Tax Benefits of Government-Owned Marijuana Stores

By Benjamin Leff

I promise that I think about things other than marijuana, but if you’re following my posts on this blog so far, there is little evidence of that. In 2014, I published Tax Planning for Marijuana Dealers, which argued that sellers of marijuana could qualify as tax-exempt organizations under section 501(c)(4), which would enable them to avoid a draconian federal tax created by IRC section 280E. This article inspired a thoughtful response by fellow blogger Philip Hackney, in which Phil argued that such organizations cannot qualify for tax exemption. Among other things, he argued that that the so-called public policy doctrine applies to (c)(4) organizations just as much as it applies to (c)(3)s. We replayed some of our disagreement about the breadth of the public policy doctrine last month on this blog (here, here and here). But now I’ve posted a new draft article that addresses the application of the public policy doctrine to independent government entities that are exempt from federal income tax under IRC section 115 instead of 501(c). Continue reading “Tax Benefits of Government-Owned Marijuana Stores” →

Tax at Midlife

I am at the Association of Mid-Career Tax Professors (AMT) Annual Conference today and tomorrow, along with Surly co-bloggers Jennifer Bird-Pollan, Sam Brunson, and Stephanie Hoffer. The conference is hosted by Dennis Ventry and Darien Shanske at UC Davis. Sam, Stephanie, and I are on the organizing committee, along with Dennis and Brian Galle. The conference itself is, I think, Brian’s brainchild–thanks, Brian!

I’m presenting an early-stage piece called The Distributive Case against Offshore Tax Enforcement, which I hope to workshop more extensively over the fall and spring. Jennifer is presenting Taxes, Democracy, and Investment Treaties; Stephanie, Corporate Acquisitions and Integration; and Sam, Playthings of the Wealthy: RICs, Pease, and the AMT.

A question I keep asking myself is: What’s the mission of the AMT conference? Or more broadly, what should we be focusing on at this stage of our scholarly lives?

Back in the day when dinosaurs roamed the earth and I used to attend the still-extant Junior Tax Workshop, the goals were pretty clear: Continue reading “Tax at Midlife” →

Sugin: Rhetoric and Reality in the Tax Law of Charity

Linda Sugin (Fordham) has a new article out Rhetoric and Reality in the Tax Law of Charity, 84 Fordham L. Rev. 2607 (2016) that looks essential to anyone who is interested conceptually in the place of charity in state law and tax law. The abstract:

“The rhetoric of public purposes in charity law has created the mistaken impression that charity is public and fulfills public goals, when the reality is that charity is private and cannot be expected to solve the problems that governments can solve. The rhetoric arises from a combination of charity-law history and tax expenditure analysis. The reality follows the money and control of charitable organizations. On account of the mismatch of rhetoric and reality, the tax law of charity endorses an entitlement to pre-tax income and (ironically) creates a bias against taxation. This article reorients the project of defining public and private in the tax law by starting from a normative theory of government responsibility.

It challenges the conventional economic justifications for the charitable deduction and exemption, arguing for a more philosophical approach that makes affirmative demands on government to distribute the returns to social cooperation. Under this approach, the appropriate role of private organizations is residual; they must achieve what governments cannot. The article concludes by arguing that current law’s tax benefits for charity are easily justified in this new understanding.”

A Tax Professor Feels a Little at Sea

boaty — Credit: https://nameourship.nerc.ac.uk

Last Thursday, Tulane Law School held its annual faculty scholarly retreat, which basically means we cloistered ourselves in a downtown conference room and workshopped eight papers over the course of a day. ’twas a nice end-of-semester opportunity to appreciate and engage with everybody’s work. I got to be discussant on a paper by my colleague, Martin Davies, Cross-Border Insolvency and Admiralty: A Middle Path of Reciprocal Comity, a working version of which was recently published in the Comité Maritime International 2015 Yearbook. Martin is the Director of Tulane’s Maritime Law Center, and he has kindly given me permission to blog the paper here.

Warning: This blog post discusses areas of law that are only marginally related to tax law, which some may find unsettling. On the other hand, the paper implicates some interesting jurisdictional and distributional issues that parallel some of those found in international tax.

Continue reading “A Tax Professor Feels a Little at Sea” →

Rainy Saturday Tax Scholarship …

Irresponsibly Taxing Irresponsibility: The Individual Tax Penalty Under the Affordable Care Act

Georgetown Journal on Poverty Law & Policy, Vol. 23, No. 3, Spring 2016

In recent decades, Congress has used the federal income tax system increasingly to administer and deliver social benefits. This transition is consistent with the evolution of the American welfare system into workfare over the last several decades. As more and more social welfare benefits are conditioned upon work, family composition, and means-tested by income levels, the income tax system where this data is already systematically aggregated, authenticated, and processed has become the go-to administrative agency.

Continue reading “Rainy Saturday Tax Scholarship …” →

A New Wave of Income Share Agreements

By: Diane Ring

Just a few years ago, Income Share Agreements, or ISAs, were garnering popular attention. ISAs are arrangements in which an individual receives upfront funding from investors, perhaps for education or a start-up business, in exchange for agreeing to pay a percentage of his or her future income for a period of time. Well-known examples included Fantex (which involved a stake in the future earnings of a professional athlete), as well as Upstart, Pave, and Lumni (which generally involved funding for education or business ventures). Although the structures and terms varied, the feature these ISAs had in common was the absence of a guaranteed return of principal and the degree to which the investor was investing in the personal, financial success of the funding recipient – a relationship some criticized as owning a piece of the funding recipient.

