woo hoo!  finals are over (again)...

and it was crazy.  my income tax I exam was nuts, and I know I missed at least 3 questions.  

the problem is that with 30 questions at 3 points each, and you get an additional minus 1 point for wrong answers, I did the math and it turns out that if you answer the 3 questions and get them wrong, you get 78 points.  if you didn't answer the questions, you get 81 points.  the discrepancy grows as the number of wrong answers increases.  For instance, if you answer 10 questions wrong, you get 50 points.  But if you didn't answer those 10 questions, you get 60 points. 

the worst example of unfairness in this system is where you have student A who answered only 25 questions, but got them all right (5 no answer).  This person gets 75 points.  But, if student B was in the same position (5 no answer), and decided to take a stab at one of them, but gets it wrong, then this person will end up with 74 points.  the discrepancy grows as the number of no answer/make a stab at it decisions increases.  

the cutoff is at 26 correct answers -- here, you get 78 points for answering 26 correct questions.  If you make a stab at one of the four unanswered questions, if you get it wrong, you are still at 78 points.

but below 26 correct answers, you are a fool to answer them unless you know you are absolutely right.  while this may discourage random guessing, it seems to encourage not completing the exam.  when it comes to the top few people in the class, the highest grade goes to the person who figures this system out (before the exam).   usually, it is a tossup between two potentially correct answers, and in a normal system you have a 50-50 chance of getting the points.  But where you are dinged for making the wrong choice, your chances are decreased.  it becomes a system of "better no answer" -- which is not what I thought testing was all about. 

Problem:  we were not warned about this grading policy before the exam.  If we had been, we would have had enough time to figure it out and decide our test taking strategies. 

if you can't defeat terrorism with conventional means -- use the tax laws!
Andrew C. McCarthy on Holy Land Foundation

read this article! besides not being afraid to use the "T" word, he actually does a pretty good job summing up the problem with hamas.

no more 501(c)(3) status...and about time.

unfortunately, however, two of the hamas culprits have fled the country.

finally, at least, one of the prime money sources will be cut off. but, there's always europe, and the islamic secret money exchanges.

Woo Hoo!  I made Law Review!
 
I can't believe it, I'm so excited!  I'm jumping around doing the "woo hoo" dance...
 
Hard work, no pay, miserable cite checking...
 
what more could a law student want? 
 
another round of the "woo hoo" dance...time to C-E-L-E-B-R-A-T-E!!!

Internet Access Tax Moratorium Debte

Gene Quinn has a great collection of information on the current debate, and links to his 2000 article:
Tax Implications for Electronic Commerce Over the Internet, 4.3 J. Tech. L. & Pol'y 1 (2000).

much ado and I haven't had much time to investigate this lately, though I've been tracking developments for the last few years.

my basic position: access should be completely free of taxation, but commerce could be taxed in a reasonable way.

why access should be free:
to explain by the oft-touted analogy to the "information superhighway"...
we do not pay a direct tax any time we take an on ramp on our local highway (unless you are on a toll road, and that is a usage fee, not a tax). by the same analogy, we should not pay a tax simply to jump on an information superhighway.

in the first, you pay tax when you buy your car, when you buy gasoline (which yes, I do recognize includes some "highway tax", but it is administered as a consumption/sales tax), and when you make repairs.

in the second, you pay tax when you buy your computer (like the car), when you buy something on amazon (like gasoline), and for repairs from usage or damage from viruses.

with both the car and the computer, we access the highway in order to locate and purchase/consume things, to produce income in order to purchase/consume things, or for personal pleasure.

those who can't afford cars or computers still need to access the highway, and they take the bus or go to the library or an internet cafe.

When we have long had the tradition of a free highway system (with the few toll roads as an exception) for cars, is it not only fair but right to have access to the internet free from taxation?

But more importantly is the issue of double taxation -- we already pay tax on our internet bill (especially if you are using your telephone line). And we pay tax on our cell phones and pdas which also access the internet.

Now I'm not against reevaluating the situation if access to the internet was ubiquitous, but we are still in the first 50 years of this project. not everyone can afford access yet -- many people can't even afford a computer. the federal government should continue to encourage expansion of access unhindered by yet another consumption tax which will impact the ones who can afford it the least the most.

and on that note, I will realize that it is getting later and I have some final exams to attend to...

and in two weeks, my "all tax, all the time" summer will come to an end (woo hoo!). then it will be "some tax, some of the time" before it becomes the "work you to death" year.

