Wednesday, July 20, 2005
The Code is Simple? NOT!
The People's Tax Lawyer has posted a defense of the Internal Revenue Code, concluding that it is "model of clarity and simplicity for all it is to accomplish" and that it "is not too complex." The People's Tax Lawyer concludes, "Our Code is clear, simple, and well organized."
In all fairness, much of the post is a complaint about failings in the organization and other features of Treasury Regulations. There will be no argument from me that this complaint lacks justification. My students often hear and see specific examples of bad drafting practices evident in the regulations. The cross-referencing in the section 704(b) regulations (e.g., "(1) and (2) of (b)(2)(ii) of this section" rather than "the first two prongs of the three-prong test" is one of my favorite examples).
But to characterize the Code as clear and simple suggests familiarity breeds affection. At least for the People's Tax Lawyer. But not for me. True, the Code is decently organized. It is not well written. Ask any basic tax student about the "bears to" language that could be, as it is in some instances, a simple "multiplied by a fraction, the numerator of which...." construct. Consider that sometimes effective dates are in a code section, other times in uncodified amending legislation. Consider that parts of section 167 that still apply have been repealed. Check out the application of section 1245 to ACRS property, which requires digging through "old' versions of the Code with several amending acts in hand. Consider the numerous uses of the "we'll let the IRS finish writing the statute" approach. Consider the enumeration of a certain number of paragraphs in a subsection, suggesting that there are those number of requirements, when in fact several requirements are buried in the introductory language. Take a peek at section 71(b) to see that inconsistency.
Of course, when one turns to substance, the Code gets even more convoluted. What is the definition of a small business corporation? Yes, which one? Or the "Notwithstanding provision x, a z is not a z if a w has been held for t years during the time that the z would have been a z but for this rule" grammatically absurd and incomprehensibly dense tweaks grafted onto what might otherwise be a clear and cogent definition. Or perhaps it would be fun to count the many different ways inflation adjustments are computed and rounded?
Some of my professional writing for Tax Management, Inc., involves the exposition and analysis of the tax law as found in the Code (the rest involves regulations, rulings, cases, etc.). Much of the time I take what is in the Code and rewrite it, in English. Apparently there is a market for this translation, a conclusion I base on the number of tax practitioners (and others) who use the portfolios in which I do this. Of course, I am joined by several or more hundred other authors providing the same service.
If the Code were so clear and simple as the People's Tax Lawyer contends, things such as Tax Management portfolios would not be necessary. Now, it could be that all the rest of us are lacking some special skill or insight, but I guarantee you there are times I read a Code provision, especially one recently enacted or amended, scratch my head (maybe that's why I'm losing my hair), read it again, read it to myself out loud, try to rewrite it, and sometimes begin inventing words to describe the poor quality of the provision.
And eventually along come the technical corrections. I wonder why those are necessary, he asks sarcastically.
Sorry, People's Tax Lawyer, on this one I flat out disagree. Even accepting the substantive mess that it has to reflect, the Code is not as well organized or drafted as it could be. After all, I think my translations are far less convoluted. I'll let the practitioners score that assertion.
In all fairness, much of the post is a complaint about failings in the organization and other features of Treasury Regulations. There will be no argument from me that this complaint lacks justification. My students often hear and see specific examples of bad drafting practices evident in the regulations. The cross-referencing in the section 704(b) regulations (e.g., "(1) and (2) of (b)(2)(ii) of this section" rather than "the first two prongs of the three-prong test" is one of my favorite examples).
But to characterize the Code as clear and simple suggests familiarity breeds affection. At least for the People's Tax Lawyer. But not for me. True, the Code is decently organized. It is not well written. Ask any basic tax student about the "bears to" language that could be, as it is in some instances, a simple "multiplied by a fraction, the numerator of which...." construct. Consider that sometimes effective dates are in a code section, other times in uncodified amending legislation. Consider that parts of section 167 that still apply have been repealed. Check out the application of section 1245 to ACRS property, which requires digging through "old' versions of the Code with several amending acts in hand. Consider the numerous uses of the "we'll let the IRS finish writing the statute" approach. Consider the enumeration of a certain number of paragraphs in a subsection, suggesting that there are those number of requirements, when in fact several requirements are buried in the introductory language. Take a peek at section 71(b) to see that inconsistency.
Of course, when one turns to substance, the Code gets even more convoluted. What is the definition of a small business corporation? Yes, which one? Or the "Notwithstanding provision x, a z is not a z if a w has been held for t years during the time that the z would have been a z but for this rule" grammatically absurd and incomprehensibly dense tweaks grafted onto what might otherwise be a clear and cogent definition. Or perhaps it would be fun to count the many different ways inflation adjustments are computed and rounded?