Ultimately, though, the market did not show tremendous interest in these instruments. Upstart and Pave shifted to traditional loan models, and Lumni reportedly has issued fewer than 30 ISAs in the United States. Fantex has remained active, but Fantex was always a little different, because it actually involved an issuance of stock in a corporation whose value effectively tracked the earnings performance of a pro athlete. Additionally, the Fantex investment had a novelty dimension, appealing to sports enthusiasts.

Why, though, was the market not that interested in ISAs? There are a few likely reasons:

Continue reading “A New Wave of Income Share Agreements” →

Introduction Post: Leandra Lederman

Hi! I’m @Leandra2848, AKA Leandra Lederman, the William W. Oliver Professor of Tax Law at Indiana University Maurer School of Law in Bloomington. I have blogged occasionally before but never as a regular contributor—much less as a member of a Surly Subgroup—so this is a real privilege!

I’ve been a tax professor for 22 years, 12 of them at Maurer (minus last semester at U. Chicago). I teach Income Tax, Corporate Tax, Tax Procedure, and I run a Tax Policy Colloquium that brings 6 or 7 tax professors to Bloomington over the course of the spring semester. I’ve also taught a short course in Pamplona, Spain each of the last five years.

I write both on the individual and corporate federal income tax (including a 2016 edition of Understanding Corporate Taxation, co-authored with Michelle Kwon) and on tax procedure, which includes tax administration and tax litigation. Most recently, I wrote two articles about problems facing the IRS. Much of my work relates to tax compliance/ Continue reading “Introduction Post: Leandra Lederman” →

Hi, My Name Is Sam

Like those who have introduced themselves before me, I’m thrilled to be part of this tax-blogging experiment.

I’m Sam Brunson, and I teach a couple of tax classes (as well as Business Organizations) at Loyola University Chicago. My research interests are relatively catholic when it comes to tax law, but the primary strands of my research have been trending in two directions: the intersection of tax and religion and the taxation of investment stuff (most recently, focusing on mutual funds and other RICs). I also like to look at tax fairness (especially in the investment branch) and standing to challenge tax laws (especially in the religion branch).

When I teach federal income tax, I always let my students know my background. Which is this: I entered college as a saxophone performance major, and graduated as an English major. It wasn’t until law school that I discovered that tax law was a thing, much less that tax law was my calling. Continue reading “Hi, My Name Is Sam” →

Call for Papers: ClassCrits IX

Another call for papers has crossed our inbox; ClassCrits IX (“The New Corporatocracy and Election 2016”) is going to be on October 21-22. Like the SALT conference, it will be in Chicago (at my school, in fact!). And this one looks tailor-made for tax submissions. Excerpts from the call for papers: Continue reading “Call for Papers: ClassCrits IX” →

Introductory Post: Diane Ring

I am delighted to have joined my fellow tax bloggers in this consolidated blogging endeavor. I am Diane Ring, and I teach tax law in its many forms at Boston College Law School. Not surprisingly, my research has also focused on tax, with a primary emphasis on international tax, ethics, and corporate tax.

In the past few years, my international tax work has been examining the impact of contemporary trends in tax transparency and disclosure. On a separate track, my co-author (and fellow blogger) Shu-Yi Oei and I have been exploring a range of issues in the sharing economy, human capital contracts and other evolving commercial arrangements.

Although posts will likely reflect some of my formal research interests, I see tax everywhere and hope to share this view of the world through the blog. Although my students have pointed out that dogs have featured disproportionately (some might say excessively) in my exams over the years, I imagine canines will play a less prominent role in my posts — although I hold out hope.

My colleague at Boston College Law School, Jim Repetti, and I host a tax policy workshop bringing in outside speakers to present on a variety of interesting and diverse tax topics. These workshops will prove a great source of ideas, debates, and conversations, which I look forward to sharing in my posts.

Hello from David

First, I am very excited to be part of this ambitious tax blog platform. Thanks Sam and Shu-Yi for organizing this!

Since we do not know each other, I will put up my blog version of a tinder profile. Hopefully, according to tinder protocol, I get some “right-swipes.”

As a way of introduction, I am a tenured law professor at Valparaiso School of Law with a visiting position for the next two summers a Loyola Law School in Los Angeles. You can find my opinions in 120 characters on twitter @professortax.

I am an employed as a full time law professor. Therefore, it goes without saying that I write law review scholarship. But, based on citations, I assume only 5 or 6 of you read it. Rather than talk to this select few, last year, I made a conscious decision to be more involved with the public. I hoped to impart to the general public better understanding of taxes and how taxes relate to one’s everyday life. I accomplished this through writing articles and serving as background for reporters (with an occasional quote).

Continue reading “Hello from David” →

Hello world!

By: Shu-Yi Oei

I’m excited to be blogging on this site!

By way of introduction, I’m Shuyi. I teach tax classes and a legal scholarship workshop at Tulane Law School. My research interests are largely in tax law, though I tend to get curious about bankruptcy law, debtor-creditor law, and social insurance issues as well.

A lot of my research to date has been about tax collections mechanisms (such as the federal tax lien and the offer in compromise procedure), social insurance issues, and forbearance in tax administration. More recently, I’ve been working on a series of projects with my co-author, Diane Ring, dealing with the sharing economy, income sharing, human capital contracts, and other innovative transactions. I’ve very much enjoyed both lines of research, for very different reasons. I’ll likely be posting about these and other topics on this blog.

Taxes aside, I’m also an erstwhile student of the martial arts and denizen of New Orleans. Expect to see posts about these things as well, to the extent that they relate to tax policy and tax teaching.

Finally, we’ve been fortunate at Tulane Law to have the opportunity to host a number of tax and non-tax scholarly events, including our regular faculty workshop series, an annual tax roundtable, a property law roundtable, and a legal scholarship workshop series focused on the regulation of economic activity. I’ll blog here about scholarly happenings at Tulane Law and Tulane’s Murphy Institute as well.