity causes the constitutionality of income taxation to remain a contested issue. Central to this ongoing debate is the issue of realization as a prerequisite for income taxation, exemplified by the case of Moore v. United States. In a landmark decision, the Ninth Circuit ruled that realization is not a constitutional requirement for Congress to impose a tax exempt from apportionment under the Sixteenth Amendment. This decision marked a pivotal departure from …

Allocative Justice As A Constraint On Fiscal Imperialism In International Tax, Okanga Ogbu Okanga, Kim Brooks

Articles, Book Chapters, & Popular Press

Taxpayers’ cross-border activities often result in two (or more) states claiming the right to tax their income. To address concerns about how those tax liabilities might aggregate and suppress international activities, states typically agree to split the tax base between them. But how can states fairly share tax revenue from cross-border activities? Tax scholars and policymakers offer different normative perspectives to address this inter-nation equity conundrum. In this article, we conceptualize these normative perspectives into two types. One centres on identifying where the economic factors that lead to the ability to produce the income are located (and uses that determination …

Tax Treaty Arbitration: An Unacceptable Surrender Of National Sovereignty Or An Expression Of Sovereign Power?, Kim Brooks, Richard Krever

Articles, Book Chapters, & Popular Press

The release in 2016 by the Organisation for Economic Co-operation and Development of a draft multilateral treaty to modify thousands of global bilateral tax treaties was met with surprisingly strong support by the international community, with many states signing, ratifying, and implementing the treaty. One of the treaty’s most contentious elements is the addition to the dispute resolution measures in bilateral treaties, a process known as mutual agreement procedure, of a mandatory arbitration procedure that is to be available where agreement cannot be reached under the conventional process. In contrast to the mutual agreement procedure, which includes no requirement that …

Are We Trapped By Realization?, Reuven S. Avi-Yonah

Articles

In this installment of Reflections With Reuven Avi-Yonah, Avi-Yonah examines the downsides of the realization requirement and potential solutions to them. In an excellent Tax Notes article, Steven Sheffrin recently mounted the most convincing defense of the realization requirement I have read. He explained that the case for taxing unrealized capital gains is based on the Haig- Simons definition of income. In this definition, income equals consumption plus savings when savings includes both realized and unrealized capital gains. If asset prices change because of changes in future cash flows, Haig-Simons income can provide an appropriate guide for designing tax policies.

Fiscal Citizenship And Taxpayer Privacy, Alex Zhang

Faculty Articles

Should individual tax data be public or confidential? Within the United States, secrecy has been the rule since the Tax Reform Act of 1976. But at three critical junctures—the Civil War, the 1920s, and the 1930s—Congress made individual tax records open for public inspection, and newspapers published the incomes of the billionaires of the time. Today, Finland, Norway, and Sweden all mandate significant transparency for individual tax information.

This Essay intervenes in the tax-confidentiality debate by building a new analytical framework of fiscal citizenship. Until now, scholars have focused on compliance—whether disclosure incentivizes honest reporting of income, and if it …