Sunday, May 30, 2004

Richard Gershon (Dean, Charleston) has published Teaching Federal Income Taxation Using Socioeconomics, 41 San Diego L. Rev. 401 (2004). Here is the Introduction:

I have very fond memories of sitting around the dining room table at my mother’s house in Atlanta, Georgia, and enjoying Shabbat dinner. My older brother had recently become a physician, much to the delight of my father, who was also a doctor. The two of them would eagerly discuss everything from the development of new medical techniques to the business of their profession. It was in these discussions that I had my first introduction to the applications of socioeconomic theory to tax law. I remember my brother saying that he was going to spend money on something he did not need so that he could take a deduction. Economically, he would have been better off keeping his money and paying his taxes, but his reason for making his decision was that he “did not want the government to have the money.”

Clearly, my brother’s behavior could not have been predicted merely by assessing what was in his best economic interest. Instead, his actions reflected his own beliefs and expectations regarding the nature of the federal tax system. This, in many respects, is a classic example of why it is important to incorporate socioeconomics into the teaching of federal income taxation. Students need to understand that the study of tax is not a study of pure economics, but instead involves many factors. Understanding those factors can better help them to read and apply the Internal Revenue Code (Code) and the Treasury regulations interpreting it. Accordingly, this Article gives examples for using socioeconomic theory to teach taxation.