Some of my professional writing for Tax Management, Inc., involves the exposition and analysis of the tax law as found in the Code (the rest involves regulations, rulings, cases, etc.). Much of the time I take what is in the Code and rewrite it, in English. Apparently there is a market for this translation, a conclusion I base on the number of tax practitioners (and others) who use the portfolios in which I do this. Of course, I am joined by several or more hundred other authors providing the same service.
If the Code were so clear and simple as the People's Tax Lawyer contends, things such as Tax Management portfolios would not be necessary. Now, it could be that all the rest of us are lacking some special skill or insight, but I guarantee you there are times I read a Code provision, especially one recently enacted or amended, scratch my head (maybe that's why I'm losing my hair), read it again, read it to myself out loud, try to rewrite it, and sometimes begin inventing words to describe the poor quality of the provision.
And eventually along come the technical corrections. I wonder why those are necessary, he asks sarcastically.
Sorry, People's Tax Lawyer, on this one I flat out disagree. Even accepting the substantive mess that it has to reflect, the Code is not as well organized or drafted as it could be. After all, I think my translations are far less convoluted. I'll let the practitioners score that assertion.
Monday, July 18, 2005
Hello, Taxes
I begin my Introduction to Federal Taxation Class, after getting through the "housekeeping" details, with an illustration of the federal and state income tax liabilities of someone who earns roughly what a first-year associate at a medium-sized Philadelphia law firm would earn. My goal is to orient students to thinking in terms of post-tax income. Why? Primarily to provide an overview of how income taxes are computed, but also to awaken students to the idea that a person who earns $x a year cannot spend $x a year without going into debt, digging into savings, or hitting up relatives for gifts. It's a reality check. Every year there are audible reactions from some students.
Last week I received an email from a former student whose experience with taxes in a work world setting had a more profound impact than did the classroom example. He wrote, with redactions intended to shield his identity:
1. If all he earns for the year is the $4500, he will have no federal income tax liability. Someone appears to be withholding at a rate based on a $27,000 annual salary. It often happens with summer jobs, and can be prevented by indicating no withholding on the W-4 form. Most people miss that option.
2. As a resident of State Q, he is subject to withholding of state Q income tax. As best as I understand that state's income tax, he will have liability even if he earns only $4500 for the year. I don't think there is a "do not withhold it's only a summer job" option for that state.
3. The two FICA taxes are social security and medicare. Unless the wages are exempt, and in this instance they are not, it's bye-bye to 7.65% of the $4500. In a follow-up email, he indicated that if he dies before working 40 qualifying quarters, the money is gone. I think that is correct. That's simply another aspect of the pyramid scheme of the current FICA system.
4. Why is a Radnor tax withheld when he is a resident of another state and working in yet another one? The answer is that because Villanova is writing the fellowship checks for the work done in the other state, the Radnor tax must be withheld. That's a flaw in the ordinance. The EMS (emergency and municipal services) tax ought not apply to someone who is imposing NO burden on the Radnor emergency or municipal services systems.
5. These arre four different taxes, enacted by three different jurisdictions. Changing the Internal Revenue Code would have no effect on the Radnor EMS tax glitch. Nor would it affect the state Q income tax. Reforming the federal income tax would not fix the FICA problem. In fact, of all the problems, the one that is most transitory and easily handled is the federal income tax W-4 withholding option. I suppose somewhere, somehow I didn't even try to get that point across in class (mostly because it is a small bit on a huge structure to which only 42 50-minute sessions are devoted).
So if a law student who takes a federal income tax course has this sort of taxing experience, what's it like for everyone else? Surely not fun. Perhaps unpleasant.
Last week I received an email from a former student whose experience with taxes in a work world setting had a more profound impact than did the classroom example. He wrote, with redactions intended to shield his identity:
The reason I am writing is that I now more than ever feel the need for the tax code and current tax structure to be overhauled. As you may recall, I am receiving a fellowship for my work this summer from PIFP. Fellows receive a $4500 total fellowship, but the actual pay is so far removed from this figure. There are six gross payment of 750 each that are disbursed to students over the summer. I was shocked to discover that my last net pay was a mere $580, after two FICA taxes, federal withholding tax, [state Q] state tax, AND a $52 Radnor EMS tax (even though I am not working in Radnor, but in [city D in State R], leaving a meager $580. Is it just me or is there something wrong with the system? Just wanted to send my thoughts to youLet's take this apart.
1. If all he earns for the year is the $4500, he will have no federal income tax liability. Someone appears to be withholding at a rate based on a $27,000 annual salary. It often happens with summer jobs, and can be prevented by indicating no withholding on the W-4 form. Most people miss that option.
