bluuebunny/crossref_metadata_2025 huggingface dataset:
Recent Developments in Federal Income Taxation: The Year 2003
Authors: Shepard Ira , McMahon Martin
Published: May 2022

This recent developments outline discusses, and provides context to understand the significance of, the most important judicial decisions and administrative rulings and regulations promulgated by the Internal Revenue Service and Treasury Department during the most recent twelve months - and sometimes a little farther back in time if we find the item particularly humorous or outrageous. Most Treasury Regulations, however, are so complex that they cannot be discussed in detail and, anyway, only a devout masochist would read them all the way through; just the basic topic and fundamental principles are highlighted. Amendments to the Internal Revenue Code generally are not discussed except to the extent that (1) they are of major significance, (2) they have led to administrative rulings and regulations, (3) they have affected previously issued rulings and regulations otherwise covered by the outline, or (4) they provide Many the opportunity mock our elected representatives. The outline focuses primarily on topics of broad general interest [to the two of us, at least] - income tax accounting rules, determination of gross income, allowable deductions, treatment of capital gains and losses, corporate and partnership taxation, exempt organizations, and procedure and penalties. It deals summarily with qualified pension and profit sharing plans, and generally does not deal with international taxation or specialized industries, such as banking, insurance, and financial services. Please read this outline at your own risk; we take no responsibility for any misinformation in it, whether occasioned by our advancing ages or our increasing indifference as to whether we get any particular item right.
Guaranteed Payments Made In Kind By A Partnership
Authors: Kahn Douglas A. , Cuenin Faith
Published: May 2022

If a partnership makes a payment to a partner for services rendered in the latter's capacity as a partner or for the use of capital, to the extent that the payment is determined without regard to partnership income, it is characterized by the Internal Revenue Code as a "guaranteed payment" and is treated differently from other partnership distributions. In addition, if a partnership makes a payment in liquidation of a retiring or deceased partner's interest in the partnership, part of that payment may be characterized as a guaranteed payment by section 736(a)(2). We will discuss in Part VI of this article the circumstances when a liquidating payment is treated as a "guaranteed payment." While section 707(c) and 736(a) refer to a "payment," there is no reason that it must be made in cash, and the leading treatises on partnership taxation agree that guaranteed payments can be made in kind.As used in this article, a "liquidating" distribution or payment refers to a partnership distribution or payment made pursuant to the liquidation of a partner's interest in the partnership. All other partnership distributions or payments are sometimes referred to as "operating" distributions or payments.
Book Tax Conformity for Financial Instruments
Authors: Keinan Yoram
Published: May 2022

Since the introduction of the corporate income tax in the United States in 1909, both lawyers and accountants have discussed whether to allow corporate taxpayers to use income reported by corporations to their shareholders on their financial reports under Generally Accepted Accounting Principles (“GAAP”) as the basis for imposing corporate income tax. Similar discussions have taken place in other countries, particularly in Europe in recent years. As of today, several countries apply general book-tax conformity, while several others apply it only to financial instruments. In the United States, limited booktax conformity already exists, to some extent, in the tax law, under the clearreflection-of-income principle contained in section 446, and in other specific provisions. Commentators agree, however, that currently, a general book-tax  conformity regime for corporate tax is not feasible. In addition, courts often discuss the different roles of tax and accounting rules, generally concluding that tax does not have to follow books in all cases.
Sharing Bank Deposit Information With Other Countries: Should Tax Compliance or Privacy Claims Prevail?
Authors: Blum Cynthia
Published: May 2022

A proposed regulation issued as one of the final acts of the Clinton Administration would have required  U.S. banks to routinely file with the IRS reports identifying nonresident alien individuals receiving payments of interest and the amount of such interest. U.S. bank deposit interest paid to nonresident aliens is exempt from U.S. tax, and previously only payments to Canadians were required to be reported to the IRS. Intense opposition to this regulation was expressed by bankers and other organizations, such as the Center for Freedom and Prosperity, as well as by Governor Jeb Bush of Florida (where bank deposits are held by many residents of Latin America). This opposition led the Bush Administration to withdraw the proposed regulation but to replace it with a similar proposed regulation applicable only to residents of 16 countries (12 member countries of the European Union, as well as Canada, Australia, New Zealand, and Norway). While the new proposed regulation has also  attracted fierce opposition, the Bush Administration has continued to defend it (but has not yet finalized it).
Family Limited Partnerships: Discounts, Options, and Disappearing Value
Authors: Burke Karen C. , McCouch Grayson M.P.
Published: May 2022

