A subcommittee of the House Ethics Committee today adopted 13 counts against former Charles Rangel (D-NY): Subcommittee Statement of Alleged Violation (41 pages) Statement of Charles Rangel in Response (32 pages) Press and blogosphere coverage: Associated Press Blog of Legal Times Bloomberg New York Daily News New York Times Politico...

The star of “Rush Hour” (and its lucrative sequels), Chris Tucker, has made headlines for something other than acting these days. According to TMZ, the actor was slapped with liens from IRS for more than $11.5 million in unpaid federal taxes. That total represents liabilities for the years 2001, 2002, 2004, 2005 and 2006. Tucker [...]

Delinquent taxpayers will get a rare opportunity to pay outstanding taxes and interest to the District of Columbia, have their penalties and fees waived, and avoid criminal prosecution. The DC Tax Amnesty program will run from August 2 through September 30, 2010, offering individuals and businesses the opportunity to satisfy their tax liabilities.

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Contributor: Kohn Shands Elbert Gianoulakis & Giljum, LLP [View: Profile | Documents]

Following up on last week's post, WSJ: Washington's Tax Oracles and Revenue Estimates (July 21, 2010): Calvin H. Johnson (Texas) has published a letter to the editor in today's Wall Street Journal, It's Hard to Predict the Future, Especially About Taxes: I think that the Journal is on to something...

Contributor: Darrin Mish, Tampa Tax Attorney [View: Profile | Documents]

The latest issue of the ABA Journal has, as its cover story, "The 25 Greatest Fictional Lawyers (Who Are Not Atticus Finch)." These are not necessarily the fictional lawyers described as being the most able, but rather the best characters who are lawyers. E.g., unclear if Ally McBeal would be on the list otherwise.

You can vote here, and I'd personally be inclined to vote for Vincent "Vinny" Gambini, from the delightful film My Cousin Vinny.

There's also a second list here of "Other Notable Characters That Did Not Fit into Our Top 25." Here we find such personal faves as Tom Hagen from The Godfather and Jackie Chiles from Seinfeld, and there's some indication that fun fictional characters end up here if they are simply too odious and dishonest. For example, Ned Racine of Body Heat is here with the comment that "he's lazy and corrupt — and we like that in a fictional character, but maybe not in a lawyer."

Especially given that last comment, I must put in a word for my own Getting It lead character, Bill Doberman. He definitely belongs on this list, if I do say so myself. OK, if there are ethical standards of any sort, then the "Other Notables" rather than the main list.

I mean, c'mon - Claire Huxtable from the Cosby Show? And on the main list, Arnie Becker from LA Law? Truly a pale shadow of Doberman though some overlap of personality types.

The only excuse the jury that selected the notables can offer for not adding Doberman - but admittedly it's airtight unless we apply a strict liability standard - is that they presumably haven't read Getting It or heard of him.

Brannon P. Denning (Cumberland), Marcia L. McCormick (St. Louis) & Jeffrey M. Lipshaw (Suffolk) have posted the Introduction and Table of Contents from their forthcoming book, Becoming a Law Professor: A Candidate's Guide (ABA, 2010), on SSRN. Here is the abstract: This is the Table of Contents and the Introduction...

Eva von Dassow, a professor of Classic and Near Eastern Studies, reacts to proposed budget cuts at the University of Minnesota: For more, see Inside Higher Ed.

Americans for Tax Reform, Gibbs Misleads Public on Obama’s Broken Tax Pledge: White House spokesman Robert Gibbs seems to have forgotten that his boss has already broken his central campaign promise – a “firm pledge” that “no family making less than $250,000 a year will see any form of tax...

Contributor: Lane Powell PC [View: Profile | Documents]

I'm seeing a lot of folks clicking on prior year blog posts about a sales tax holiday in Massachusetts, so I just wanted to make sure all y'all have the latest information. Right now, early afternoon on July 29, the Bay State does not have a sales tax holiday officially scheduled for this year. However,...

