• Selected
• Entire List

Abstract:
The Act of State doctrine generally dictates that American courts not sit in judgment with respect to the acts of a foreign sovereign on its own soil. Courts commonly reason that although nothing in our Constitution requires recognition of the doctrine, adherence to its mandate effectively allows the Judicial Branch to steer clear of any actual or perceived interference with the Executive Branch's conduct of foreign policy. Wholly aside from established notions of the proper separation of powers, appeal to the doctrine is also a generous display of international comity, allowing domestic courts to defer to the sovereign authority of a foreign power. Courts hearing domestic tax disputes involving foreign expropriation losses routinely appeal to the Act of State doctrine in refusing to characterize the loss as a theft. In this Article, I question whether a court appealing to the Act of State doctrine to reach one conclusion is obligated (even if only for the sake of analytical consistency) to defer to or recognize the executive, legislative, and judicial acts of that state (or the acts of other branches) in reaching related conclusions, consistent with established tripartite articulations of the Act of State doctrine. In arguing against a deconstructionist paradigm, I reason that a monolithic mindset enhances administrability, effectively polices judicial whim, and minimizes the potential for taxpayer whipsawing.

Act of State, Foreign Expropriation, Section 165, Theft, Comity, Loss Deductions

Abstract:
In light of the federal government's plenary collection powers, the states have, for several years, sought and, with the help of Congress, managed to secure the assistance of the United States in obtaining various forms of revenue. As early as 1975, Congress authorized the Department of the Treasury to collect past-due, child-support payments in the same manner in which it assessed and collected certain federal taxes under emergency or exigent circumstances (i.e., jeopardy assessment/collection). Because such collection procedures were often considered cumbersome and costly, however, Congress soon authorized the direct seizure of pending income tax refunds as a more efficient means of reaching the assets of deadbeat dads (or the occasional deadbeat mom). The result has been a smashing success. Child-support-related refund seizures have resulted in the collection of billions of dollars of revenue. In fiscal year 2004 alone, child-support offsets totaled $1.49 billion, and in 2003, the Treasury offset almost 24 million advance child-tax-credit payments, resulting in the collection of $14.2 billion. Given the success of this approach to revenue collection, its rapid deployment to other areas should come as no surprise. In the Deficit Reduction Act of 1984 (DEFRA), Congress authorized the seizure of amounts due to federal agencies (e.g., student loan default amounts or overpayments of Old Age, Survivors, and Disability Insurance (OASDI or Social Security)). And more recently, in 1998, Congress authorized federal refund seizures to pay outstanding state income tax liabilities.

In this Article, I argue that despite various protective measures, procedural improvements are needed to minimize or eradicate erroneous refund-based property deprivations as an initial matter, especially with respect to nonobligated spouses. I proceed to argue, based largely on an intratextualist reading of the Constitution's major tax provisions, that regardless of whatever procedural safeguards exist or happen to be put in place, refund seizures, as a class, are unjustified as a matter of substantive due process because both the Sixteenth Amendment and Article I, section 8 of the Constitution expressly limit Congress's income taxing powers. Federal courts have had no recent opportunity to address substantive due process issues because the governing statute itself serves as a bar to jurisdiction.

Child Support, Student Loan Debt, Disability Overpayment, Social Security Overpayment, Tax Refund, Refund Seizure, Federal Income Tax Refund, Procedural Due Process, Substantive Due Process, Section 6402, Section 6305, Intratextualism

Abstract:
The privatization of Social Security could have promised profound challenges to the investor control doctrine (given the level of investor discretion anticipated). Revenue Ruling 2003-91 handily eliminates the apparently imminent conflict between longstanding, IRS-asserted doctrine and the demands of the political arena. One could argue that the pronouncement reflects little more than doctrinal evolution, but such evolution is a giant leap away from the twenty-two-year-old notion that investor discretion should be minimal and appears to be a doctrinal accommodation of potential Social Security privatization. This Article argues that the investor control doctrine should be dismissed. I further propose that investor discretion should be allowed with respect to the investment of contract assets, subject to (1) investment professional guidance or risk assessment, (2) age-sensitive adjustments with respect to the percentage of contract assets subject to investor discretion, and (3) limits with respect to the aggregate amount a taxpayer may invest in variable life insurance or variable annuity contracts.

Investor Control, Social Security Privatization, Annuity, Variable Annuity, Privatization, Rev. Rul. 2003-91, Vertical Equity

Abstract:
Currently, there exists a split in the U.S. Courts of Appeals with respect to whether certain amounts paid to university professors relinquishing tenure and retiring early constitute "wages" with respect to "employment." This Article addresses that split before exploring, more broadly, the troubled concepts of "wages" and "employment." Though some courts have struggled to draw discernable lines of demarcation to separate "wages" from "income" and the income tax conception of "wages" from the payroll tax conception, other courts, apparently yielding to expansive conceptual pressures and the visceral tug of the existence of the employer/employee relationship, have pursued regressive taxes from low- and mid-wage earners by embracing tangential precedent, importing broad conceptions of "wages" and "employment," and looking to shifting administrative interpretations for guidance. And yet, at the same time that Congress, certain courts, and administrative agencies have undertaken to sniff out the merest trace of low- and mid-wage earner revenue (lest the serfs take tax holiday), certain entities/individuals in the "capital-gain" Mecca of private equity have managed, in breathtaking defiance of longstanding tax principles, to survive a degree of scrutiny despite raking in billions of dollars as compensation for services rendered. Having presented commentary on this contrast, the Article turns to the impending Social Security crisis and presents rational alternatives to the enhancement of systemic inequities which would result from raising payroll tax rates, sharply increasing the FICA Wage Base, or reducing benefit levels for those who have, quite literally, earned the right to retire with financial dignity.

Tax, FICA, Wages, Employment, Regressive Taxes, Regressivity, Private Equity, Social Security, FICA Wage Base, Social Security Trust Fund, Federal Budget Deficit, Vertical Equity, Baby Boomer

Abstract:
Prior to January of 1994, institutions of higher education could appeal to an exemption in the Age Discrimination in Employment Act of 1967 to force the retirement of tenured faculty members who had attained the age of seventy. With the expiration of that exemption, tenured faculty members may now retire well after that age, and for various personal and professional reasons, the postponement phenomenon is widespread. Despite the considerable appeal of a tenure buyout system, there is a real question as to whether buyout payments are subject to payroll taxes as “wages” with respect to “employment;” U.S. Courts of Appeals have split on the issue. This Article highlights the fact that expanding or narrowing the ambit of payroll tax “wages” has far-reaching impact, given that payroll tax revenues fund not only Social Security and Medicare programs but also general government expenditures. In addition to arguing that burgeoning entitlement program needs and virtually chronic federal budget woes have exerted expansive pressure on the “wages” concept, the Article contends that the position adopted by the Third Circuit in University of Pittsburgh v. United States represents judicial overreach because the court imported a definitional standard from the world of the Social Security Act into the tax arena despite clear and wise exhortation, per United States v. Cleveland Indians Baseball Co., not to indulge that tendency. Given the modest attention payroll tax policy gets on the political stage, the historical academic focus on progressive tax policy, and the ease of silent piggybacking on the employer-employee relationship, the payroll tax machinery is capable of truly admirable stealth, which can, in fact, pay off handsomely in the form of substantial revenue from low- and mid-wage earners.

tenure, buyout, wages, social security, medicare, higher education, retirement, ADEA, payroll taxes, employment, Social Security Act, regressive taxes