2. As a resident of State Q, he is subject to withholding of state Q income tax. As best as I understand that state's income tax, he will have liability even if he earns only $4500 for the year. I don't think there is a "do not withhold it's only a summer job" option for that state.
3. The two FICA taxes are social security and medicare. Unless the wages are exempt, and in this instance they are not, it's bye-bye to 7.65% of the $4500. In a follow-up email, he indicated that if he dies before working 40 qualifying quarters, the money is gone. I think that is correct. That's simply another aspect of the pyramid scheme of the current FICA system.
4. Why is a Radnor tax withheld when he is a resident of another state and working in yet another one? The answer is that because Villanova is writing the fellowship checks for the work done in the other state, the Radnor tax must be withheld. That's a flaw in the ordinance. The EMS (emergency and municipal services) tax ought not apply to someone who is imposing NO burden on the Radnor emergency or municipal services systems.
5. These arre four different taxes, enacted by three different jurisdictions. Changing the Internal Revenue Code would have no effect on the Radnor EMS tax glitch. Nor would it affect the state Q income tax. Reforming the federal income tax would not fix the FICA problem. In fact, of all the problems, the one that is most transitory and easily handled is the federal income tax W-4 withholding option. I suppose somewhere, somehow I didn't even try to get that point across in class (mostly because it is a small bit on a huge structure to which only 42 50-minute sessions are devoted).
So if a law student who takes a federal income tax course has this sort of taxing experience, what's it like for everyone else? Surely not fun. Perhaps unpleasant.
Friday, July 15, 2005
A Tax Dirt Book. Really.
The story begins when the IRS decides to write a history of its criminal enforcement activities. Presumably it was an anniversary project, as it is called "75 Years of IRS Criminal Investigation History" and covers IRS criminal enforcement from 1919 through 1994. Part of it is a republication of a 1936 summary coveringa mere 17 years of enforcement efforts.
It describes individual cases involving celebrities, public figures, politicians gone bad, organized crime syndicate members, and others. Some of the stories are familiar: Al Capone, George Raft, Teapot Dome, Bobby Baker, and hundreds more. There are names, dates, dollar amounts, and enough material to write several movie scripts, or more.
The story gets even more interesting when the IRS, after sending copies of the book to federal depositary libraries (such as the one at Villanova), determined that it ought not to have done so because of personal tax information in the book. It asked the libraries to return the book. Hah, hah. A Freedom of Information Act request to the IRS for the book brings a heavily redacted document. The horses are out of the barn and the IRS has shut the door and stands guard over it.
Steven Aftergood of the Federation of American Scientists' Project on Government Secrecy scanned the book. Michael Ravnitzky, who brought this to my attention, proofread it. You can find it at The Memory Hole web site.
It's well worth the read. I've read parts of it, skimming through and stopping when I saw a recognizable name. I'm sure when I go back and read about the unfamiliar names I'll find more good tales. Anyone teaching or praticing in the criminal tax law area must read this. The rest of us tax folks should. And taxpayers generally might find some interesting beach or mountain lake reading. After all, the American public seems to like reality shows, and what's more real than a tax fraud case? Talk about FEAR FACTOR. OK, if there's not a movie script, surely a Fox reality show. TAX CHEATS. Talk about desperate. Sorry, it's late.
It describes individual cases involving celebrities, public figures, politicians gone bad, organized crime syndicate members, and others. Some of the stories are familiar: Al Capone, George Raft, Teapot Dome, Bobby Baker, and hundreds more. There are names, dates, dollar amounts, and enough material to write several movie scripts, or more.
The story gets even more interesting when the IRS, after sending copies of the book to federal depositary libraries (such as the one at Villanova), determined that it ought not to have done so because of personal tax information in the book. It asked the libraries to return the book. Hah, hah. A Freedom of Information Act request to the IRS for the book brings a heavily redacted document. The horses are out of the barn and the IRS has shut the door and stands guard over it.
Steven Aftergood of the Federation of American Scientists' Project on Government Secrecy scanned the book. Michael Ravnitzky, who brought this to my attention, proofread it. You can find it at The Memory Hole web site.
It's well worth the read. I've read parts of it, skimming through and stopping when I saw a recognizable name. I'm sure when I go back and read about the unfamiliar names I'll find more good tales. Anyone teaching or praticing in the criminal tax law area must read this. The rest of us tax folks should. And taxpayers generally might find some interesting beach or mountain lake reading. After all, the American public seems to like reality shows, and what's more real than a tax fraud case? Talk about FEAR FACTOR. OK, if there's not a movie script, surely a Fox reality show. TAX CHEATS. Talk about desperate. Sorry, it's late.