A sperm bank if California known as Free Fertility Foundation was denied tax exempt status by the Tax Court earlier this month. The nonprofit organization was formed to provide free sperm (“Sperm vials available immediately with no wait,” according to the company website) and make a “positive difference in the world” (founder’s words) so why did the IRS cut them a break?

The nonprofit founder William C. Naylor, Jr. is a software engineer, he hold more than 10 patents on various inventions. He incorporated Free Fertility Foundation, Inc. to provide sperm free of charge to woman in need. Curiously there’s only one donor listed in the catalog:

fwcn02453 – scientific researcher; mathematics and computer expert; vice-president of company; straight A student in university; chess champion in high school; awards for academic excellence and athletics while child; 6 ft 1 inch tall; Caucasian 3/4 English 1/4 Scottish. Sperm vials available immediately with no wait.

The sole sperm donor is Naylor himself, the foundation founder! But that’s not all, he continues his ultimate expression of narcissism with an extremely stringent application process. No one gets his sperm unless they are worthy, apparently. Preference is afforded to women “with better education” and “whose [family] members have a track record of contributing to their communities” (among many other restrictions and preferences). Because of this elitism 20 of the 433 applicants received sperm in 2004. In 2005, only 4 out of 386 women won the “privilege”.

So what was the Tax Court’s verdict on the sperm bank? They said one man’s sperm distributed to a small number of women doesn’t benefit the general public. Naylor made have said some nice things about “making the world a better place” (again, his real words) with his superior sperm, but the tax court is not convinced. I’ll close with their words:

While Naylor may believe that petitioner’s activities “make more of a positive difference to the world than all of the inventions and scientific discoveries that * * * [he]could ever create”, we are not convinced that the distribution of one man’s (i.e., Naylor’s) sperm to a small number of women, selected in the manner presented, promotes health or confers a public benefit.

So don't get any creative ideas on your tax deductions, guys. It didn't work for William C. Naylor, Jr. and it's not going to work for you!

Most people are familiar with the usual expenses you can get tax breaks for. For business owners, you get tax relief for business-related expenses. If you are an employee, you would probably enjoy tax deductibles like donations to charities, child relief and so on. But there is one tax break that is not very often spoken about – job search expense deductions. Especially in this shaky economy, this tax break would apply to many taxpayers and come in handy, too. If you have spent any time or effort in looking for a job this summer, you should tally up your expenses because you may be able to deduct some of these job search expenses on your next tax return.
But there are a few conditions that govern which job search related expenses are eligible for the tax break. Here are a few things you should know about deducting costs related to your job search.

More on Little-known Tax Deductible Expense

Little-known Tax Deductible Expense is a post from: IRS Tax Problem Solver Blog - IRS Help

Little-known Tax Deductible Expense is a post from: IRS Tax Problem Solver Blog - IRS Help

Lawrence C. Smith Jr. (Louisiana Tech University, Department of Economics), L. Murphy Smith (Texas A&M University, Mays Business School) & William C. Gruben (Texas A&M International University, A.R. Sanchez, Jr. School of Business) have posted A Multinational Analysis of Tax Rates and Economic Activity on SSRN. Here is the abstract:...

(July 29) -- Deb Freele was asleep in her tent when she awoke to a bear chomping on her arm. Hours after she recounted her terrifying encounter at a Montana campground near Yellowstone National Park, authorities announced the capture of the 300-plus-pound grizzly suspected in the unprovoked rampage that left one person dead and another injured.

At its most recent meeting, held in Chicago on July 19, the Financial Accounting Foundation's (FAF) Blue Ribbon Panel Chairman Rich Anderson asked the panel to define the problem that private companies faced with U.S. GAAP and the standard-setting system and to narrow the field for proposed alternative models.

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Willie was a busy taxpayer. While working full-time as a computer analyst for the City of Houston, he also had...

The American Institute of Certified Public Accountants (AICPA) has asked members of Congress to repeal the section of the new health care law that requires businesses to report to the Internal Revenue Service any purchase from a vendor of goods or services worth $600 or more during the calendar year. 

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So John Kerry is going to pay use $500,000 in Massachussetts tax on the boat he moored in Rhode Island...