The New York Times > Washington > Charities Face Increased Reviews by I.R.S. as Senate Considers Strengthening Oversight

since this summer is the "all tax, all the time" summer, I've been keeping an eye out for any new tax issues on the horizon.

The IRS has a new commissioner and things are changing...and charities are now the new focus for ferreting out fraud. the lack of oversight (probably because the IRS determined that charities were largely compliant in the 80's) has possibly led to the appearance of easy street and the potential for abuses is high.

I'm a bit concerned about Congress looking into the cash-for-cars programs. I recognize there is a problem if the taxpayer takes a charitable deduction for blue book value but the auctioneer lets the car go at a bargain rate. One idea is to force the charities to report back to the donor the amount received on the sale to report for tax purposes. The problem with this idea is that the paperwork would be massive and the time it would take for the charity to generate reports (which, of course will have to go on some IRS form and be reported to the IRS) would make the program less attractive to both charities and donors. A tracking system for car donations, however, is very attractive to the IRS.

we like to give to charities, we like people to be able to get rid of their old cars (please, no lawn ornaments, thank you). It seems that the easiest way to organize a deduction system for car donations would be to give a flat rate deduction (i.e. $500 for cars that are 1980 or older, $1000 for cars that are 1990-1999) and $1500 for cars that are less than 5 years old).

the problem that "Mr. Car" points out to Congress is that the auctioneers aren't selling the cars for very much and are pocketing the proceeds. A flat rate deduction is attractive here because the legislation could require that the charities receive the full amount that is claimed as a deduction by the taxpayer (i.e. $500/1000/1500) and the auctioneer would then have incentive to sell the car for a higher amount if he wants to make a profit. There may, of course, need to be some kind of 10% auction fee ceiling, or some device by which the auction expense is a deductible expense for the charity.

of course, what comes out of Congressional committees is often a world of compromises. I expect there will be some tightening up on the reporting and claiming of deductions, and I foresee a new IRS Form and reporting requirements in the works -- perhaps the 1099-CAR "Charitable Car Donation Worksheet (instructions in separate 40 page booklet)"?

Eight Diverse Gay Couples Join to Fight Massachusetts

first legal challenge to the governor's hackneyed resurrection of a 1913 law that is not only discriminatory (as it treats out of state residents differently, but also it was enacted to prevent interracial marriage)...but stupid.

eight couples are filing suit today because MA has told them their marriages aren't valid or won't issue the license because they live out of state. plaintiffs include an FBI agent.

a second suit is being filed by the cities and counties.

the plaintiffs' arguments are probably constitutionally strong -- especially because the law is old, hasn't been used for a long time, and is now being used in a way that is constitutionally invalid in light of how constititional law changed dramatically after the New Deal.

I hope they are successful and the governor backs off. it won't be an easy fight to win, but these suits look strong and the governor's 1913 law will protect him to the extent it has been used in the last 60 years (what? you mean its never been used?).

just a note that I haven't completely missed the Supreme Court's response to the Pledge case.

this was a completely predictable result. there was no way the Court could get to the merits because the guy had pretty shaky standing. I think O'Connor [but I could be wrong] argued that he had standing because it was his rights he was protecting. but as the non-custodial parent, his standing was weak. The Court tends to pass on first go-round if they don't have a solidly standing plaintiff.

interestingly, the Court seemed willing to hold that the "under g-d" was not Constitutional, provided they can get to it. It would be a divided court, but I think there is a majority leaning that way.

now if we can only find a good plaintiff, the issue can be dealt with once and for all. but since we are at war that involves religious overtones, I don't think it is a good idea right at the moment -- but overall, the words don't belong there. the only reason why they should be allowed to remain for a little while longer is that people have gotten very used to the words there over the last 50 or so years, and to take g-d's shelter away from america at this critical time would be a psychological blow to many people, and would shake their patriotism. we need all the patriotism we can get right now.

"The Tax Code...

is like watching a train wreck in slow motion."

this humorous statement was made by a fellow tax law student on the first day of class.

I think about it and laugh, but I really don't see reading the tax code as detailing impending doom...maybe I'm missing something.

so the summer session is underway, but I am due to escape for a few days and pitch a tent, relax with old friends, listen to some really great music, and take a well earned break after finishing First Year.

not all the grades are out, but so far three are decent. one is not, but "at least I passed" (soon to become my most used phrase in relation to my grades). there is still two years to pull my grades up, I can only hope my performance continues to improve.