What a Way for Tax to Meet Apostille
Warren Rojas of Tax Notes, made this connection between my recent posts (here and here) on the word for the streamlined process for authenticating documents internationally and the sentencing of a Hull, Massachusetts, man for bank fraud. The fellow generated false tax and income statements in his wife's name and used those documents to obtain loans. Here's the clincher:
And he used tax forms to do his deeds, too. I knew there was a connection.
EDELKIND, who filed for bankruptcy in October 1999, used his wife's name on all of the loans. EDELKIND prepared loan applications in his wife's name, listing fictitious employment and income information, backed up by forged tax and payroll records. EDELKIND fabricated a variety of documents, including forged "W-2" Wage and Tax Statements and tax returns. As the loans got larger, the amount of income claimed grew as well. Early in the scheme EDELKIND submitted records showing that his wife had an annual income of roughly $200,000 -- by the end he claimed she earned $1.1 million as Chief Operating Officer of a company called Apostille, Inc.So even the con artist (who gave an address for Apostille, Inc. that postal authorities said would be in the Atlantic Ocean) knew about this word and I didn't. Proof I don't know everything.
And he used tax forms to do his deeds, too. I knew there was a connection.
Monday, July 11, 2005
More Tax Pictures
Andrew Mitchel is at it again. I pointed out in this post of two weeks ago that he had put together a collection of charts depicting a variety of corporate tax cases and the reorganization provisions. Now he has added a group of section 367 charts to his Andrew Mitchel LLC - International Tax Services web site. Defintely worth a look by those studying, teaching, or using these provisions.
Big Brother Getting Bigger?
Some things don't mix. Oil nd water come to mind. Some things ought not be allowed to mix. Drinking and driving, for example.
So how about this hook-up? Choicepoint and the IRS.
Choicepoint, as most news readers know, from stories such as this one, is a data gathering enterprise that became (in)famous after the personal and confidential records hundreds of thousands of indiividuals were stolen from the company's computers. Now along come the IRS, according to reports such as this one, which awards a 5-year contract to Choicepoint to run IRS data batch processes. The contract could amount to as much as $20 million.
Isn't this nice? Get lax with security, put other people's data, identity and even lives at risk, and be rewarded with a government contract. This suggests that the IRS managers who entered into the arrangement didn't think there was anyone else out there who could be better at what counts, at least not at the specified price.
Fortunately, members of Congress have jumped in to criticize and even attempt to stop the implementation of the contract. Senator Patrick Leahy, joined by Senator Arlen Specter, in a bipartisan effort, has called for a review of the contract to ensure that taxpayer data and privacy are protected. Representative Ed Markey, using a nice word twist, pointed out that the contract left taxpayers with no choice about the destination and spread of their data.
The IRS responded by ordering a full review of the contract. Considering what's at stake and Choicepoint's track record, it had best be a thorough review. I doubt a confirmation of the contract will sit well with people, especially those whose lives have been inconvenienced and ruined by the "make profits at others' expense" philosophy of most big business enterprises.
Other than pressure their legislators, what can taxpayers do? Not much. So, as usual, this falls back on the Congress. It writes the tax laws. It created the IRS. It appropriates tax dollars to the IRS. So it had best do its duty.
So how about this hook-up? Choicepoint and the IRS.
Choicepoint, as most news readers know, from stories such as this one, is a data gathering enterprise that became (in)famous after the personal and confidential records hundreds of thousands of indiividuals were stolen from the company's computers. Now along come the IRS, according to reports such as this one, which awards a 5-year contract to Choicepoint to run IRS data batch processes. The contract could amount to as much as $20 million.
Isn't this nice? Get lax with security, put other people's data, identity and even lives at risk, and be rewarded with a government contract. This suggests that the IRS managers who entered into the arrangement didn't think there was anyone else out there who could be better at what counts, at least not at the specified price.
Fortunately, members of Congress have jumped in to criticize and even attempt to stop the implementation of the contract. Senator Patrick Leahy, joined by Senator Arlen Specter, in a bipartisan effort, has called for a review of the contract to ensure that taxpayer data and privacy are protected. Representative Ed Markey, using a nice word twist, pointed out that the contract left taxpayers with no choice about the destination and spread of their data.
The IRS responded by ordering a full review of the contract. Considering what's at stake and Choicepoint's track record, it had best be a thorough review. I doubt a confirmation of the contract will sit well with people, especially those whose lives have been inconvenienced and ruined by the "make profits at others' expense" philosophy of most big business enterprises.