Family partnerships have been become increasingly popular as a means of avoiding estate and gift taxes. As other estate freezing techniques have been closed off by statutory anti-abuse rules, estate planners have increasingly resorted to partnerships as a vehicle for transferring assets within a family at deeply discounted values. Discounts ranging from one third to over one half of the value of the underlying assets are routinely claimed, and often allowed, based on lack of marketability and lack of control, even where these disabilities have no lasting or ascertainable economic effect. Nevertheless, the use of family partnerships to suppress value for transfer tax purposes rests on shaky conceptual premises that deserve closer scrutiny.
Recent Developments in Federal Income Taxation: The Year 2004
Authors: Shepard Ira B. , McMahon, Jr. Martin J.
Published: May 2022

This current developments outline discusses, and provides context to understand the significance of, the most important judicial decisions and administrative rulings and regulations promulgated by the Internal Revenue Service and Treasury Department during the year 2004. Most Treasury Regulations, however, are so complex that they cannot be discussed in detail; only the basic topic and fundamental principles are highlighted. Amendments to the Internal Revenue Code generally are not discussed unless they are significant or have led to administrative rulings and regulations that are covered by the outline. The outline focuses primarily on topics of broad general interest: income tax accounting rules, determination of gross income, allowable deductions, treatment of capital gains and losses, corporate and partnership taxation, exempt organizations, and procedure and penalties. It deals summarily with qualified pension and profit sharing plans, but generally does not deal with international taxation or specialized industries, such as banking, insurance, and financial services.
The Good, the Bad, and the Ugly in Post-Drye Tax Lien Analysis
Authors: Johnson Steve R.
Published: May 2022

The general federal tax lien attaches to "all property and rights to property, whether real or personal" which belong to the delinquent taxpayer. In most cases in which the IRS takes enforced collection action based on its lien, there is little doubt that the property the IRS is pursuing constitutes "property [or] rights to property." The easiest cases, of course, are those in which the tax delinquent is the fee simple owner of realty or personalty. The IRS typically goes after such assets first because the tax lien obviously attaches to them and they are relatively easy to convert into cash to pay the liability. If such assets are unavailable or have been exhausted, the IRS may pursue items involving less than fee simple ownership. As it does so, the question may arise whether the items constitute property or property rights. The Supreme Court has repeatedly stressed that the language of section 6321 "is broad and reveals on its face that Congress meant to reach every interest in property a taxpayer might have.  Despite this expansive construction, controversies as to the reach of the general lien are perennial. Whether a given interest constitutes "property [or] rights to property" for section 6321 purposes has been litigated in hundreds of cases.The most challenging of these controversies involve one or more of three situations. First, the taxpayer's interest may not yet have ripened (and may never ripen) into full possession or control of the underlying property. A continuum exists from mere hope, to expectancy, to contingent interest, to present possessory interest. Second, the taxpayer's interest may be shared with others. It may be undivided not individual, joint not single, or fractional. Third, restrictions may exist, under the instrument governing the property or under state law, on the taxpayer's ability to use or dispose of the property or on the ability of the taxpayer's creditors to reach the property or the taxpayer's interest in it. The more the taxpayer's interest diverges from fee simple ownership, because of one or more of these situations, the more likely is an argument that the tax lien does not attach to the interest because it is not "property [or] rights to property."
Anatomy of a Disaster Under the Internal Revenue Code
Authors: Lipman Francine J.
Published: May 2022

It might have been the howl of whipping winds; or the crackle, snap, pop of sizzling cinders; or the stench of smoke that woke them into the nightmare of 3:00 a.m. on October 26, 2003. They awoke on Wildcat Canyon Road surrounded by their woods and the Cleveland National Forest engulfed in a firestorm. Lonnie and Lori Bellante and their teenage daughters, Melanie and Lindi, raced from their third-generation homestead to the family Ford to escape threatening flames. The heat, registering hundreds of degrees, melted the truck’s tires and set it ablaze. The family surrounded by hundreds of burning trees somehow found a small clearing. Huddled together, they buried their sweaty faces and burned bodies in the dirt and waited. For four incessant hours, the wildfire that consumed everything but their lives, raged around them. Finally, the Bellante family stumbled to their feet, shocked and exhausted they began to grasp the horror that surrounded them. Even though they lost everything, the Bellantes are reminded daily by the absence of eight neighbors how lucky they are to have survived this disaster.
Recent Developments in Federal Income Taxation: The Year 2005
Authors: Shepard Ira B.
Published: May 2022

