Columbia Journal of Tax Law最新文献

{"title":"Tax-Exempt Hospitals and Their Communities","authors":"Susannah Camic Tahk","doi":"10.7916/CJTL.V6I1.2826","DOIUrl":"https://doi.org/10.7916/CJTL.V6I1.2826","url":null,"abstract":"Hospitals in the U.S. have long been able to obtain exemption from federal income tax because they meet the requirement known as the standard of “community benefit.” Yet lawmakers and scholars know virtually nothing about the actual workings of tax-exempt hospitals, or about whether, how, and to what extent they deliver benefits to their communities. Within the last five years, however, IRS tax return forms have started asking hospitals to quantify these benefits, as well as to give detailed information about their financial practices with respect to their patients. These new questions coincide with new requirements for tax-exempt hospitals put in place as part of 2010’s health care reform bill, the Affordable Care Act. The new tax return data offers a first-time opportunity to evaluate the workings of tax-exempt hospitals from the perspective of both the traditional requirements for tax-exempt hospitals and the 2010 reforms of the Affordable Care Act. This Article analyzes data from all tax-exempt hospitals in the U.S. in 2012 to show that tax-exempt hospitals differ widely in their provision of community benefits (and financial practices). In particular, these activities vary systematically in relation to their different notions of “community” and the characteristics of the communities where the hospitals are located. This evidence demonstrates that tax-exempt hospitals seem to be responding to the specific needs of their own communities when allocating their resources among different community-benefit activities. The data show, in addition, that while tax-exempt hospitals are generally adopting the financial policies that Congress and the IRS are requesting, hospital financial aid policies also vary by community. These findings raise several fundamental questions for lawmakers and tax policy scholars in the era of the Affordable Care Act. In particular, the findings suggest that lawmakers need to grapple seriously with how they allow tax-exempt hospitals to define their communities. For example: is it appropriate for tax-exempt hospitals merely to benefit a narrowly defined community or should they operate in terms of a broader understanding of community? In light of the new data presented, this Article considers these questions and outlines several alternatives to the “community benefit” standard to address them.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"30 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2014-09-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"117035041","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Unique Case of Treasury Regulations Issued to Prevent Abuse","authors":"J. Olsen","doi":"10.7916/CJTL.V4I2.2818","DOIUrl":"https://doi.org/10.7916/CJTL.V4I2.2818","url":null,"abstract":"The Administrative Procedures Act prescribes procedural requirements that govern the rulemaking activities of administrative agencies, including the Internal Revenue Service. It imposes, inter alia, notice and comment requirements which an agency may only bypass for good cause. While the Treasury Department’s assertion of the good cause exception when promulgating regulations to prevent tax abuse is a plausible application of the exception, it is distinguishable from typical assertions of good cause in one critical respect. Unlike many other agencies claiming good cause to bypass the notice and comment procedure, the Internal Revenue Service’s organic statute provides a viable alternative by allowing for the retroactive application of regulations issued to prevent abuse. As a result, two functionally equivalent approaches to combat tax abuse emerge, differentiated only by the presence or absence of public participation in rulemaking processes. By comparing the public policy ramifications of these different rulemaking approaches, I contribute to key policy debates centering on administrative rulemaking procedures. I find that issuing regulations under the good cause exception provides efficiency gains, but does so at the expense of increased litigation risk and a failure to mitigate the principal-agent problem animating the rulemaking requirements in the Administrative Procedures Act. On the other hand, regulations issued retroactively reduce agency costs, provide modest efficiency gains and partially outsource the burden of compliance to interested constituents who participate in rulemaking processes. On these grounds, I conclude that Treasury’s assertion of good cause to promulgate regulations to prevent abuse is unconvincing given the viable alternative of retroactive application of finalized regulations. These conclusions are specific to the trade-offs inherent when Treasury promulgates regulations to prevent tax abuse, but also speak to IRS compliance with the Administrative Procedures Act more generally.