Vol. 30 No. 3 - Spring 2011

What If Uncle Jim Is Under Audit or Your Client Wants to Give You a Porsche? Ethical Issues When There Is a Personal Connection with a Client

Lance E. Rothenberg

When a client, or prospective client, seeks legal advice, a lawyer is expected to provide candid, objective, and competent assistance. In providing that assistance, a lawyer wears several hats, which can include: advocate, counselor, problem solver, officer of the court, spokesperson, negotiator, defender, and, perhaps, even hired gun. While each engagement is unique and raises its own issues, a practitioner must always be mindful of, and guided by, ethical and professional considerations. ...

From the Chair

Charles H. Egerton

My column for this edition of the NewsQuarterly will address two important but unrelated topics. Each year, the incomingChair of the Tax Section holds a leadership retreat with the Section’s officers, Council members, and staff to set priorities for the coming year. One of the top priorities that we agreed upon at our retreat last summer was the need to increase the Tax Section’s visibility and participation in the tax legislative process. ...

2011-2012 Nominees

In accordance with Sections 6.1 and 6.3 of the Section of Taxation Bylaws, the following nominations have been submitted by the Nominating Committee for terms beginning at the conclusion of the 2011 Annual Meeting in August. Under the Section Bylaws, the current Chair-Elect, William M. Paul of Washington, DC, becomes Chair of the Section at the close of the Annual Meeting. ...

Letter to the Editor: February 15, 2011

Chairs and Vice Chairs of the Committee on Partnerships and LLCs and the Committee on Real Estate

The undersigned are current and former Chairs and Vice Chairs of the Committee on Partnerships and LLCs and the Committee on Real Estate. We write in our individual capacities to express our strong disagreement with an article entitled “What Is the Value of a ‘Should’ Opinion?” that appeared in the Winter 2011 issue of the NewsQuarterly. The article discusses the Tax Court’s decision in Canal Corporation v. Commissioner, 135 T.C. No. 9 (2010). For reasons that have been detailed elsewhere (including in various articles and at Tax Section Committee meetings), we believe that Canal Corporation was wrongly decided and that penalties should not have been applied to the taxpayer. ...

Interview: Grover Norquist, President of Americans for Tax Reform

Jasper L. Cummings, Jr.; Alan J.J. Swirski

Grover Norquist is President of the D.C.-based Americans for Tax Reform. We interviewed him eight years ago in this column. Since that time his organization has continued to strongly influence the public debate on tax reform. ...

Do Treasury and the Service Have to Explain Their Choices?

Steve R. Johnson

The validity of tax regulations has been challenged by taxpayers almost as long as there have been tax regulations. Now, however, we are in a period of unusually high activity on this front. The Supreme Court recently upheld the validity of a regulation under section 3121 in Mayo Foundation for Medical Ed. and Research v. United States, 131 S. Ct. 704 (2011); many cases are testing the validity of regulations extending the six-year statute of limitations under section 6501(e) to basis overstate-ments (or, as the Service would put it, clarifying the law in this regard); and many cases are testing the validity of regulations imposing a two-year limitations period on claims for equitable spousal relief under section 6015(f). ...

The Service Traces Clearer Definitions in the Proposed Regulations on “Publicly Traded” Debt Instruments

AJ Picchione

My law school Contracts professor took some pleasure in pointing out various lexical oddities in our material. I vividly recall his introduction of the “parol evidence rule” as the triple misnomer. “Rule” is a misnomer because it is a principle, not a rule. “Evidence” is a misnomer because it is a principle of contract law, not of evidence. “Parol” is a misnomer because it applies to written as well as oral (i.e., parol) statements. ...

Is Your Client Planning to Expatriate? Why the HEART Act May Cause a Change of Heart

Vlad Frants

On its surface, legislation known as the Heroes Earnings Assistance and Relief Tax Act of 2008 (“HEART Act”) provides a number of pay and employee benefits to military personnel. Pub. L. No. 110-245, 122 Stat. 1624. But at its core, the HEART Act significantly changes the tax system applicable to U.S. citizens and lawful permanent residents who expatriate by relinquishing, respectively, their citizenship or permanent resident status. ...

Mayo v. United States: Treasury Earns Chevron Deference

Matthew R. Sontag

Prior to 2011, the Supreme Court had not articulated a clear standard for the deference to be given to Treasury regulations by the judiciary. Because of this ambiguity, taxpayers have been permitted to challenge the validity of the regulations through tax returns, with a reporting structure implemented for the express purpose of disclosing positions taken that are contrary to regula-tory authority. ...

The Time for Tax Reform Is Now

Christopher M. Pietruszkiewicz

Our number one most serious problem and number one legislative recommendation go into the data in detail and provide a good sense of what tax complexity does to each and every one of our lives. It is not good. But if we all agree that tax reform is necessary, why hasn’t it happened? ...

“Be the Change You Wish to See in the World”

Francine J. Lipman

It was 8:35 or so on Sunday night. Mother’s Day night. I was sitting in the big brown corduroy easy chair in the comfort of my parents’ den. On the couch next to me under a historic earth-tone afghan was my mother. Even though it was mid-May in San Diego she was wearing a knit wool cap on her head. She had a drawer full of them. The colorful caps are still there. ...

The Results Are In: ABA Tax Section 2010 Member Survey

ABA Section of Taxation

From May through July 2010, the Tax Section conducted a membership survey,1 the fifth such effort since 1982. Of the 16,515 members surveyed, 1,082 responded by e-mail, and an additional 22 individuals responded by mail for a total of 1,104 returned surveys. ...

Tax: That Three Letter Four Letter Word

Robert S. Steinberg

A song about taxation.

ABA Section of Taxation CLE Calendar

A calendar of upcoming CLE opportunities.

Boxscore

Submissions and comments on government regulations, administrative rulings, ABA policy and blanket authorities.