This recent developments outline discusses, and provides context to understand the significance of, the most important judicial decisions and administrative rulings and regulations promulgated by the Internal Revenue Service and Treasury Department during the most recent twelve months — and sometimes a little farther back in time if we find the item particularly humorous or outrageous. Most Treasury Regulations, however, are so complex that they cannot be discussed in detail and, anyway, only a devout masochist would read them all the way through; just the basic topic and fundamental principles are highlighted. Amendments to the Internal Revenue Code generally are not discussed except to the extent that (1) they are of major significance, (2) they have led to administrative rulings and regulations, (3) they have affected previously issued rulings and regulations otherwise covered by the outline, or (4) they provide Marty the opportunity to mock our elected representatives. The outline focuses primarily on topics of broad general interest (to the two of us, at least) – income tax accounting rules, determination of gross income, allowable deductions, treatment of capital gains and losses, corporate and partnership taxation, exempt organizations, and procedure and penalties. It deals summarily with qualified pension and profit sharing plans, and generally does not deal with international taxation or specialized industries, such as banking, insurance, and financial services. Please read this outline at your own risk; we take no responsibility for any misinformation in it, whether occasioned by our advancing ages or our increasing indifference as to whether we get any particular item right. Any mistakes in this outline are Marty’s responsibility; any political bias or offensive language is Ira’s.
Is the Report of Lazarus's Death Premature? A Reply yo Cameron and Postlewaite
Authors: Kahn Douglas A.
Published: May 2022

Over a year ago, Ms. Faith Cuenin and I wrote an article in this Review (which I hereafter refer to as the “2004 Article”) about the tax treatment of guaranteed payments under section 707(c) that are made in kind. We concluded that a partnership does not recognize gain or loss on the making of a guaranteed payment with appreciated or depreciated property. We also concluded that the partner’s basis in the property received will equal its fair market value at the time of payment, and that the payment does not affect the partner’s outside basis in his partnership interest except to the extent of the partner’s share of any deduction that the partnership obtained by making the payment. Professors Cameron and Postlewaite strongly disagree with one of the conclusions we reached in our Article (i.e., our conclusion that the partnership does not recognize gain or loss) and with all of our reasoning. They are publishing in this issue of the Florida Tax Review (in what I will refer to as their “Lazarus Effect” Article) their analysis for rejecting our treatment of the topic. While I find their arguments well reasoned and documented, for reasons that I will explain in this response, I continue to hold to the conclusions that Ms. Cuenin and I reached in the 2004 Article. I will not reiterate in this response all of the analysis that is set forth in the 2004 Article, and I hope that an interested reader will turn to that piece. I will, however, respond to many of the points that are made in Cameron and Postlewaite’s Lazarus Effect Article.The Lazarus Effect Article can be divided into two principal parts. One is the contention that section 707(c) was impliedly or effectively repealed by the adoption of section 707(a)(2) as part of the Tax Reform Act of 1984.3 The second is a contention that, even if section 707(c) is still viable, the conclusion concerning the partnership’s nonrecognition of income that Ms. Cuenin and I reached in the 2004 Article, and our reasons for reaching that conclusion, are wrong. I will address both contentions.
Recent Developments in Federal Income Taxation: The Year 2006
Authors: Shepard Ira B. , McMahon, Jr. Martin J.
Published: May 2022

This recent developments outline discusses, and provides context to understand the significance of, the most important judicial decisions and administrative rulings and regulations promulgated by the Internal Revenue Service and Treasury Department during the most recent twelve months — and sometimes a little farther back in time if we find the item particularly humorous or outrageous. Most Treasury Regulations, however, are so complex that they cannot be discussed in detail and, anyway, only a devout masochist would read them all the way through; just the basic topic and fundamental principles are highlighted. Amendments to the Internal Revenue Code generally are not discussed except to the extent that (1) they are of major significance, (2) they have led to administrative rulings and regulations, (3) they have affected previously issued rulings and regulations otherwise covered by the outline, or (4) they provide Marty the opportunity to mock our elected representatives. The outline focuses primarily on topics of broad general interest (to the two of us, at least) – income tax accounting rules, determination of gross income, allowable deductions, treatment of capital gains and losses, corporate and partnership taxation, exempt organizations, and procedure and penalties. It deals summarily with qualified pension and profit sharing plans, and generally does not deal with international taxation or specialized industries, such as banking, insurance, and financial services. Please read this outline at your own risk; we take no responsibility for any misinformation in it, whether occasioned by our advancing ages or our increasing indifference as to whether we get any particular item right. Any mistakes in this outline are Marty’s responsibility; any political bias or offensive language is Ira’s.
The De-Gentrification of New Markets Tax Credits
Authors: Groves Roger M.
Published: May 2022

