Tax Law - Revision history

Eric Rasmusen: /* The Anti-Injunction Act */

2023-12-29T16:22:08Z

‎The Anti-Injunction Act

Rasmusen p1vaim: /* Miscellaneous */

2021-05-18T14:59:55Z

‎Miscellaneous

Rasmusen p1vaim: /* The Anti-Injunction Act */

2021-05-18T14:54:55Z

‎The Anti-Injunction Act

Rasmusen p1vaim: /* The Anti-Injunction Act */

2021-05-18T14:47:09Z

‎The Anti-Injunction Act

Rasmusen p1vaim at 14:05, 18 May 2021

2021-05-18T14:05:15Z

Rasmusen p1vaim at 14:27, 1 October 2020

2020-10-01T14:27:32Z

Rasmusen p1vaim at 14:23, 1 October 2020

2020-10-01T14:23:49Z

Rasmusen p1vaim at 18:21, 30 September 2020

2020-09-30T18:21:56Z

Rasmusen p1vaim at 18:20, 30 September 2020

2020-09-30T18:20:42Z

Rasmusen p1vaim: Created page with "---- The US IRS has "private letter rulings" and Luxemburg gave advice on how to run business through Luxemburg to save on taxes. Luxemburg was acting much like a shady ta..."

2020-09-30T18:20:28Z

Created page with "---- The US IRS has "private letter rulings" and Luxemburg gave advice on how to run business through Luxemburg to save on taxes. Luxemburg was acting much like a shady ta..."

New page

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The US IRS has "private letter rulings" and Luxemburg gave advice on how to run business through Luxemburg to save on taxes.

Luxemburg was acting much like a shady tax-shelter law firm, giving strategic advice to clients in the hopes of getting some profitable business. (As with such firms, it can be hard for the client to know whether shelter is legitimate or crooked, though that is crucial to the moral situation for both law firm and client.) And Luxemburg can, and maybe has, replicated the situation by having a private law firm issue the same sort of advice, subsidized by the State if necessary.

I haven't read any US private letter rulings. Do they have the approach of "Well, the scheme you suggest wouldn't reduce your taxable income plus we'd fine you if you did it, but you didn't see how you can manage to reduce your taxes a different way by doing..."? It sounds like that is the spirit of the Luxemburg letters.

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← Older revision		Revision as of 16:22, 29 December 2023
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		+	==When Is Your Charitable Contribution Dated, for Tax Year Purposes?==
		+	The Mailbox Rule of contracts, logically enough. See [https://www.adlercolvin.com/determining-the-date-of-a-charitable-gift/ Adler and Covins's] good explanation.
		+
	==The Anti-Injunction Act==		==The Anti-Injunction Act==
	What a mess! It seems that in the 2015 Direct Marketing case, the Supreme Court said that courts can issue an injunction against a reporting requirement rule so long as its violation is punished only by a criminal penalty, not a tax penalty, because the AIA in prohibiting injunctions for "assessment or collection" of taxes really only applies if the injunction would prevent collection of revenue in the particular case at hand. And now CIC services in 2021 is repeating that.		What a mess! It seems that in the 2015 Direct Marketing case, the Supreme Court said that courts can issue an injunction against a reporting requirement rule so long as its violation is punished only by a criminal penalty, not a tax penalty, because the AIA in prohibiting injunctions for "assessment or collection" of taxes really only applies if the injunction would prevent collection of revenue in the particular case at hand. And now CIC services in 2021 is repeating that.