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"80 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2013-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129693866","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Making Partnerships Work for Mom and Pop and Everyone Else","authors":"Emily L. Cauble","doi":"10.7916/D8ZW1K94","DOIUrl":"https://doi.org/10.7916/D8ZW1K94","url":null,"abstract":"Entities treated as partnerships for tax purposes cover the spectrum from small Mom and Pop operations to mammoth enterprises owned by sophisticated partners. Designing tax law to govern this diverse array of entities is a challenging exercise since rules that are well suited to provide simplicity for entities at the small, unsophisticated end of the continuum may be poorly designed for preventing manipulation by entities at the large, sophisticated end of the continuum. However, a careful examination of how tax rules can best promote simplicity reveals opportunities for reform that would make the law more appropriate for entities all along the continuum.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"28 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-08-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122230256","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"To Confuse and Protect: Taxes and Consumer Protection","authors":"Jacob Nussim","doi":"10.7916/D8V42216","DOIUrl":"https://doi.org/10.7916/D8V42216","url":null,"abstract":"Imperfect information may cause rationally bounded individuals to make consistent mistakes. This paper focuses on potential misperception of prices. Consumers may underestimate the full price of tax-exclusive prices and hence overconsume goods and services. Countries with a significant consumption tax base (for example, a value-added tax) regulate tax-inclusive price presentation to overcome consumers’ biases and thus to protect consumers. The United States is considering the adoption of a federal consumption tax base and therefore may be similarly expected to regulate tax-inclusive price presentation. Based on a theory of optimal taxation, this paper explains why tax-exclusive rather than tax-inclusive prices can be socially desirable. To the extent that tax-exclusive pricing confuses consumers who then ignore non-indicated taxes and overconsume, consumers may be better off. The argument is counterintuitive, in particular for consumer protection advocates: confusion is actually good for consumers. The paper investigates several potential justifications for tax-inclusive pricing, and shows that a reasonably accepted rationale is rather limited in scope and unrelated to consumer-protection motivations. Finally, the paper extends the analysis to income-based taxes and to misleading non-tax (marketing) practices.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"18 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2010-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127678773","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Narrowing the Tax Gap Through Presumptive Taxation","authors":"Kyle D. Logue, Gustavo Gonçalves Vettori","doi":"10.2139/SSRN.1567240","DOIUrl":"https://doi.org/10.2139/SSRN.1567240","url":null,"abstract":"This Article highlights the primary tax enforcement problem in the United States, that of noncompliant small and medium-sized businesses (“SMBs”), and it explores the possibility of a radical solution: shifting away from the current system, which attempts to tax the actual income of each business, and toward a system that taxes only a rough approximation (or probabilistic estimate) of business income. This sort of presumptive tax approach has been used for years in developing economies, where the problem of SMB noncompliance is even worse than in the U.S. This Article argues that the time has come to at least consider various ways of taxing SMBs in the U.S. on a presumptive basis as well. The particular regime that the Article spends the most time developing is a type of modified gross receipts (MGR) tax of the sort that is used in some developing economies. Under our version of the MGR approach, SMB taxpayers would be taxed on a rough estimate of their annual income using (a) their reported gross receipts and (b) presumed profit ratios based on historical line-of-business profit margins. Whether such a regime would make sense depends on a number of key unanswered questions, including how narrowly and accurately such historical line-of-business profit percentages can be drawn and at what cost. We also discuss whether such a regime should be mandatory or optional; and, if mandatory, whether it should be only a mandatory minimum (like the alternative minimum tax) or both a minimum and maximum. Moving to an MGR approach to taxing SMB income would require a major change in the Internal Revenue Code. As a more modest alternative, the Article also considers instead having the IRS begin to use presumptive-tax principles as part of their audit strategies. If the Service could credibly commit to applying some form of presumptive/probabilistic tax system in its auditing decisions (perhaps as part of the Discriminate Index Function), and if taxpayers reacted rationally to such an audit policy, the results could be similar to an optional presumptive business income tax.