Hester Prynne, Lydia Bennet, and Section 306 Stock: The Concept of Tainting in the American Novel, the British Novel, and the Internal Revenue Code

Did Nathaniel Hawthorne\u27s novel, The Scarlet Letter, inspire Section 306 of the Internal Revenue Code? This code provision adopts a peculiarly Hawthorne-like solution to a tax avoidance scheme known as the preferred stock bailout. Section 306 taints the stock used in the scheme as Section 306 stock. Special rules then govern all subsequent dispositions of the tainted stock. With its concept of a taint that can dog a stock from acquisition to disposition, Section 306 might have been designed by a novelist rather than a tax technician

The Suitability Rule and Economic Theory

The published rules of both the National Association of Securities Dealers (NASD) and the Securities and Exchange Commission (SEC) provide that a broker or dealer in the securities market may recommend the purchase of a security only when there is a reasonable basis for believing that the security is suitable for the customer

State Ethical Codes and Federal Practice: Emerging Conflicts and Suggestions for Reform

The standards for resolving putative conflicts between federal laws are not always clear, and neither for that matter is the standard for determining what con- stitutes a federal law capable of superseding effect. The technique of setting federal norms of professional conduct on a decentralized basis by borrowing or incorporating state norms is increasingly trouble- some to the extent that the borrowed state norms are disuniform and that they are being put to multiple remedial purposes. Federal legisla- tion preempting state law of professional conduct is conceivable but hardly likely, particularly as the norms are pressed into duty for pur- poses other than professional discipline. Pending other steps that might lead to national uniformity, the answer for the federal courts may be a uniform set of norms directly regulating litigation conduct in all federal courts

VARIATION IN BODY TEMPERATURE AND THERMOREGULATORY BEHAVIOR BETWEEN TWO POPULATIONS OF THE LESSER EARLESS LIZARD, HOLBROOKIA MACULATA

Body temperatures and thermoregulatory behavior of field-active Holbrookia maculata were evaluated for two sites at approximately equal elevation (approximately1200 m) in southern New Mexico: 1) a population at White Sands National Monument, and 2) a population at the Jornada Long-term Ecological Research site. H. maculata at WS had significantly lower body temperatures (mean = 36.3°C) than those measured at the Jornada Long-term Ecological Research site (mean = 39.5°C). The slope of a regression of body temperature on air temperature was significantly different between populations (White Sands National Monument; 0.65, the Jornada Long-term Ecological Research site; 0.36). The microhabitats in which individuals were first observed correlated with body temperatures at White Sands National Monument, but not at the Jornada Long-term Ecological Research site. These data suggest that environmental temperature differences between sites influenced body temperatures and thermoregulation in behavior H. maculata

Taxing Stock Dividends and Economic Theory

Since 1936, the Internal Revenue Code has treated elective stock dividends on common stock, which are taxed on receipt as shareholder ordinary income gain, differently from pro rata stock dividends on common, which are received tax-free. This difference in treatment was reenacted in Section 305 of the 1954 Code; and while the Tax Reform Act of 1969 changed many details of stock dividend taxation, the basic distinction between elective and pro rata stock dividends was, if anything, reinforced. The major purpose of the 1969 amendments to Section 305 was to impose a shareholder ordinary income tax on transactions with the same substance, but lacking the formal indicia, of the receipt of elective stock dividends on common stock. Therefore, a reexamination of the rationale for current distinctions between taxable and nontaxable stock dividends is particularly appropriate

Thurgood Marshall: Tax Lawyer

During his twenty-four years on the Supreme Court, Justice Thurgood Marshall wrote better opinions on the law of federal income taxation than any of his fellow Justices. This is, of course, a subjective appraisal which others may dispute. Nevertheless, from two decades of teaching federal income taxation, I am convinced of the quality of Marshall\u27s work

Conditioning U.S. Security Assistance on Human Rights Practices

In the United States, with its government of separated powers and functions, it is the executive branch, and in particular the Department of State, that bears responsibility for implementing legislation on foreign relations. The success of implementation will depend on political decisions, involving competing national interests, as well as on institutional and personal considerations of I he officials concerned. Inevitably, there is a gap between legislation and execution, especially when the Executive is not wholly sympathetic to the law. The gap may even devour legislated policies as the Executive refuses to take Care that the Laws be faithfully executed, and bureaucratic and personal considerations distort judgments, exploit the generality and uncertainty of language, and lead to abuse of discretion. A notable instance of this problem has been executive implementation of legislation on international human rights