Other than pressure their legislators, what can taxpayers do? Not much. So, as usual, this falls back on the Congress. It writes the tax laws. It created the IRS. It appropriates tax dollars to the IRS. So it had best do its duty.
Friday, July 08, 2005
Apostille II
No sooner had I posted my "discovery" of the apostille, both word and process, than the English major and expert of the family sent this:
http://switzerland.isyours.com/e/faq/apostille.htmlSo kudos to my sister for digging this up. And thanks. I don't think I would have guessed a Greek origin.
What is an apostille?
An apostille is a special seal applied by an authority to certify that a document is a true [sic] copies of an original. Apostilles are available in countries, which signed the Hague Convention Abolishing the Requirement of Legalization of Foreign Public Documents, popularly known as The Hague Convention. This convention, created in 1961, replaces the time consuming chain certification process used so far, where you had to go to four different authorities to get a document certified.
www.wordfocus.com
apo-,
wordinfoap-, aph- (Greek: from, away from, asunder, separate, separation from, derived from; used as a prefix).
tillo-,
wordinfotill- (Greek: to pluck, tear, pull).
Wednesday, July 06, 2005
Apostille
One never knows when one will learn something new. For me, this time, it was during a visit with one of my cousins, retired from the diplomatic corps. We were discussing estate planning, and the fact that Portugal, where he owns a property does not "understand" or recognize the trust. The lawyer in Portugal needed some documents, including some tax papers, and they had to be certified.
Once upon a time it worked as follows. Let's assume a county tax document. The document was taken to the county court house, where the clerk certified the document. Then it was forwarded to a state official, who certified that the certifying county clerk was indeed who he or she claimed to be. Then this was forwarded to the state's Department of State, which certified the authenticity of the state official's certification. Then it went, if I am remembering this correctly, to the U.S. State Department, which certified it to the other country's consulate or embassy, and then it made its way to the lawyer in the other country.
Fortunately, the U.S. entered into a treaty that streamlined the process. It calls for something called an APOSTILLE. No, not apostle. After I left, my cousin sent me the link to this explanation of an apostille.
Perhaps you knew about this. I didn't. I've learned some law. So, if you ever need to certify a tax or other document to another country, that's how it's done.
The word apparently is both a noun and a verb. At least it is used as a verb on that web site. Imagine if I used it playing Scrabble. I would be challenged. So would you. Now you have proof it's not a figment of your imagination. According to Webster's, it is a noun, not a verb, and it means " marginal note on a letter or other paper; an annotation". Look at the Webster's site for all sorts of trivia about the word. But I haven't found the origin of the word.
Once upon a time it worked as follows. Let's assume a county tax document. The document was taken to the county court house, where the clerk certified the document. Then it was forwarded to a state official, who certified that the certifying county clerk was indeed who he or she claimed to be. Then this was forwarded to the state's Department of State, which certified the authenticity of the state official's certification. Then it went, if I am remembering this correctly, to the U.S. State Department, which certified it to the other country's consulate or embassy, and then it made its way to the lawyer in the other country.
Fortunately, the U.S. entered into a treaty that streamlined the process. It calls for something called an APOSTILLE. No, not apostle. After I left, my cousin sent me the link to this explanation of an apostille.
Perhaps you knew about this. I didn't. I've learned some law. So, if you ever need to certify a tax or other document to another country, that's how it's done.
The word apparently is both a noun and a verb. At least it is used as a verb on that web site. Imagine if I used it playing Scrabble. I would be challenged. So would you. Now you have proof it's not a figment of your imagination. According to Webster's, it is a noun, not a verb, and it means " marginal note on a letter or other paper; an annotation". Look at the Webster's site for all sorts of trivia about the word. But I haven't found the origin of the word.
Sunday, July 03, 2005
Independence, Taxes, and Homeownership
It's almost Independence Day. It's a day that means a lot of things to a lot of people. We have opportunities unlike those available to most people in the world. For example, what percent of the world's adults own their own home? In some countries, private home ownership is rare or reserved for a privileged few. Sometimes it's economics, but usually it's politics. And often when it is economics, it's really politics in disguise.
That's why the following response to my post several weeks ago on Home Price Sticker Shock is appropriate at the moment. Dave Harmon wrote:
Why is this so important? I think "pride of ownership" extends beyond care of the home to care of the community. Home owners have an investment flavored wth an emotional attachment not found in other investments (except, perhaps, cars, jewelry and collectibles). There are many freedoms in independence. Homeownership reflects one.
Happy Independence Day.