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"53 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2010-03-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133042736","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"'Establishment': A Core Concept In Chinese Inbound Income Taxation","authors":"W. Cui","doi":"10.7916/D8795BH2","DOIUrl":"https://doi.org/10.7916/D8795BH2","url":null,"abstract":"Analogous with the concept of a US \"trade or business\" in US federal income tax law, the concept of \"establishment\" under Chinese tax law determines the boundary between net-income and gross-income taxation of inbound investments. As central as the concept is, it has received surprisingly little interpretation. As China increasingly opens to foreign portfolio investment and makes new non-corporate business forms available to foreigners, the term is urgently in need of clarification.This Article describes the recent regulatory and commercial developments in China that may rekindle interest in elaborating the meaning of \"establishment.\" It then discusses the interpretations that have been given to the concept under existing law and attempts to identify the policy issues that these interpretations implicitly touch on but fail to explicitly confront. Finally, the Article looks at the overall tax policy stance towards foreign portfolio investment that may reasonably be attributed to China. China's large surpluses in current and capital accounts and currency reserves make it doubtful that China will follow the US model for taxing foreign investment in the near term. Nonetheless, the government would be well advised to adopt an interpretation that permits foreign portfolio investment already identified as beneficial for China.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"65 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2010-02-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126295229","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Sound and Fury of Carried Interest Reform","authors":"K. Burke","doi":"10.2139/SSRN.1432552","DOIUrl":"https://doi.org/10.2139/SSRN.1432552","url":null,"abstract":"Of all the proposals advanced in recent years to reform Subchapter K, the part of the Internal Revenue Code governing partnership tax, perhaps none has generated more acrimony and confusion than the pending carried interest legislation contained in proposed § 710. While reformers have framed the issue of taxing the compensatory portion of a service partner's return as ordinary income in terms of distributive justice, critics have been quick to invoke the rhetoric of class warfare to fend off reform. In the most elementary terms, the carried interest legislation would tax some (but not all) of a service partner's share of partnership profits as ordinary income. Even at this basic level, however, the contours of the proposed legislation are ambiguous. Indeed, the reform is sometimes misdescribed as taxing \"distributions\" rather than \"distributive shares\" as ordinary income, a distinction that is fundamental. Moreover, the precise tax advantage of carried interest arrangements depends crucially on whether one adopts a \"joint-tax\" perspective or focuses more narrowly on the service partner's opportunity for deferral and conversion. Apart from the merits of carried interest legislation, there is also considerable dispute over whether such reform is likely to raise significant amounts of revenue.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"40 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2010-02-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128575067","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Who Pays the Price of Civilization","authors":"E. Juan","doi":"10.7916/CJTL.V9I1.2858","DOIUrl":"https://doi.org/10.7916/CJTL.V9I1.2858","url":null,"abstract":"Current events appear to challenge preconceptions of civilization.  On opposite sides of the ocean, heads of state are associated with “alternative facts,” alleged fratricide, or death squads.[1]  Central to the received notions shaken by these developments would be the rule of law. Can rational legality survive apparently aberrant administrations?  To address this question, this Article introduces the evolutionary context from which the rule of law arose.  To balance inaccuracies of generalization, this Article proceeds with case studies from both America and overseas. \u0000As a particular field of compliance (or noncompliance) with the rule of law, the Article focuses on tax law.  As U.S. Justice Oliver Wendell Holmes, Jr. opined in a landmark trans-Pacific case, “Taxes are what we pay for civilized society.”[2]   The reasons why people do or don’t comply with taxation may offer insight into legal compliance generally.  Thus, a case study of tax may have implications for popular adherence to the rule of law.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"40 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123749703","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Circular Argument: What is Wrong, and Right, with the Circular 230 ‘Covered Opinion’ Regulations","authors":"Steven Z. Hodaszy","doi":"10.7916/D8FT9SVG","DOIUrl":"https://doi.org/10.7916/D8FT9SVG","url":null,"abstract":"The covered opinion regulations set forth in Treasury Department Circular 230 impose a number of stringent requirements on the provision of written tax advice by attorneys, accountants and others admitted to practice before the Internal Revenue Service. Since they became effective in 2005, the covered opinion regulations have been disparaged by both practitioners and scholars as overly broad and unduly burdensome. The regulations were originally intended to govern advice concerning potentially abusive