Vol. 66, No. 2 - Winter 2013

In Memoriam: Christine A. Brunswick

Rudolph R. Ramelli

Rarely does one person have an impact on an institution that can be clearly seen and felt. The Tax Section has clearly seen and felt the impact of Chris Brunswick on the institution. Chris passed away on February 25, 2013, after serving 27 years as the Section’s Executive Director. ...

Taxation

Origins of the Modern Income Tax, 1894–1913

Sheldon D. Pollack

The origins of the modern income tax in the United States can be traced to a minor provision included in a revenue bill enacted by Congress in October 1913 following the ratification of the Sixteenth Amendment...

Taxation

RICs and the Retail Investor: A Marriage of Convenience or Necessity?

Stephen D. Fisher

Regulated investment companies (RICs) hold the overwhelming majority of dollars that the mainstream public invests in pooled investment vehicles. This fact is somewhat surprising, at least if the common criticism of the RIC as a tax-inefficient structure is accurate. ...

Taxation

Delimiting Limited Partners: Self-Employment Tax of Limited Partners

David W. Mayo & Rebecca C. Freeland

Many personal service firms are organized as state law limited partnerships, in part to take advantage of the apparent statutory exemption from self-employment taxes for “limited partners” under Code section 1402(a)(13). ...

Taxation

Federal Income Taxation of Medical Marijuana Businesses

Edward J. Roche, Jr.

Eighteen states and the District of Columbia have “legalized” the use of medical marijuana. Medical marijuana, however, remains a “controlled substance” under federal law. ...

Taxation

Breaking Up Is Hard to Do: The Sale of a Charitable Art Donation

Emily Lanza

The June 2009 announcement by Brandeis University’s President that the University intended to sell the entire Rose Art Museum collection triggered an emotional and highly publicized fight to determine the rightful home of 7,000 pieces of art. ...

Taxation

The Façade of Valuation: Why the Whitehouse Hotel Ltd. Partnership v. Commissioner Façade Easement Valuation Method Is Not Working

Stephanie S. Jeane

In Whitehouse Hotel Ltd. Partnership v. Commissioner, the Tax Court determined the taxpayer was entitled to a deduction for a qualified conservation contribution for its donation of a façade easement under section 170(h) of the Code. ...

Taxation

Public Policy and Petter v. Commissioner: The Potential for Abuse with Formula Allocation Clauses

Daniel A. Perez

Petter v. Commissioner, decided August of 2011, was one of the final nails in the coffin of the Service’s decades-long, public-policy-based argument against the use of valuation clauses in estate planning gift transactions. ...

Taxation

The Seventh Circuit Addresses the Application of Section 291(a)(3) to S Corporation and QSub Banks: Vainisi v. Commissioner

Katherine Thompson

Approximately 30% of banks in the United States that are insured by the Federal Deposit Insurance Company have elected to organize as S corporations rather than as C corporations. ...