"I am concerned and I am frustrated because I don't know what the alternates are...It clearly isn't racist; its economics. The real question you have to ask yourself is: Is this good orbad?"-Norman Rice, former Mayor of Seattle, On gentrification in that cityUrban America is in a state of crisis. A huge pool of America's resources is increasingly disconnected from mainstream society. That pool is within the core of major cities and particularly includes African American and Hispanic male youth. By way of illustration, more than half of all core city African American men do not finish high school. The correlation between drop-out rates, unemployment, and incarceration is profound. As of 2004, 72% of African American dropouts who are in their 20's are unemployed, up from 65% in 2000.s Incarceration levels are at historic highs  and increasing, where by their mid-30's, 6 in 10 of these high school drop outs have spent time in prison. That rate is four times higher than that of Black men in South Africa under the apartheid regime. Seventy-five percent of African American males incarcerated in Baltimore Maryland did not graduate from high school. The infant mortality rate among all African Americans is more than twice the national average, and is much worse among the poor in the core of urban America. After the Katrina floodwatershave receded, some see an opportunity to buy low and sell high. But themuted voices of the poor cry to keep what they had.' For them it was aKatrina moment. For the urban core poor across the nation, it has been aKatrina erosion over the decades from a series of unnatural disasters.
Territorial vs. Worldwide International Tax Systems: Which is Better for the U.S.
Authors: McDaniel Paul R.
Published: May 2022

This article was presented at the 2006 Annual Symposium on International Taxation held at the University of Florida Levin College of Law Graduate Tax Program.The Report of the President’s Advisory Panel on Federal Tax Reform, entitled “Simple, Fair, and Pro-Growth: Proposals to Fix America’s Tax System,” was released in November 2005. One of the issues addressed in the Panel Report was whether the U.S. should shift from its current international tax system (taxing the worldwide income of its nationals with a credit for foreign income taxes) to a territorial system (exemption of foreign branch business income and dividends from foreign subsidiaries out of business income). The Panel opted for the territorial system. The report devoted only about twelve pages to the subject, but its recommendation has reignited interest in a subject which has recurred with some regularity over the past decade.
Common Markets, Common Tax Problems
Authors: Mason Ruth
Published: May 2022

It began with George Washington himself, when he wrote to Lafayette:I am a citizen of the greatest Republic of Mankind. I see the human race united like a huge family by brotherly ties. We have made a sowing of liberty which will, little by little, spring up across the whole world. One day, on the model of the United States of America, a United States of Europe will come into being. The United States will legislate for all its nationalities.The United States and the European Union are different in more ways than it is possible to briefly enumerate, but their foundations had a striking similarity of purpose: to increase citizens' welfare by uniting a collection of independent states, each with its own politics, culture, and economy. Of course, the unification of the U.S. states - never as divided politically, culturally, or economically as the countries of Europe- is an achievement largely in the past. In contrast, significant integration in Europe has taken place in our own time. Although the United States and the European Union have similar goals, the political structure and degree of unification differ substantially in each region. The United States is a single country, with a unified polity and a powerful central government, whereas the European Union is a collection of 27 independent countries and peoples with a weak central government. The purpose of this Essay is to explore the common tax problems confronting the U.S. and European Union (EU) common markets.
Recent Developments in Federal Income Taxation: The Year 2007
Authors: McMahon, Jr. Martin J. , Shepard Ira B. , Simmons Daniel L.
Published: May 2022

This recent developments outline discusses, and provides context to understand the significance of, the most important judicial decisions and administrative rulings and regulations promulgated by the Internal Revenue Service and Treasury Department during 2007 — and sometimes a little farther back in time if we find the item particularly humorous or outrageous. Most Treasury Regulations, however, are so complex that they cannot bediscussed in detail and, anyway, only a devout masochist would read them all the way through; just the basic topic and fundamental principles are highlighted. Amendments to the Internal Revenue Code generally are not discussed except to the extent that (1) they are of major significance, (2) they have led to administrative rulings and regulations, (3) they have affected previously issued rulings and regulations otherwise covered by the outline, or (4) they provide Dan and Marty the opportunity to mock our elected representatives. The outline focuses primarily on topics of broad general interest (to the three of us, at least) – income tax accounting rules, determination of gross income, allowable deductions, treatment of capital gains and losses, corporate and partnership taxation, exempt organizations, and procedure and penalties. It deals summarily with qualified pension and profit sharing plans, and generally does not deal with international taxation or specialized industries, such as banking, insurance, and financial services. Please read this outline at your own risk; we take no responsibility for any misinformation in it, whether occasioned by our advancing ages or our increasing indifference as to whether we get any particular item right. Any mistakes in this outline are Marty’s responsibility; any political bias or offensive language is Ira’s; and any useful information is Dan’s.
Recent Developments in Federal Income Taxation: The Year 2008
Authors: McMahon, Jr. Martin J. , Shepard Ira B. , Simmons Daniel L.
Published: May 2022

