Paul L. Caron
Dean
Pepperdine Caruso
School of Law
Tax News
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Three Intersections of Taxpayer Privacy and the IRS
In a system predicated on voluntary compliance, taxpayer privacy is an evergreen concern. But in recent weeks, three disparate events have raised questions about the security of taxpayer data—and what information the government should collect through the tax system. What are these events? First, the Treasury Inspector General for Tax Administration’s report on IRS employees’…
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WSJ on Mortgage Rates (and Tax Savings) with the Bank of Mom and Dad
In the Wall Street Journal, Laura Saunders refreshes well-traveled techniques for intergenerational wealth transfers beyond the ultrawealthy. Many of these involve helping younger generations buy homes. Saunders’ advice is timely, as conventional home mortgage rates hit a three-year high. (October’s AFR isn’t exactly channelling the Obama years, either, but gifts and itemized deductions may reduce…
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Bloomberg: Ireland Plans More Changes to R&D Tax Credit, IP Incentives
Bloomberg (Ryan Hogg), Ireland Plans More Changes to R&D Tax Credit, IP Incentives: Ireland plans to expand its research and development tax credit and extend refunds on intellectual property profits as part of its upcoming budget presented Tuesday. Tanaiste and Finance Minister Simon Harris also announced changes to withholding taxes and promised the implementation of…
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Section 351 Exchanges and ETFs
In Matt Levine’s Money Stuff newsletter from September 29, he highlights IRS Rev. Rul. 2026-20, which targets the use of section 351 in the context of exchange traded funds (ETFs). Here’s how Levine describes the so-called “heartbeat” transactions: The reason this works is that ETFs qualify as regulated investment companies, and as such, under section…
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Graetz on the New IRS Regulations to Revoke Tax-Exempt Status
Michael Graetz has a new piece on the proposed IRS regulations, “A Presidential Assault on Pluralistic Democracy: The IRS’s Attack on Private Schools” (Tax Notes, Sept. 18, 2026). I believe the full text is not behind a paywall. Here’s how it starts: On September 4 the IRS published proposed regulations (REG-119986-25) that, if finalized, would…
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Wilbur Ross, Steve Wynn Sue Over New York Pied-a-Terre Tax
Chris Dolmetsch & Laura Nahmias (Bloomberg Law): Wilbur Ross, Steve Wynn Sue Over New York Pied-a-Terre Tax Former US Commerce Secretary Wilbur Ross and casino tycoon Steve Wynn filed a lawsuit challenging New York’s pied-à-terre tax, saying that it’s unconstitutional because it only targets people who live outside the city.
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IRS Revokes 71 Pieces of Tax Guidance; Tax Pros Wrangle With Treasury Rule Authority Post-Loper Bright
Bloomberg Law, IRS Revokes 71 Pieces of Tax Guidance, Calling Them Obsolete: The IRS revoked 71 pieces of guidance that it says are obsolete as part of President Donald Trump’s push for deregulation. The revoked revenue rulings, revenue procedures, notices, and other documents “no longer provide useful information,” the IRS said in a notice Tuesday…
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Treasury Follows Through on “Too Good to Be True” ETF Tax Strategies
In July, Treasury officials warned that they were scrutinizing a burgeoning category of tax-aware investment strategies. At the time, Treasury stopped short of issuing guidance. Well, the agency now has taken the “first concrete steps” to curtail these novel financial products. At the end of September, Treasury and the IRS released Notice 2026-62, a broad…
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WSJ: Hedge-Fund Managers Lose Out on Lucrative Tax Strategy
After the Second Circuit’s decision in Soroban and the Fifth Circuit’s substituted opinion in Sirius Solutions, the limited partner exception for self-employment taxes is narrower. With the First Circuit’s decision in Denham Capital Management still to come, the odds of a Supreme Court ruling on the issue are lower. While there’s some doctrinal gap between…
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Bloomberg: OECD Publishes Fresh Model Tax Convention After 2025 Updates
Bloomberg (Ryan Hogg), OECD Publishes Fresh Model Tax Convention After 2025 Updates:
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Evaluating Treasury’s Proposed Nondiscrimination Regs
Marie Sapirie has a new piece on the regs in Tax Notes, “Evaluating the Proposed Nondiscrimination Regs Under Bob Jones” (Sept. 28, 2026): The writing has been on the wall — or rather on Truth Social — for some time, but the IRS and Treasury finally released proposed regulations (REG-119986-25) on racial nondiscrimination in private…
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Jay Leno Hails California Crackdown on Supercar Tax Avoiders
Alicia Clanton & Hannah Elliott (Bloomberg Law): Jay Leno Hails California Crackdown on Supercar Tax Avoiders Jay Leno has amassed a legendary car collection and lent his name to a recent California law easing smog-check rules for some classics. But there’s one break for wealthy car owners he has little sympathy for: Montana license plates.…
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Justice Department Sides With Churches In Political Speech/Tax-Exempt Status Case
