Hard Law & Soft Law in International Taxation

Allison Christians
Why do countries follow the rules they do for international taxation? Are they legally obligated, obligated by something that is not law but is similarly compelling, or not obligated at all? Discussion in international tax literature is increasingly using terms such as hard law, customary law, and soft law in an effort to answer these questions and suggest policy approaches.[1] For example, tax scholars have argued...

The Section 734(b) Basis Adjustment Needs Repair

Howard Abrams
The partnership tax provisions – Subchapter K of the Internal Revenue Code – work pretty well. And they have a difficult job to do because they must provide a reasonable mechanism for taxing arrangements between parties that can be far from off-the-rack. It should not be difficult to figure out how to tax two individuals who contribute equal amounts of cash to start a joint business in which each will own a one-half...

An Analysis of Budget Offset Requirements for Tax Expenditures

Dhammika Dharmapala
Abstract Budget rules enacted by Congress in the 1990’s (and currently still in force) established pay-as- you-go (PAYGO) rules requiring that the revenue loss from any new or expanded tax expenditure provision be offset in the same fiscal year by legislation raising an equivalent amount of extra revenue. This note extends Dharmapala’s (1999) model of the political economy of tax expenditures to incorporate the...

Three Essays on Tax Salience: Market Salience and Political Salience

David Gamage
Written by: David Gamage and Darien Shanske Should the U.S. introduce a value added tax? How should we manage budget deficits? Should we abolish the alternative minimum tax? Why does the U.S. conduct most of its social- welfare policy through tax expenditures? Should we automate and simplify income-tax filing?  Tax salience is the key to these and other important debates. The behavioral economics revolution has...

Fixing the Constitutional Absurdity of the Apportionment of Direct Tax

Calvin Johnson
Fixing the Constitutional Absurdity of the Apportionment of Direct Tax argues that the Constitutional requirement that "direct tax" be apportioned among the states according to population should never be used to make any federal tax impossible. "Direct tax" is a word like "trash" defined by what you are going to do with it, and "direct tax" originally meant "apportionable tax." Before the Constitution, "direct tax" included...

Tax Opinions in TIC Offerings and Reverse TIC Exchanges

Bradley T. Borden
Co-author: Todd D. Keator[*] TABLE OF CONTENTS I.INTRODUCTION II.DEVIATIONS FROM THE REVENUE PROCEDURE A.Common Deviations 1.Deemed Consent 3.Investor Loans 4.Sponsor Guarantees 5.Sponsor Bridge Loans B.Significant Deviations 1.Multiple Properties 2.Non-Pro Rata Debt 3.Construction Activities 4.Sponsor-Retained Interests III.REVERSE EXCHANGES INVOLVING TIC INTERESTs A.Securities Issues B.Contractual...

Use And Enjoyment Of Intangible Services: The Czech Republic’s VAT Derogation

Richard Ainsworth
On January 1, 2009 a minor change in the Czech Republic VAT[1] became effective. A use and enjoyment standard was added to modify the sourcing of certain service transactions.[2] Traditional proxy-based rules, derived from Articles 43 and 56(1) of the Recast VAT Directive (RVD),[3] are set aside by this modification when the customer receiving the services has a permanent establishment (PE) in the Czech Republic. The...

Offers in compromise after TIPRA

Burton J. Haynes
After the Bankruptcy Abuse Prevention and Consumer Protection Act you thought it couldn't get any worse for your tax delinquent clients? Wrong again. The latest Congressional gift to the IRS Collection Division is Section 509 of the Tax Increase Prevention and Reconciliation Act of 2005 (TIPRA). One must at least give grudging credit to the Congress for creative captioning, even though the substance of the law has little...

Timber!

Calvin Johnson
Under current law the combination of tax preferences for timber means that timber investments are subject to less than zero tax. Tax accounting should describe the economic income from timber. This proposal would treat timber as an ordinary asset, require the capitalization of all costs incurred before harvest, and allow the capitalized costs to be recovered only under cost depletion. It would also tax and capitalize...

Between a Rock and a Hard Place

Bryan T. Camp
Today's column discusses the Tax Court's jurisdiction to hear stand-alone petitions from taxpayers who have been denied equitable relief under section 6015(f), one of the three spousal relief provisions contained in section 6015. Congress enacted section 6015 in the Internal Revenue Service Restructuring and Reform Act of 1998 (RRA 98) to replace the old “innocent spouse'' provisions in section 6013(e).[1] My prior...
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