That's why the following response to my post several weeks ago on Home Price Sticker Shock is appropriate at the moment. Dave Harmon wrote:
Here in NYC, the housing boom is driving gentrification (bye-bye, Bowery) and pricing the middle class out of town. It was already messing with the demographics and social structure -- especially, police officers either can't afford to live in the communities they serve, or don't dare to (in the slums). Note that the slums are part of the same problem: these are places where the landlords can't score "enough" money from rent, so they don't bother with maintenance, let alone investment. They just wait for the developers to come along and buy them out, often with subsidies from the same City Hall that couldn't be bothered to deal with the neglect. I'm sure there are tax issues in there, but mostly it's just power politics.... ;-(Well, there is tax in this, from the beneficial impact of the real estate property tax deduction and the home mortgage interest deduction on home ownership, to the debilitating impact of rapidly rising local property taxes on continued ownership by citizens on fixed incomes, to the variety of incentives, gimmicks, and other control features woven into state and local tax law. If housing prices contine to escalate, and of course the question is whether they will, the tradition of private home ownership by the majority of citizens, nurtured and strengthened by American political and socio-economic characteristics, will be in jeopardy.
Why is this so important? I think "pride of ownership" extends beyond care of the home to care of the community. Home owners have an investment flavored wth an emotional attachment not found in other investments (except, perhaps, cars, jewelry and collectibles). There are many freedoms in independence. Homeownership reflects one.
Happy Independence Day.
Friday, July 01, 2005
Taxing Traffic?
This traffic backup/tieup simulator is VERY cool. Run the uphill grade variant and decide if the truck in the left land should be charged an "unwarranted use of left lane for passing beyond capability of truck engine" user fee. The technology exists to do this. Note that in the simulations there are no accidents, bad weather, etc. I was clued into this by a tax faculty colleague. Who says tax profs aren't forward thinking and capable of spotting the cool stuff?
Wednesday, June 29, 2005
Save Some Energy to Learn More New Tax Law
A little more than a week ago I posted a summary and critique of the energy bill approved by the Senate Finance Committee. Today it passed the Senate, 85-12. I guess my thoughts were influential n D.C. NOT!
Many practitioners tell me that they don't focus on pending legislation because it could turn out to be a wasted investment of precious time. That makes sense, to a point. Perhaps if these things got more attention on the public radar we would see better legislation. Then again, perhaps not. Dave Harmon wrote to me, in response to my critique:
And yes, practitioners, clear some room on your "learn more tax law" calendar. This one's on its way.
Many practitioners tell me that they don't focus on pending legislation because it could turn out to be a wasted investment of precious time. That makes sense, to a point. Perhaps if these things got more attention on the public radar we would see better legislation. Then again, perhaps not. Dave Harmon wrote to me, in response to my critique:
What ever made you think that the energy bill was intended to *help* our energy situation? ;-) Our current administration has a pattern of passing bills and laws that actively interfere with whatever they claim to be protecting or encouraging. "Patriot Act" undermines the Constitution, "Defense of Marriage" would keep (same-sex) people from getting married, "No Child Left Behind" attacks the school systems, "CAN-SPAM" requires you to respond to spammers to (supposedly) get off their lists, and so on ad nauseum.And don't get me started on the Department of Homeland (In-)Security!Although on some of these issues disageement divides the nation, on others it's almost unanimous: Congress does exactly the opposite of what should be done to accomplish what almost everyone agrees ought to be done. Who welcomes spam? Yet why confirm email addresses as Congress provided? Who wants higher energy costs? Yet who, ultimately, will pay the $11 billion cost of the energy bill, if enacted?
And yes, practitioners, clear some room on your "learn more tax law" calendar. This one's on its way.
Tuesday, June 28, 2005
Tax Fashion Getting Out of Hand?
My recent post on Taxes, Fashion Sense, and the Internet brought some additional information from Dave Harmon: Apparently Cafe Press will put a customer-provided picture or logo (within limits, I suppose) on t-shirts, mugs, whatever). So.... the possibilities of a MauledAgain mug/t-shirt/keychain endeavor is more than an idle threat. As in quip of a month ago:
But... still don't have a logo. Maybe a hammer (maul, get it>) with IRC on the handle coming down on my head?
My children must be glad they're of legal age. No fear that Dad will crank up some MauledAgain t-shirts for them to wear. Hmm. Wait a minute. MY kids would jump at the idea.So why am I out looking for souvenirs when I could order them up from home.
But... still don't have a logo. Maybe a hammer (maul, get it>) with IRC on the handle coming down on my head?
Sunday, June 26, 2005
More on the News Feed
In response to my announcement that I had put a FeedBurner newsfeed link on the blog, Raj A Kapadia of Mumbai, India, who reads the blog regularly, sent me this news:
It leaves me, though, with two questions. I've tried to research an answer to the first but had no success. Haven't tried to figure out the second.