Bloomberg Law, Justice Department Sides With Churches in Political Speech Case: The Justice Department told an appeals court it largely agrees with the religious groups suing it over how far churches can wade into politics and still keep their tax-exempt status. The DOJ said a lower court judge was wrong to throw out an agreement…
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WSJ: The IRS Is Cracking Down on a Favorite Way the Ultrawealthy Pass On Money
Grantor retained annuity trusts (GRATs) are a longstanding staple of high-end estate planning. The basic structure is well-traveled: a grantor transfers appreciating assets to an irrevocable trust, retains an annuity for a fixed term, and—if the assets outperform the rate on the annuity—shifts excess appreciation to beneficiaries with comparatively little gift-tax cost. In the Wall…
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Bloomberg: Tax Group Calls Economic Substance Doctrine a Dangerous Tool
Bloomberg (James Matheson), Tax Group Calls Economic Substance Doctrine a ‘Dangerous Tool Courts must first determine the economic substance doctrine’s relevance to a transaction before the IRS can raise a challenge under it, a nonprofit taxpayer advocacy organization told the Fifth Circuit, warning of the government’s current “regulation by litigation” approach. The National Taxpayers Union…
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The American Tax Policy Institute and the ABA Tax Section: NIL Taxation Seminars
Katie Pratt (Loyola Law School), Erin Henry (Arkansas), and Caroline Bruckner (American University) co-organized two seminars on the taxation of NIL Income co-sponsored with the American Tax Policy Institute and the ABA Tax Section:
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Second Circuit Affirms Tax Court’s Judgment in Soroban
In previous posts, I have highlighted the ongoing litigation over the term “limited partner,” as defined in section 1402(a)(13) (the so-called “limited partner exception”). The Fifth Circuit, in its decision last month in K Alain, LLLP v. Commissioner, held that “the ordinary public meaning of [the] phrase [“limited partner”] is a partner who plays no…
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Nobel Laureates’ Support Letter for California Billionaire Tax
Daron Acemoglu (MIT), Abhijit Banerjee (University of Zurich and MIT), Peter Diamond (MIT), Esther Duflo (University of Zurich and MIT), Paul Krugman (CUNY), and Joseph Stiglitz (Columbia University), “Economics Nobel Laureates Support letter for Proposition 40, the California billionaire tax” (September 19, 2026): In November 2026, California will vote on Proposition 40, a 5% one-time…
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Maryland Appeals Google, Apple, Peacock’s Take Down of Ad Tax
Perry Cooper (Bloomberg Law): Maryland Appeals Google, Apple, Peacock’s Take Down of Ad Tax Maryland asked a state trial court in documents obtained by Bloomberg Law Monday to unwind rulings striking down its first-in-the-nation tax on digital advertising challenged by Google LLC, Peacock TV LLC, and Apple Inc. The Maryland Tax Court held in August…
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Republican Floats Package to Deter DSTs, Boost Foreign Credits
Chris Cioffi & Lauren Vella (Bloomberg Law): Republican Floats Package to Deter DSTs, Boost Foreign Credits A key Republican tax writer is floating a new package of international tax proposals that includes a tool to blunt digital services taxes — a longstanding target of criticism by the Trump administration and lawmakers on both sides of…
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WSJ: Why I’m Trying to Stop the IRS From Giving Me a Tax Refund This Year
Laura Saunders (WSJ): Why I’m Trying to Stop the IRS From Giving Me a Tax Refund This Year It is time to start year-end tax planning, and this year I’m doing something different. For the first time, I’m planning to owe taxes next April 15 instead of getting a refund.
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Teenage Law Grad Thinks Getting A Tax LLM at Northwestern Will Be A ‘Little Vacation’
Above the Law, Teenage Law Grad Thinks Getting A Tax LLM Will Be A ‘Little Vacation’His idea of rest and relaxation involves the Internal Revenue Code. I think it’ll be fun. I like tax, so I think it’s going to be like a little vacation. Daily Northwestern, 18-Year-Old Prodigy Jimmy Chilimigras Attends Pritzker for Specialized…
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Is the AI Boom Hollowing Out Corporate Tax Receipts?
In September 2026, the Congressional Budget Office reported a 25% year-over-year decline in corporate tax receipts, based on the first eleven months of the 2026 federal fiscal year. The absolute eleven-month decline was $96 billion—from $390 billion in FY 2025 to $294 billion in FY 2026—and comes on top of a 15% annual decline from…
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Utah Takes Montana License Plate Fight to 80,000 Vehicle Owners
Michael Bologna (Bloomberg Law): Utah Takes Montana License Plate Fight to 80,000 Vehicle Owners At least 10 states — including Illinois, Maryland, and Minnesota — have adopted laws or enforcement initiatives in the past year targeting residents who register their cars, trucks, boats, and aircraft through Montana limited liability companies. California has leveled criminal tax…
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A Retro Tax Reconstruction of Trump’s $5,000 Dividend
September’s two-day Republican midterm convention may not have moved the needle among voters, but it did yield an interesting (and incredibly expensive) policy proposal from President Trump. “It will be called the Trump dividend,” said the President, as he floated a $5,000 government payout for all adult Americans, if Republicans retain control of both houses…