854 research outputs found
Treble Damages in National Health Service Corps Contracts, Public Policy, and Hawronsky v. Commissioner
The main thesis of this article is that Hawronsky v. Commissioner is erroneous and the deduction should be allowed because I.R.C. § 162(f) does not apply. The taxpayer did pay a fine or similar penalty to the government, but he did not pay it for the violation of any law, which is a necessary element of I.R.C. § 162(f). The taxpayer merely breached his NHSC contract. This crucial issue went completely unnoticed by the court and the parties. Because I.R.C. § 162(f) does not apply, the treble damages are (except for the original tax-free scholarship itself) a deductible business expense of buying out the NHSC service obligation. Along the way, however, the article finds much else to criticize in this problematic litigation. First, the fine or similar penalty language of I.R.C. § 162(f) is poorly conceived and has led to great confusion. Second, the judge-made public policy doctrine, which I.R.C. § 162(f) was intended to simplify and replace was itself highly questionable, and probably ought to have been legislated away rather than codified. And finally, the NHSC\u27s colossal treble-damage penalty seems harshly disproportionate to any actual harm that a scholarship participant\u27s breach might cause, and probably should never have been enacted
Treble Damages in National Health Service Corps Contracts, Public Policy, and Hawronsky v. Commissioner
The main thesis of this article is that Hawronsky v. Commissioner is erroneous and the deduction should be allowed because I.R.C. § 162(f) does not apply. The taxpayer did pay a fine or similar penalty to the government, but he did not pay it for the violation of any law, which is a necessary element of I.R.C. § 162(f). The taxpayer merely breached his NHSC contract. This crucial issue went completely unnoticed by the court and the parties. Because I.R.C. § 162(f) does not apply, the treble damages are (except for the original tax-free scholarship itself) a deductible business expense of buying out the NHSC service obligation. Along the way, however, the article finds much else to criticize in this problematic litigation. First, the fine or similar penalty language of I.R.C. § 162(f) is poorly conceived and has led to great confusion. Second, the judge-made public policy doctrine, which I.R.C. § 162(f) was intended to simplify and replace was itself highly questionable, and probably ought to have been legislated away rather than codified. And finally, the NHSC\u27s colossal treble-damage penalty seems harshly disproportionate to any actual harm that a scholarship participant\u27s breach might cause, and probably should never have been enacted
The Deductibility of a Worthless Right to Contribution for Joint Income Taxes: The Mistaken Line of Cases under Rude v. Commissioner
Is Compromise of a Tax Liability Itself Taxable? A Problem of Circularity in the Logic of Taxation.
Treble Damages in National Health Service Corps Contracts, Public Policy, and Hawronsky v. Commissioner
- …