This recent developments outline discusses, and provides context to understand the significance of, the most important judicial decisions and administrative rulings and regulations promulgated by the Internal Revenue Service and Treasury Department during 2008 — and sometimes a little farther back in time if we find the item particularly humorous or outrageous. Most Treasury Regulations, however, are so complex that they cannot be discussed in detail and, anyway, only a devout masochist would read them all the way through; just the basic topic and fundamental principles are highlighted. Amendments to theInternal Revenue Code generally are not discussed except to the extent that (1) they are of major significance, (2) they have led to administrative rulings and regulations, (3) they have affected previously issued rulings and regulations otherwise covered by the outline, or (4) they provide Dan and Marty the opportunity to mock our elected representatives. The outline focuses primarily on topics of broad general interest (to the three of us, at least) – income tax accounting rules, determination of gross income, allowable deductions, treatment of capital gains and losses, corporate and partnership taxation, exempt organizations, and procedure and penalties. It deals summarily with qualified pension and profit sharing plans, and generally does not deal with international taxation or specialized industries, such as banking, insurance, and financial services. Please read this outline at your own risk; we take no responsibility for any misinformation in it, whether occasioned by our advancing ages or our increasing indifference as to whether we get any particular item right. Any mistakes in this outline are Marty’s responsibility; any political bias or offensive language is Ira’s; and any useful information is Dan’s.
Investment Income Withholding in the United States and Germany
Authors: Kahng Professor Lily
Published: May 2022

In a reversal from its historical roots, the United States income tax system now taxes income from labor significantly more heavily than income from capital. It does so not only facially, through explicit preferences for income from capital, but also more subtly, through more hidden features of the tax system - specifically, enforcement strategies. This Article focuses on a prominent disparity in enforcement between the two forms of income: Wage income is subject to withholding while investment income is not. In its critical examination of this disparity, the Article first offers a brief history of withholding in the United States, in which withholding on wage income was eagerly embraced as a part of a patriotic war effort, while withholding on investment income was rejected again and again. The Article then contrasts the United States experience with that of Germany. Under Germany's remarkably robust constitutional principle of equality in taxation, the failure to withhold on interest income was held unconstitutional, and the German legislature was required to enact it. However, instead of leading to greater equality in tax enforcement, the new withholding law led to widespread evasion. The German experience is cited as a cautionary tale on the dangers of international tax competition. Yet, ultimately, it may prove to have been the tipping point for countries to engage in the cooperative behavior needed to overcome undesirable tax competition. The last Part of the Article draws upon lessons learned from past U.S. and German experiences to make the normative and practical case that now is the time to adopt investment income withholding in the United States.
Just Enough: Substantial Performance, Ministerial Acts, and the All Events Tests for Income and Expense Accruals
Authors: Walberg Glenn
Published: May 2022

The tax law sets unrealistic expectations for accruing many income and expense items arising out of bilateral contracts. Under an accrual method, a taxpayer generally takes an income item into account when the taxpayer has a fixed right to receive it and takes an expense item into account when the taxpayer has a fixed liability to pay it. The tax law thus expects the taxpayer to determine when all events have occurred to make the right or liability unconditional. The taxpayer might find this determination easy if it were to exchange only one promise for one promise (e.g., seller only promises to perform services and buyer only promises to pay), use words establishing conditional relationships (e.g., the buyer promises to pay if and only if the seller performs the services), and experience nothing short of complete performance (e.g., the seller never provides nonconforming services). But the taxpayer probably doesn’t engage in those transactions very often.For most transactions, the taxpayer will find it difficult to determine whether all events have occurred to fix rights and liabilities from bilateral contracts. For example, consider a contract that contains a typical explicit requirement that a service provider submit an invoice to a client to receive payment for rendered services. Once the services have been performed, the accrual method rules contemplate that the parties will determine whether the submission of the invoice represents an event that must occur to fix the service provider’s right to income and the client’s liability to pay under the contract. That determination might prove difficult because some authorities and guidance have disregarded requirements to submit documentation whereas others have treated the satisfaction of such requirements as a prerequisite to any finding of fixed rights and liabilities. Aside from raising questions about how to reconcile the authorities and guidance, the differences in treatment highlight a larger issue that tax accounting rules occasionally require, but do not always permit—accruals prior to the full performance of all promises contained in bilateral contracts. As a consequence, taxpayers need to consider whether the occurrence of substantial performance, rather than full performance, represents the last event that must occur to fix rights and liabilities for tax purposes.
Jumping the Shark: The Case for Repealing the TEFRA Partnership Audit Rules
Authors: Prescott Peter A.
Published: May 2022