1. How can I find out how many people have news feed subscriptions to the blog? Would that require aggregating statistics from each of the news feed subscription sites?
2. If I post something, and then change it (usually because of typos, sloppy HTML, or experimental HTML that ends up ugly), does the feed get replaced? Does a new feed go out each time I update the post? The one I just did on the tax charts was reposted three times until I could get the HTML the way I wanted it. If it refeeds each time, goodness, it's giving literally meaning to "MauledAgain," hahaha.
So, anyhow, there's a second news feed source for those who are interested in subscribing to the blog.
Actually, everyone who has a blog on Blogger also gets an Atom NewsFeed, the URL of which is <(URL of the Blog)/atom.xml>. Thus, the URL of the Atom NewsFeed of your Blog is http://mauledagain.blogspot.com/atom.xml. I SHOULD KNOW - I AM SUBSCRIBED TO THAT FEED SINCE THE PAST FEW MONTHS !!So, again, I learned something. Thanks, Raj.
It leaves me, though, with two questions. I've tried to research an answer to the first but had no success. Haven't tried to figure out the second.
1. How can I find out how many people have news feed subscriptions to the blog? Would that require aggregating statistics from each of the news feed subscription sites?
2. If I post something, and then change it (usually because of typos, sloppy HTML, or experimental HTML that ends up ugly), does the feed get replaced? Does a new feed go out each time I update the post? The one I just did on the tax charts was reposted three times until I could get the HTML the way I wanted it. If it refeeds each time, goodness, it's giving literally meaning to "MauledAgain," hahaha.
So, anyhow, there's a second news feed source for those who are interested in subscribing to the blog.
A Good Job of Picturing Tax
What's going on here? A Saturday post. A Sunday post. Yes, indeed, it's the summer schedule.
I'd like to bring to your attention a very interesting and useful tax resouce on the web that should be of interest to practitioners, tax law professors, and law students. It's the Andrew Mitchel LLC - International Tax Services web site, particularly the two resouces, Charts of Tax Cases and Reorganization Charts. Andrew, who combines an LL.M. and CPA and practices in Connecticut, specializes in international tax. Of course, because one cannot dig into that area of tax without understanding basic tax, corporate tax, and some other areas, Andrew, like the rest of us, worked through a variety of corporate tax cases and the reorganization provisions. And like many of us, he chose to design visualizations of the transactions. Charts, graphs, pictures, anything that appeals to the eye can be a great help in understanding tax law. That's the case here. As many of you know, I'm a very visually-focused person. That's why creating Powerpoint slides for my courses was a snap.... I had been drawing the pictures on the blackboard. Trust me, the Powerpoint visuals are MUCH more legible.
As I tell my students, there's no point in getting into black letter law until one understands the facts. Understanding the transaction often is the chief stumbling block for a tax student, and, of course, for many tax practitioners and judges. Missing facts, distorted facts, unclear facts, all contribute to confusion. "Mapping out" the facts, whether in a chart, matrix, process flow, Venn diagram, or other graphic representation, is essential.
So, take a look, and if you think one or another of Andrew's charts helps, let him know. And if you're thinking of using them beyond your own eyes, ask him permission. As an author, creator, and programmer, I can state unequivocally that he will be most appreciative. And I'm confident he'll be of help in your goals.
Here's what he has in his still-growing collection. Oh, I'm sure he'd welcome some sharing in reverse. Hey, anything that makes digging through tax transactions easier gets my vote.
Charts of Tax Cases
Reorganization Charts
I'd like to bring to your attention a very interesting and useful tax resouce on the web that should be of interest to practitioners, tax law professors, and law students. It's the Andrew Mitchel LLC - International Tax Services web site, particularly the two resouces, Charts of Tax Cases and Reorganization Charts. Andrew, who combines an LL.M. and CPA and practices in Connecticut, specializes in international tax. Of course, because one cannot dig into that area of tax without understanding basic tax, corporate tax, and some other areas, Andrew, like the rest of us, worked through a variety of corporate tax cases and the reorganization provisions. And like many of us, he chose to design visualizations of the transactions. Charts, graphs, pictures, anything that appeals to the eye can be a great help in understanding tax law. That's the case here. As many of you know, I'm a very visually-focused person. That's why creating Powerpoint slides for my courses was a snap.... I had been drawing the pictures on the blackboard. Trust me, the Powerpoint visuals are MUCH more legible.
As I tell my students, there's no point in getting into black letter law until one understands the facts. Understanding the transaction often is the chief stumbling block for a tax student, and, of course, for many tax practitioners and judges. Missing facts, distorted facts, unclear facts, all contribute to confusion. "Mapping out" the facts, whether in a chart, matrix, process flow, Venn diagram, or other graphic representation, is essential.