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 ==Miscellaneous==

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 The Court's logic is crazy. Suppose I sue for an injunction against the rule that says it is criminal to willfully lie about  my income on my tax form, claiming it violates free speech or some other silly argument. Suppose I am careful NOT to plead for an injunction against the *tax* penalty for lying on my tax form; I even say I have no objection to that, in my Complaint. As I understand it (am I wrong?) the Supreme Court says the Anti-Injunction Act does not bar my suit, because  my  injunction would only bar a particular reporting provision, and would have no direct impact on tax collection.
-The Supreme Court's rule  seems to hinge on whether the IRS labels a violation penalty as a  fine or as an extra tax.  If the IRS labels a  10%  penalty for not reporting my gambling income as a   fine, the Anti-Injunction Act doesn't apply; if the IRS labels the exact same penalty as a tax, then it does apply.
+The Supreme Court's rule  seems to hinge on whether the IRS labels a violation penalty as a  fine or as an extra tax.  If the IRS labels a  10%  penalty for not reporting my gambling income as a   fine, the Anti-Injunction Act doesn't apply; if the IRS labels the exact same penalty as a tax, then it does apply. But that, apparently, is longstanding Court holding, at least when it is Congress that does the labelling. Cavanaugh's concurrence says:
-Or, maybe the court is saying that *no* reporting requirement suit is barred under the Anti-Injunction Act. Suppose I want to challenge the rule requiring me to file a tax return as being a requirement to incriminate myself. Does the Anti-Injunction Act bar that? It totally prevents the collection of a tax, but only indirectly, via reporting.
+Or, maybe the court is saying that *no* reporting requirement suit is barred under the Anti-Injunction Act. Suppose I want to challenge the rule requiring me to file a tax return as being a requirement to incriminate myself. Does the Anti-Injunction Act bar that? It totally prevents the collection of a tax, but only indirectly, via reporting.   The Supreme Court says in CIC Services that this suit would *not* be barred! Crazy. Cavanaugh tries to clarify the Court's reasoning, and succeeds, I think, but brings out its craziness:

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 ==The Anti-Injunction Act==
 What a mess! It seems that in the 2015 Direct Marketing case, the Supreme Court said that courts can issue an injunction against a reporting requirement rule so long as its violation is punished only by a criminal penalty, not a tax penalty, because the AIA in prohibiting injunctions for "assessment or collection" of taxes really only applies if the injunction would prevent collection of revenue in the particular case at hand.  And now CIC services in 2021 is repeating that.
-But that logic is crazy. Suppose I sue for an injunction against the rule that says it is criminal to willfully lie about  my income on my tax form, claiming it violates free speech or some other silly argument. Suppose I am careful NOT to plead for an injunction against the *tax* penalty for lying on my tax form; I even say I have no objection to that, in my Complaint. As I understand it (am I wrong?) the Supreme Court says the Anti-Injunction Act does not bar my suit, because  my  injunction would only bar a particular reporting provision, and would have no direct impact on tax collection.
+  The suit contests, and seeks relief from, a
-The Supreme Court's rule  seems to hinge on whether the IRS labels a violation penalty as a  fine or as an extra tax.  If the IRS labels a  10%  penalty for not reporting my gambling income as a   fine, the Anti-Injunction Act doesn't apply; if the IRS labels the exact same penalty as a tax, then it does apply.
+For tax collection case, though:
+The Court's logic is crazy. Suppose I sue for an injunction against the rule that says it is criminal to willfully lie about  my income on my tax form, claiming it violates free speech or some other silly argument. Suppose I am careful NOT to plead for an injunction against the *tax* penalty for lying on my tax form; I even say I have no objection to that, in my Complaint. As I understand it (am I wrong?) the Supreme Court says the Anti-Injunction Act does not bar my suit, because  my  injunction would only bar a particular reporting provision, and would have no direct impact on tax collection.
 ==Miscellaneous==

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+==The Anti-Injunction Act==
 Dan Shaviro ha[http://danshaviro.blogspot.com/2020/09/tax-policy-colloquium-week-6-leandra.html s a blog entry] on Leandra Lederman's paper.
 The US IRS has "private letter rulings" and Luxemburg gave advice on how to run business through Luxemburg to save on taxes.