Andrew Mitchell explains what a "reverse hybrid" is in "Hybrid Entities and Reverse Hybrid Entities."...

Forbes Magazine reports that George Washington was the wealthiest President. For his day, the Father of the Country was incredibly...

I can’t believe that folks are already talking about back to school… With all of the snow this year, I feel like my kids just got out of school! But my niece is reporting that she’s starting next week (early, I know) and my inbox is filled with emails from Lands End reminding me to [...]

Tax-News.com: After an Article IV consultation with China, the International Monetary Fund said that fiscal policy continued to provide important support to the Chinese economy and the withdrawal of stimulus would need “calibrating”.

Tax-News.com: The Australian Taxation Office has disclosed that it has obtained data from eBay Australia and Trading Post Australia, so as to assess the level of taxation compliance of individuals and businesses that sell goods or services online.

Tax-News.com: A UK parliamentary committee is to hold an inquiry into the business tax regime in Northern Ireland with a view to recommending how Ulster can compete more effectively with its low-tax neighbour to the south.

Tax-News.com: US President Barack Obama has used a meeting with a group of small business owners in New Jersey to urge the Senate to pass the proposed small business legislation, to strengthen those firms that, he hopes, will be able to create jobs and lead the economic recovery.

Following up on my prior posts: Tax Court Allows Driver Cited for DUI in Accident to Deduct Car Damage as Casualty Loss Because He 'Only' Blew a .09 (Dec. 11, 2009) Tax Court Lets DUI Driver Write Off Car Damage (Dec. 16, 2009) Drinking and Driving: Taxpayer Allowed to Take...

New York Daily News, What a Deal! Photographer Ansel Adams' Work Uncovered at a Yard Sale: Rick Norsigian made one of the best yard sale deals ever. Ten years ago, the California painter bought two boxes of photographic plates for $45, after he bargained the owner down from $75. Today,...

TMZ reports that actor Chris Tucker (Rush Hour) owes back taxes of $11.6 million to the IRS and $3.6 million to California, caused in part by bad real estate investments. Other celebrity tax troubles: Wes Bentley, actor (American Beauty) Dave Bing, Detroit mayor, former NBA star, $103,627 Michigan tax lien...

Tax-News.com: A 30 day 'social emergency' has been declared in 37 Colombian municipalities that border Venezuela and the country’s 16% VAT has been suspended in these areas on specified commercial transactions, in order to mitigate economic problems arising from Venezuela's decision to sever all relations with Colombia.

Forbes, The Ten Richest Presidents: Who were the nation's 10 richest presidents? Here's our best assessment taking into account a number of factors, including absolute wealth in office (some nearly went bust afterward) and, to help adjust for two centuries of both inflation and economic growth, comparative wealth within the...

Tax-News.com: Austria and Israel have initialed a revised tax treaty for the avoidance of double taxation between the two countries.

Tax-News.com: The European insurance and reinsurance federation, has suggested to the US House of Representatives that proposals to change the US tax treatment of reinsurance between affiliated entities could be in contravention of America's World Trade Organization commitments.

Tax-News.com: Presidents and high level officials from Belize, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Panama have met to adopt a 'comprehensive agenda' on regional integration.

Tax-News.com: The Jersey Financial Services Commission on July 27 published a consultation paper setting out proposals for an increase in regulatory fees for deposit-taking business.

Tax-News.com: The American Farm Bureau Federation, the Coalition of Service Industries and the National Association of Manufacturers have put forward a comprehensive approach to increase United States exports, including the negotiation of new free trade agreements.

Tax-News.com: The coalition opposition, led by the Liberal party’s Tony Abbott, has made an electoral commitment to reduce company tax in Australia from the current 30% to 28.5%, in competition with the Labor government’s existing commitment to reduce it to 29%.

Contributor: Oleksiy Bezhevets [View: Profile | Documents]

Following up on my prior posts: Sen. John Kerry Skips Town on Sails Tax (July 23, 2010) Sen. Kerry Sails Around the Tax Issue (July 27, 2010) Sen. Kerry Abandons (Tax-Dodge) Ship, Agrees to Pay $500k MA Tax on Yacht (July 28, 2010) Boston Globe op-ed, Keelhauling Kerry, by Jeff...

