The Tax Benefit Rule: A Different View and a Unified Theory of Error Correction

Abstract

Most tax lawyers and accountants view the Tax Benefit Rule as a Court-created doctrine. They misunderstand. Properly understood, almost all traditional Tax Benefit Rule cases are unnecessary, as they merely apply the traditional basis mechanism.

The Supreme Court properly understood this in the famous cases of Hilsboro and Bliss Dairy.

To fully understand the Rule, one must view it in light of Tax Mitigation and Equitable Recoupment.

Keywords: Tax Benefit Rule