Almost everybody knows about the deduction for charitable contributions. But very few students come to tax class knowing much about how it works or having considered why it might be complicated. And yet, the sheer length of section 170 hints at its complexity.

In this episode, Professor Brian Galle discusses three mechanics of the rules: the overall cap on deductible contributions, the interaction of the deduction with realization rules, and the requirement to exclude any benefits received from the amount given. Professor Galle also explores the underlying tax policy considerations and illustrates the practical effects of these mechanical rules. Professor Galle is the Agnes Williams Sesquicentennial Professor of Tax Policy at Georgetown University Law Center.

Tax Class is hosted by ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Ben Leff⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and produced by Tony Xu. The theme music is by Doo Dah Music. None of the information presented in this podcast constitutes legal advice. Consult an attorney or a tax professional for guidance.

IN THIS EPISODE

· IRC § 170

· Treas. Reg. § 1.170A-1

· Lary v. United States, 787 F.2d 1538 (11th Cir. 1986)

· Rolfs v. Commissioner, 668 F.3d 888 (7th Cir. 2012)

· Hernandez v. Commissioner, 490 U.S. 680 (1989)

What can you write off as a business expense? At the most general level, section 162 says “all the ordinary and necessary expenses” for the trade or business, as long as they are not disallowed elsewhere in the Code. But what is “ordinary” and what is “necessary”?

Professor Steven Dean points out that the “ordinary” requirement, by definition, favors the common practice and, therefore, disfavors the minority. What may seem merely surprising (or even shocking in some cases) may also reveal systemic privilege or even racism. As a casebook author himself, Professor Dean believes that its important for legal educators to provide relevant context, including about race, for students to draw their own conclusions. Professor Dean is a professor of law and the Paul Siskind Research Scholar at Boston University School of Law.

Tax Class is hosted by ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Ben Leff⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and produced by Tony Xu. The theme music is by Doo Dah Music. None of the information presented in this podcast constitutes legal advice. Consult an attorney or a tax professional for guidance.

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IN THIS EPISODE

· IRC §§ 162(c), (f), (g); 280E

· Kopp’s Company, Inc. v. United States, 636 F.2d 59 (4th Cir. 1980)

· Cavanaugh v. Commissioner, T.C. Memo. 2012-324

· Gilliam v. Commissioner, 51 T.C.M. 515 (1986)

· Dancer v. Commissioner, 73 T.C. 1103 (1980)

Income also includes non-cash compensation. Whether that is in the form of tangible property or stock options, section 83 rules it all. Section 83 also allows the taxpayer to elect when and how to account for the property received. The seemingly mechanic election puts the ball in the taxpayer’s hands to figure out the most advantageous tax treatment.

In this episode, Professor Sarah Lawsky uses section 83 to illustrate her unique way of teaching the introductory tax law class. Professor Lawsky is the Howard Friedman '64 JD Professor of Law at Northwestern University, Pritzker School of Law.

Tax Class is hosted by ⁠⁠⁠⁠⁠⁠⁠Ben Leff⁠⁠⁠⁠⁠⁠⁠ and produced by Tony Xu. The theme music is by Doo Dah Music. None of the information presented in this podcast constitutes legal advice. Consult an attorney or a tax professional for guidance.

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Materials mentioned in this episode:

• IRC § 83
• Sarah Lawsky Personal Websites: https://www.sarahlawsky.org
• Practice Problem Site: https://www.lawskypracticeproblems.org

The Code defines gross income as “all income from whatever source derived” unless otherwise provided. But what are some kinds of income excluded from such a broad definition? Section 104 provides that compensation for personal injuries and sickness, among other things, is excluded from gross income.

In this episode, Professor Heather Field demonstrates the art of statutory interpretation by dissecting a short but not-so-simple part of section 104. Professor Field is the Stephen A. Lind Professor of Law and Co-Director of the Center on Tax Law at the University of California Law San Francisco (formerly UC Hastings).

Tax Class is hosted by ⁠⁠⁠⁠Ben Leff⁠⁠⁠⁠ and produced by Tony Xu. The theme music is by Doo Dah Music. None of the information presented in this podcast constitutes legal advice. Consult an attorney or a tax professional for guidance.

Subscribe to the show for more insights into the federal income tax. Send any comments or questions to ⁠⁠⁠⁠TaxClassPodcast@gmail.com⁠⁠⁠⁠.

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Materials mentioned in this episode:

• IRC § 104
• Pre-class exercise

Computing gross income is the first step in figuring out income tax. The broad language used in section 61 of the Internal Revenue Code is not helpful in answering what constitutes “gross income.”

While payments for wages or salaries are almost always counted as gross income, not all money received is income (e.g., borrowing money is not income). Vice versa is also true—you can have income without receiving any money (e.g., cancellation of debt).

In this episode, Prof. Jennifer Bird-Pollan explains the distinction between getting paid and having an income. Prof. Brid-Pollan is the Alan S. Schenk Chair in Taxation at Wayne State University’s law school.

Tax Class is hosted by ⁠⁠⁠⁠Ben Leff⁠⁠⁠⁠ and produced by Tony Xu. The theme music is by Doo Dah Music. None of the information presented in this podcast constitutes legal advice. Consult an attorney or a tax professional for guidance.

Subscribe to the show for more insights into the federal income tax. Send any comments or questions to ⁠⁠⁠⁠TaxClassPodcast@gmail.com⁠⁠⁠⁠.

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Materials mentioned in this episode

Internal Revenue Code: §§ 61(a),108(f), 165(a), 165(c)(2), 166.

Cases:

• Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955);
• United States v. Kirby Lumber Co., 284 U.S. 1 (1931);
• Eisner v. Macomber, 252 U.S. 189 (1920).

The first class of the semester is not just about the syllabus. Professor Miranda Perry Fleischer uses her first class to lay the foundation for the rest of the semester, as well as to convince any hesitant students that federal income tax is not just about numbers. In this episode, Professor Fleischer explains how she uses a fictitious bad tax law to illustrate some of the big concepts in tax policy.

Professor Fleischer is the Associate Dean of Faculty and Richard and Kaye Woltman Professor in Finance at the University of San Diego School of Law.

Tax Class is hosted by ⁠Ben Leff⁠ and produced by Tony Xu. The theme music is by Doo Dah Music. None of the information presented in this podcast constitutes legal advice. Consult an attorney or a tax professional for guidance.

Subscribe to the show for more insights into the federal income tax. Send any comments or questions to ⁠TaxClassPodcast@gmail.com⁠.

Welcome to Tax Class by Ben Leff, professor of law at the American University Washington College of Law.

In this series, Professor Leff interviews some of the best tax scholars and professors around the country about one day in their introductory tax law class. In each episode, the guest professor will discuss their path to academia, dissect the big concepts for the unit, and divulge their teaching method.

Subscribe to the show today for the latest episode. Send any comments or questions to TaxClassPodcast@gmail.com.

Tax Class is hosted by Ben Leff and produced by Tony Xu. The theme music is by Doo Dah Music. None of the information presented in this podcast constitutes legal advice. Consult an attorney or a tax professional for guidance.