So, take a look, and if you think one or another of Andrew's charts helps, let him know. And if you're thinking of using them beyond your own eyes, ask him permission. As an author, creator, and programmer, I can state unequivocally that he will be most appreciative. And I'm confident he'll be of help in your goals.
Here's what he has in his still-growing collection. Oh, I'm sure he'd welcome some sharing in reverse. Hey, anything that makes digging through tax transactions easier gets my vote.
Charts of Tax Cases
- 1. Atlas Tool - (D reorganization with boot)
- 2. Bhada - (Inversion via 351)
- 3. Chapman - (B reorganization)
- 4. Court Holding - (Conduit Seller)
- 5. Davant - (D reorganization with Strawman)
- 6. Davis - (section 302 - redemption of preferred stock)
- 7. Esmark - (Tender offer followed by in-kind redemption)
- 8. Gregory v. Helvering - (Seminal Case on Form vs. Substance)
- 9. Intermountain Lumber (Busted 351 exchange)
- 10. King Enterprises - (Two-step Merger)
- 11. Morris Trust - (Spin-off followed by merger of Distributing)
- 12. Plantation Patterns - (Guarantor of debt treated as borrower)
- 13. Smothers - (Liquidation-reincorporation)
- 14. TSN Liquidating - (Pre-sale distribution)
- 15. Waterman Steamship - (Pre-sale distribution)
- 16. Yoc Heating - (pre-section 338 QSP followed by failed reorganization)
- 17. Zenz v. Quinlivan - (Part sale / part redemption)
- 18. Rev. Rul. 67-274 - (Purported B reorg plus Target liquidation is a C reorg)
- 2. Bhada - (Inversion via 351)
Reorganization Charts
- 1. A Reorganization
- 2. B Reorganization
- 3. C Reorganization
- 4. D Reorganization (acquisitive - i.e., not a 355 type transaction)
- 5. A Reorganization with a drop-down
- 6. B Reorganization with a drop-down
- 7. C Reorganization with a drop-down
- 8. D Reorganization with a drop-down
- 9. Forward Triangular Merger
- 2. B Reorganization
Saturday, June 25, 2005
Taxes, Fashion Sense, and the Internet
Perhaps this is one of the great contributions of the internet to culture. Someone has an idea, and it can be shared with the world in the blink of an eye.
Take a look at this merchandising site. Click on any one of the apparel items and then click on the "Click to enlarge" link so that you can read what it says.
Then think.....
Someone came up with the idea.
Someone manufactures the items.
People are buying the items.
People are wearing the items.
It's all the talk of the ABA-TAX listserve, and it's just been posted to the tax law professors' list. It's spreading faster than bad tax legislation.
Understand, I have, so I am told, no fashion sense. I manage to remember that I am a "winter" and should stick with jewel tone colors. That's why you see me (if you see me) in plain black, navy blue, and the like.
Yet even I know that wearing one of these to a party isn't going to trigger conversation with folks suddenly curious about the tax adventures of a blogging law professor, or the fashion mishaps of a tax blogger. I have a feeling that there is ONE of these items in existence that says on the back "I INVENTED THIS" and that is the direction in which all the folks at the party will head for invigorating conversations. Entrepreneurs... they'll do it every time.
OK, so I'm annoyed I didn't come up with the idea. Even if I had, I don't think I'd be wearing it. Unless, of course, someone paid me $500,000. On principles of fashion, I can compromise. For $500,000. Sure.
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Take a look at this merchandising site. Click on any one of the apparel items and then click on the "Click to enlarge" link so that you can read what it says.
Then think.....
Someone came up with the idea.
Someone manufactures the items.
People are buying the items.
People are wearing the items.
It's all the talk of the ABA-TAX listserve, and it's just been posted to the tax law professors' list. It's spreading faster than bad tax legislation.
Understand, I have, so I am told, no fashion sense. I manage to remember that I am a "winter" and should stick with jewel tone colors. That's why you see me (if you see me) in plain black, navy blue, and the like.
Yet even I know that wearing one of these to a party isn't going to trigger conversation with folks suddenly curious about the tax adventures of a blogging law professor, or the fashion mishaps of a tax blogger. I have a feeling that there is ONE of these items in existence that says on the back "I INVENTED THIS" and that is the direction in which all the folks at the party will head for invigorating conversations. Entrepreneurs... they'll do it every time.
OK, so I'm annoyed I didn't come up with the idea. Even if I had, I don't think I'd be wearing it. Unless, of course, someone paid me $500,000. On principles of fashion, I can compromise. For $500,000. Sure.