By their very nature, partnerships present problems for the U.S. tax system. Are they separate entities or just aggregates of their partners? It depends on the situation. Prior to 1982, the Internal Revenue Service had little choice but to audit the tax consequences of partnership activities by auditing each partner. Congress flipped that aggregate treatment on its head by enacting entity-focused partnership audit rules in the Tax Equity and Fiscal Responsibility Act of 1982. It's time to flip them back.Neither the practical problems that drove creation of the entity-focused partnership audit rules nor the tax policy rationales used to justify them retain strength today. Indeed, almost thirty years of experience with those rules has unearthed numerous negative consequences. Furthermore, improvements in the substantive law applicable to partnerships and in the technology available to the Internal Revenue Service for use in auditing partnerships have significantly reduced the benefits derived from the current partnership audit rules. In short, their costs now outweigh their benefits and they should be repealed.
Trading One Danger for Another: Creating U.S. Tax Residency while Fleeing Violence at Home
Authors: Hoose Mark S.
Published: May 2022

Recent levels of violence in Mexico have caused certain of its citizens who do not hold permanent U.S. residency status (and who may not intend to reside in the United States permanently) to spend more time in the United States. By doing so, these individuals create the risk that they will become U.S. residents for U.S. tax purposes, thereby subjecting their income to worldwide taxation by the United States (as well as creating potential U.S. estate and gift tax issues). This paper explores whether there is relief available to such individuals under U.S. domestic law (the “substantial presence” test and its various exceptions). It also explores whether Mexican nationals can obtain relief from U.S. residency under the terms of the United States-Mexico income tax treaty. The paper concludes that it is less than clear whether relief is available; in particular, it is not clear whether the tax authorities or the courts may consider violence in the person’s home country in determining whether the individual is a U.S. tax resident. The paper then goes on to propose various statutory changes to the law to allow the tax authorities to provide relief and certainty on the question of U.S. tax residency to individuals who are present in the United States merely to avoid violence at home. The paper argues for such relief on the basis that imposing worldwide U.S. taxation and tax reporting obligations on Mexican nationals present in the United States merely to avoid danger at home is inequitable given the contributions of U.S. policy to the violence in Mexico.
Tax Lawyers, Tax Defiance, and the Ethics of Casual Conversation
Authors: Hatfield Michael
Published: May 2022

Each profession entails a risk for a different kind of casual conversation its members must endure. Medical doctors probably endure casual conversations about pains and rashes, second guesses of primary care physicians, and disorganized thoughts about health care reform, prescription drugs, vitamin C, and chelation. Pastors, priests, and rabbis probably endure unbridled enthusiasm for ecumenical dialogue and experience. Lawyers listen to horror stories of divorce and custody battles, disorganized thoughts on tort reform, and, of course, lawyer jokes, most of which are not new, few of which are funny, and none of which are clever. Specialists within each profession suffer with specific conversations. The psychiatrist and the dermatologist risk different conversations, as do the tax lawyer and the criminal defense lawyer. The conversational risks of tax lawyers are fairly predictable. First are those conversations premised on confusing us with accountants, usually beginning with an inquiry as to our annual April 15th-related workload. Second are political conversations, usually about tax rates—especially those on capital gains, corporations, and estates. Some while back, the conversation was likely to begin with the wonders of the so-called flat tax, and no doubt the flat tax proposals will circle back again in our casual conversations. (Recently a medical doctor engaged me on the wonders of the flat tax, and given his conversation ensued during a medical procedure, I found myself more enamored with the proposal than ever before.) Perhaps the most common political tax topic at the moment is the income tax burden borne at the top and the income tax ease enjoyed on the bottom. The third common casual conversation topic for tax lawyers has to do with tax gimmicks and, especially, rumors of tax gimmicks. With this kind of conversation, tax lawyers are fairly skilled in conversational evasiveness, worrying about unintentionally forming an attorney-client relationship. Our fears related to this kind of conversant are not merely avoiding ethical issues or providing undeserved free legal advice but more so avoiding inviting him or her into a professional relationship. Clients interested in the latest tax gimmicks must be avoided, and those willing to chat-up strangers about tax advice are especially to be avoided.
The Corporate Income Tax: A Persistent Policy Challenge
Authors: Gravelle Jane G.
Published: May 2022