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 Original issue discount bonds are bonds issued at below par with no interest. I might pay $900  in 2020 for a bond which would be redeemed for $1,000 in 2022, for example. Under US tax rules, though, I would be taxed as 2020 income for the part of the interest which they calculate somehow had accrued in 2020. The income in 2022 is NOT treated as capital gains.
-    If individuals use cash accounting, though, they are not taxed on interest until it is received. My reading of this is that if Smith gives Jones $900 in 2020 for repayment of $1,000 in 2022, this is not treated as an original issue discount bond. I didn't look carefully enough to get this exact, though. It seems also that if Jones does not repay in 2022,  Smith is not taxed on the income he is legally due, if he uses cash accounting--- he is taxed only when he actually receives the money.  If Smith uses accrual accounting, though,  he would be taxed on $100 income in 2022 even if Jones paid late, though he would not pay any additional tax if Jones finally paid him the $1,000 in 2025. Under either kind of accounting, if Jones never paid, Smith could at some point declare the the $1,000 a bad debt and deduct it, though there may be some limitation on deduction if lending is not Smith's ordinary business.
+If individuals use cash accounting, though, they are not taxed on interest until it is received. My reading of this is that if Smith gives Jones $900 in 2020 for repayment of $1,000 in 2022, this is not treated as an original issue discount bond. I didn't look carefully enough to get this exact, though. It seems also that if Jones does not repay in 2022,  Smith is not taxed on the income he is legally due, if he uses cash accounting--- he is taxed only when he actually receives the money.  If Smith uses accrual accounting, though,  he would be taxed on $100 income in 2022 even if Jones paid late, though he would not pay any additional tax if Jones finally paid him the $1,000 in 2025. Under either kind of accounting, if Jones never paid, Smith could at some point declare the the $1,000 a bad debt and deduct it, though there may be some limitation on deduction if lending is not Smith's ordinary business.
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← Older revision		Revision as of 14:23, 1 October 2020
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	I haven't read any US private letter rulings. Do they have the approach of "Well, the scheme you suggest wouldn't reduce your taxable income plus we'd fine you if you did it, but you didn't see how you can manage to reduce your taxes a different way by doing..."? It sounds like that is the spirit of the Luxemburg letters.		I haven't read any US private letter rulings. Do they have the approach of "Well, the scheme you suggest wouldn't reduce your taxable income plus we'd fine you if you did it, but you didn't see how you can manage to reduce your taxes a different way by doing..."? It sounds like that is the spirit of the Luxemburg letters.
		+
		+	----
		+
		+	Original issue discount bonds are bonds issued at below par with no interest. I might pay $900 in 2020 for a bond which would be redeemed for $1,000 in 2022, for example. Under US tax rules, though, I would be taxed as 2020 income for the part of the interest which they calculate somehow had accrued in 2020. The income in 2022 is NOT treated as capital gains.
		+
		+	If individuals use cash accounting, though, they are not taxed on interest until it is received. My reading of this is that if Smith gives Jones $900 in 2020 for repayment of $1,000 in 2022, this is not treated as an original issue discount bond. I didn't look carefully enough to get this exact, though. It seems also that if Jones does not repay in 2022, Smith is not taxed on the income he is legally due, if he uses cash accounting--- he is taxed only when he actually receives the money. If Smith uses accrual accounting, though, he would be taxed on $100 income in 2022 even if Jones paid late, though he would not pay any additional tax if Jones finally paid him the $1,000 in 2025. Under either kind of accounting, if Jones never paid, Smith could at some point declare the the $1,000 a bad debt and deduct it, though there may be some limitation on deduction if lending is not Smith's ordinary business.
		+
		+

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← Older revision		Revision as of 18:21, 30 September 2020
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	----		----
		+	Dan Shaviro ha[http://danshaviro.blogspot.com/2020/09/tax-policy-colloquium-week-6-leandra.html s a blog entry] on Leandra Lederman's paper.
	The US IRS has "private letter rulings" and Luxemburg gave advice on how to run business through Luxemburg to save on taxes.		The US IRS has "private letter rulings" and Luxemburg gave advice on how to run business through Luxemburg to save on taxes.