tax shelters; however, they are drafted so broadly that they actually apply to written opinions regarding virtually any tax matter – including routine and legitimate tax planning. On the occasion of their five-year anniversary, attorney Steven Z. Hodaszy examines the covered opinion regulations and analyzes whether their benefits justify their burdens. Hodaszy contends that, because of a continuing need to reign in unscrupulous opinion practices in the tax shelter area, some form of the regulations must remain in place. Yet he also maintains that the regulations should be reformed so that they clearly apply only to tax shelter advice (as they were meant to). To accomplish this, Hodaszy proposes a specific textual revision to the regulations’ definition of a “covered opinion.” In conjunction with that proposal, he argues for the repeal of rules that presently allow practitioners to opt out of compliance with the regulations under some circumstances. Similarly, he rejects calls to restrict application of the regulations to practitioners who “opt in” to compliance with them. Neither the current “opt-out” rules nor an alternative “opt-in” approach would be justifiable, once the covered opinion regulations are appropriately restricted to advice concerning tax shelters. Moreover, as Hodaszy explains, either maintaining the “opt-out” rules or replacing them with an “opt-in” regime could effectively vitiate the regulations altogether, in the advent of a new strict-liability accuracy-related penalty for transactions lacking economic substance. Hodaszy asserts that, with the changes he proposes, the covered opinion regulations can instead continue to function as an important tool to deter abusive tax shelters, but without imposing detrimentally on other areas of tax practice.","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"7 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131024056","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Realization and Progressivity","authors":"Ilan Benshalom, K. Stead","doi":"10.7916/D8PC31SW","DOIUrl":"https://doi.org/10.7916/D8PC31SW","url":null,"abstract":"The realization requirement is the income tax’s original sin. Although longstanding, it is widely considered the main source of tax complexity, inequity, and economic distortion. Despite these problems, realization is also considered a fundamental element of modern income tax regimes. It is explained early in most federal income tax courses as necessitated by problems of asset valuation and taxpayer liquidity. To the dismay of certain professors, this explanation usually generates little class discussion. More worrisome, it is also widely accepted outside the classroom— prompting few political objections or normative academic inquiries. The goal of this article is to provide a normative framework that allows policymakers to better understand the role of the realization requirement. It makes two related arguments. First, with respect to certain emotionally non-fungible (personal) assets, the realization requirement is normatively justified because the market price is not a good indication of the assets’ value to their owners. Second, contrary to the traditional view of realization as a regressive element, taxing only these personal assets upon realization would promote income tax progressivity. This article’s normative approach provides a basis for developing a more effective and coherent redistributive income tax policy. This analysis contributes to the broader tax reform debate and opens a novel theoretical inquiry with respect to the distributive impact of different types of errors. * Associate Professor Hebrew University. LL.B. Hebrew University of Jerusalem, LL.M. University College London, LL.M. & J.S.D. Yale Law School. We are thankful to the following people for all of their comments and suggestions along the way: Reuven Avi-Yonah, Edna Benshalom, Gadi Benshalom, Tom Brennan, Assaf Hamdani, Sharon Hannes, Stephanie Hoffer, Susan Morse, David Pozen, and Edward Zelinsky. We would also like to thank participants of the University of Toronto Faculty of Law Tax Policy Workshop for their very helpful comments. We would like to extend special thanks to Ben Alarie, Avital Benshalom, David Enoch, Lee Fennell, Alon Harel, Sarah Lawsky, Debra Lefler, Daphna Lewinsohn-Zamir, Jacob Nussim, Diane Ring, and Eyal Zamir for their detailed comments. Most of all, we would like to thank Avihay Dorfman and David Gamage for their invaluable framing and substantive comments. ** J.D. Northwestern University School of Law. I would like to thank Ryan Sniatecki, Scott Lerner, and Jonathan Conon for their thoughtful comments. 44 COLUMBIA JOURNAL OF TAX LAW [Vol.3:43 INTRODUCTION 45\u2029 I.\u2029 THE REALIZATION REQUIREMENT—COSTS AND ENDURANCES OF AN ACHILLES’ HEEL 49\u2029 A.\u2029 The Function and Social Costs of the Realization Requirement 49\u2029 B.\u2029 Technical in Nature—The Valuation Liquidity Consensus 53\u2029 II.\u2029 WITH IT OR WITHOUT IT? EXISTING APPROACHES TO REALIZATION.... 55\u2029 A.\u2029 Without It: A Less Realization-Based Income Tax Regime 55\u2029 B.\u2029 With It: Some Hidden Justifications for Real","PeriodicalId":368484,"journal":{"name":"Columbia Journal of Tax Law","volume":"37 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125041039","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}