This article was presented as the inaugural Ellen Bellet Gelberg Tax Policy Lecture at the University of Florida Levin College of Law on November 12, 2010. The views in this study do not reflect the views of the Congressional Research Service.A newspaper article published in late October 2010 describes a scheme referred to as the “double Irish” with a “Dutch sandwich” that used a variety of rules to reduce taxes on the income of the search company Google to 2.4 percent. The method involved transferring the intangible asset developed by Google in the United States to an Irish holding company, with another, active, Irish subsidiary of that firm selling advertisements in Europe. The sales subsidiary paid royalties, eliminating its own Irish tax. The royalties were diverted through a subsidiary in the Netherlands to avoid the 20 percent Irish withholding tax on royalties. The Netherlands subsidiary then made payments to the Irish holding company whose tax residence was in Bermuda, with no tax. As a result, the income avoided both the 35 percent U.S. corporate tax and the 12.5 percent Irish corporate tax. Although not a company that is a household name, Forest Laboratories, a drug company, used a similar scheme but, in its case, exported pills made in Ireland back to the United States. Both articles described how many companies are using, or considering, such a plan.
In Defense of College Savings Plans: Using 529 Plans to Increase the Impact of Direct Federal Grants for Higher Education to Low- and Moderate-Income Students
Authors: Waldner Caroline
Published: May 2022

A high school graduate with no college education can expect to earn on average $638 per week. Those holding a bachelor’s degree earn almost twice as much at an average of $1,121 per week. This will amount to almost $1 million more in earnings over a lifetime. These abstract numbers, however, do not tell the entire story. Consider that at $638 a week, a person with only a high school diploma will earn on average $33,176 per year. This falls below the average annual family budget by almost $7,000 per year when including only necessities. In fact, this annual salary is lower than average family budgets in seven of the eight cities sampled.In addition to these individual monetary benefits, higher education also has significant non-monetary benefits as well. College graduates overwhelming report being happier and healthier than those who only attended high school, and most often reported being in “excellent” or “very good health.” This disparity increased with age — for those over the age of 65, 70 percent of college graduates identified themselves as being in good health compared to “only 45 [percent] of high school graduates.”
Tax Neutrality and Tax Amenities
Authors: Hasen David
Published: May 2022

Efforts to identify and implement an appropriate tax neutrality benchmark have been persistent themes in scholarly and policy debates on international taxation for fifty years. This paper questions whether the concept of tax neutrality has been adequately specified for analyzing the efficiency properties of international tax systems. As distinct from the closed-economy setting, in the open-economy setting, neither tax revenues received nor the burdens that tax revenues pay for may be taken as fixed. Because tax revenues finance infrastructure and other productivity-enhancing goods — so-called “tax amenities” — and because capital burdens infrastructure, the reallocation of tax revenues among jurisdictions and the movement of assets and productive capacities across borders cause the amount of tax revenue collected in each jurisdiction to diverge from the revenue target. A consequence is that what are viewed as tax incentive effects, or distortions, improve productivity in some cases. Neutrality as a value, however, rests on the idea that tax incentive effects reduce efficiency by causing resources to be allocated away from some optimum non-tax-affected baseline; this idea is what justifies referring to tax-influenced allocations as distortions. An implication is that the baseline is not well specified in the open-economy setting.This article suggests that, in light of these considerations and of the difficulty in implementing a theoretically satisfactory specification of neutrality, an analysis focusing on the allocative, distributive, and competitive properties of international tax rules would be more helpful than one focused on their neutrality properties. A simple model relating tax revenue and population to productivity is offered.
Relighting the Charitable Deduction: A Proposed Public Benefit Exception
Authors: Gutting Kristin Balding
Published: May 2022

"Let no man’s ghost say his training ever let him down."Throughout the country, firefighters risk their lives on a daily basis to keep the public safe. It is, therefore, imperative they receive the best possible training. One invaluable training method is live burn training, in which a structure is set on fire providing firefighters with “a level of realism that is unsurpassed.” Fire departments, both career and volunteer, as well as numerous municipal departments conduct various training exercises, including roof ventilation, domestic violence exercises, simulated meth lab explosions, room-to-room fire practice, firefighter survival techniques, arson investigation training, rescue techniques, and/or firefighter down techniques, through the donation of homes that are finally burned to the ground as part of live burn training.For over thirty-five years, relying on a United States Tax Court case, many believed a taxpayer could claim a charitable deduction for the donation of the taxpayer’s home to the local municipality for live burn training, while still retaining ownership of the underlying land (live burn donation). In 2004, however, the Internal Revenue Service (the Service) established a task force, charged with the sole purpose of extinguishing live burn donations, and requested that local municipalities not cooperate with taxpayers in executing the requisite paperwork in claiming a charitable deduction for a live burn donation. In 2009, the deductibility of a live burn donation was thrust into the public spotlight as the media publicized the Service’s attack on the charitable deduction claimed by Kirk Herbstreit, an ESPN commentator and former Ohio State quarterback, for the donation of his home to the local fire department. Soon after, in 2010, the live burn donation was back in the headlines as it was exposed that Oregon gubernatorial candidate, Chris Dudley, claimed a deduction on his 2004 federal income tax return for a live burn donation so he could build a new residence on the land. Consequently, in recent years, there has been much confusion and debate on whether live burn donations qualify for charitable deductions.
A New Paradigm for IRS Guidance: Ensuring Input and Enhancing Participation
Authors: Book Leslie
Published: May 2022

