Taft v. Bowers: The Foundation for Non-Recognition Provisions in the Income Tax
ACTEC Law Journal, Vol. 42, No. 1, 2017
6 Pages Posted: 8 Mar 2017
Date Written: March 7, 2017
Taft v. Bowers is a Supreme Court decision that is rarely studied in law schools or discussed by scholars. Yet, it is a case of vast significance. In the Taft decision, the Supreme Court confirmed that Congress may create non-recognition exceptions to the income tax that merely defer the recognition of income, rather than permanently exclude it. If the Taft case had been decided differently, it is likely that the number of non-recognition provisions in the Internal Revenue Code ("Code") would be significantly reduced.
Suggested Citation: Suggested Citation