Contributor: Oleksiy Bezhevets [View: Profile | Documents]

Contributor: Darrin Mish, Tampa Tax Attorney [View: Profile | Documents]

The whole of Massachusetts – nay, the world – can issue a collective sigh of relief now: Yachtgate has finally come to an end. Senator John F. Kerry (D-MA) has announced that he will “voluntarily” pay $500,000 to the Massachusetts Department of Revenue for the use of his yacht. Kerry’s luxury yacht is reportedly worth [...]

Far be it from me to say anything nice about BP after the horrendous mess they created in the Gulf of Mexico. Accidents happen, but everything I've read suggests that the company had a reckless culture that made a mockery of prudent and safe practice. They appear even to have been unusual among oil companies (e.g., Exxon is said to have learned from the Valdez spill). And given the immense costs being imposed on others, one is inclined to compare BP's executives with the fools and malefactors at major financial institutions who brought about the current global recession.

But having said that ... I was struck by a story in the Washington Post (h/t to Paul Caron's Tax Prof Blog) airing complaints about the supposedly scandalous fact that BP, by deducting its $32 billion in losses from the spill, is going to save (at a 35 percent corporate rate) almost $10 billion in taxes, which the article notes is half of the amount President Obama got them to pledge to a relief fund (the supposed "extortion" in the eyes of pro-business but anti-market lunatics who apparently believe that tort-feasors should be able to impose harm without paying). Anyway, back to my main point.

Worse still, supposedly, is the fact that this might be a $10 billion "credit" for taxes that BP has already paid. That is, it will show a huge loss for the year or years when it lays out the $32 billion, and use this to get a refund of tax liabilities in prior years when it had positive taxable income.

My recent co-author Doug Shackelford is quoted near the end of the story, shedding some needed light on the subject. First he notes that only the arbitrariness of annual accounting gives rise to the apparently shocking credit for taxes already paid. If BP paid income taxes on multiple years of taxable income at the same time - as surely would be the sensible rule if not for problems of administrative convenience, steady cash flow to the government, etcetera - the same thing would happen without the specter of a horrifying "credit" and "refund." Or, if they'd made $32 billion in January through November and then lost the same amount from the oil spill in December, no one would be surprised by their reporting zero income for the year.

Second, Shackelford notes that "[t]he cost associated with the cleanup and the damage and all that -- that's just another cost of doing business from the tax perspective ... It's viewed no different from paying salaries or other costs they might incur."

This is correct. If BP really loses the $32 billion, of course the normal rule is (and should be) that it gets a deduction, including with carryovers to other taxable years if necessary. So the issue, at least on its face, is a red herring.

A separate issue is whether BP should be fined. Indeed, perhaps fined a lot - say $10 billion on top of the $32 billion of direct compensation for harm. I don't have a particular opinion on this, as I would need to know more about the adequacy of what they're paying, the incentive and deterrence issues, problems of adequately sanctioning reckless behavior, and so forth.

Suppose that BP should be fined $10 billion. Then disallowing the tax deductions happens to get it just right, but not because that happened also to be the value of the deductions.

Shortly after health care reform became law in March, a small ripple showed up in the vast tax-law ocean. Today it has become, if not a tsunami, as least a decent sized wave of opposition to new Form 1099 reporting requirements that businesses will soon face. Starting in 2012, part of the the Patient Protection...

By Chad Brubaker 

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Taxpayers in 16 states will get sales tax breaks on the purchase of various school-related purchases during certain dates in July and August, according to CCH, a Wolters Kluwer business and provider of tax, accounting, and audit information, software, and services.

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On the same day it announced a $17 billion loss for the second quarter of 2010, BP this week said that it plans to claim a $9.9 billion taxation credit from the U.S. government for costs incurred during the oil spill cleanup operation in the Gulf of Mexico. Jason Bramwell reports.

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The KPMG Foundation this week announced it has awarded a total of $470,000 in scholarships to 47 minority accounting doctoral students for the 2010-2011 academic year.

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