Cathy is a financially unsophisticated homemaker whose husband engaged in Medicare fraud in 1999, for which he was imprisoned the following year. Cathy had no involvement in the family's financial dealings, legal or otherwise, and was completely unaware of her husband's fraud. As aresult of the Medicare fraud, the couple owed an additional $900,000 in income taxes for the 1999 taxable year, which the IRS attempted to collect from Cathy and her husband in 2003. In the collections packet issued to Cathy, the IRS informed her of the availability of "innocent spouse" relief, whereby a spouse may be relieved from joint and several liability when thespouse meets certain requirements. Cathy, however, declined to elect innocent spouse relief because her incarcerated husband assured her that he would handle the matter. Cathy's husband died without having completed the necessary paperwork, and in 2006 the IRS resumed collection activities against Cathy. Cathy then claimed innocent spouse protection, but a Treasury regulation imposed a two-year deadline on such claims, and the IRS denied her relief.
Citizens United, Tax Policy, and Corporate Governance
Authors: Behrens Michael A.
Published: May 2022

These scenarios illustrate the ways in which the Citizens United decision might enable corporations to stage tax-motivated campaign interventions that benefit certain corporate stakeholders at the expense of others. The Court's holding that certain restrictions upon corporate political speech violate the First Amendment, while representing an incremental change to existing law, essentially removed limitations upon the exercise of political speech by corporations. The Court's decision drew immediate criticism from those concerned that corporate discourse would come to dominate the political process. Other observers were offended by the Supreme Court's basic premise in reaching its holding - that corporations,like individuals, possess free speech rights. It is this premise that gives rise to the subject of this paper, but in a slightly different context. After all, a key difference separates corporations and individuals. An individual speaks only for himself or herself when exercising the right to free speech. In contrast, a corporation is a legal construct that apportions power among shareholders, the board of directors,  and corporate managers in the process known as corporate governance. Thus, a corporate campaign intervention, inasmuch as it involves the corporation "speaking" with one voice, cannot help but involve corporate governance issues.
The U.S. and Chile Tax Treaty and Its Impact on Foreign Direct Investment
Authors: Hurtado Hugo
Published: May 2022

The tax treaty signed between Chile and the United States will reduce withholding rates applicable to interest, royalties, and capital gains and will exempt certain income derived from pension funds, services, and business profits not attributable to permanent establishments. This Article concludes that the exemption and reduction of withholding taxes may have a positive impact on Chilean foreign direct investment (“FDI”) in the United States since Chilean investors and pension funds will benefit from this exemption or reduction and from the fact that a broader type of investment income (interest, capital gains, and services) will be available for tax credits under the Chilean Income Tax Law. However, it is not altogether clear whether the loss of revenues from the reduction of taxes applied to income accrued by U.S. residents in Chile will be rewarded with greater FDI from the United States in Chile. This conclusion is mainly based on the fact that unless the U.S. investor has an excess tax credit position, such reduction will be offset by the higher U.S. corporate income tax on the income. Furthermore, the loss of revenues can be especially relevant for Chile as a result of applying the most favored nation clause included in several tax treaties signed with other Organisation for Economic Co-operation and Development (“OECD”) members.
Extinguishing and Amending the Tax-Deductible Conversation Easements: Protecting the Federal Investment after Carpenter, Simmons, and Kaufman
Authors: McLaughlin Nancy A.
Published: May 2022

The Internal Revenue Service‘s victory in Carpenter v. Commissioner represented an important step in the agency‘s ongoing efforts to both address abuses and establish precedent consistent with congressional intent in the conservation easement donation context. While Congress has clearly favored providing a charitable income tax deduction under Internal Revenue Code section 170(h) to encourage the donation of conservation easements, Congress also has been willing to do so only if the easements are "granted in perpetuity" to government and nonprofit holders "exclusively for conservation purposes" and the conservation purposes of such easements are "protected in perpetuity."