The New Congressional Attack on Offshore Rabbi Trusts

Beckett G. Cantley, The New Congressional Attack on Offshore Rabbi Trusts, 5 Or. Rev. Int’l L 5 (2003). Summary.  This article discussed certain tax provisions that were contained in the draft National Employee Savings and Trust Equity Guarantee Act (“NESTEG Act”).  These provisions would have made funds held in offshore rabbi trusts immediately subject to US income tax to the beneficiary of the offshore rabbi trust.  The estimated result to the US Treasury Department would have been a significant increase in tax collection.  Offshore rabbi trusts have become common vehicles for US persons employed abroad by foreign companies to set aside retirement funds.  In addition, many offshore hedge fund managers have used offshore rabbi trusts as a means to defer income from current taxation.  This article discussed the previously proposed legislation, the likelihood of such legislation’s passage in the next Congress and the legal doctrines and tax policy implications involved in making such a change in tax policy.

The New Tax Shelter Opinion Letter Regulations: Cutting Back a Client’s Ability to Rely on the Advice of His Counsel

Beckett G. Cantley, The New Tax Shelter Opinion Letter Regulations: Cutting Back a Client’s Ability to Rely on the Advice of His Counsel, 18 Akron Tax J. 47 (2003). Summary.  This article analyzed certain Proposed Treasury Regulations (“Opinion Regs”) relating to the issuance of tax opinions by counsel on matters that are “reportable transactions”.  The Opinion Regs were the seemingly final piece in Treasury’s offensive against tax shelters.  The Opinion Regs put up significant barriers to a client being able to rely on advice of counsel in tax shelter matters.  The main question this article discussed was whether the inability of a client to rely on a client’s counsel on such complicated matters as tax shelters is good public policy.  This article answers the question by concluding that it is not good public policy.

New Tax Information Exchange Agreement: A Potent Weapon Against U.S. Tax Fraud

Beckett G. Cantley, New Tax Information Exchange Agreement: A Potent Weapon Against U.S. Tax Fraud, 4 Hous. Bus. & Tax L.J. 231 (2004). Summary.  This article discussed the then-new information exchange agreement to the tax treaty between the U.S. and Switzerland.  The agreement established new guidelines on how to properly implement Article 26 (pertaining to information sharing) of the Convention between the U.S. and the Swiss Confederation for the Avoidance of Double Taxation with Respect to Taxes on Income. The new agreement attempted to strengthen each government’s respective ability to combat tax fraud. The new agreement clarifies the tax treaty and provides guidance as to what constitutes “tax fraud” under the existing agreement by providing fourteen (14) hypothetical situations that constitute tax fraud.  The focus of this article was to discuss operational and policy elements of specific points of the new agreement followed by a discussion of what Switzerland and U.S. officials think about the possible long-term effects of the new agreement.

The New Dividend Tax Cut: Bush’s Prescription for Rescuing the Economy

Beckett G. Cantley, The New Dividend Tax Cut: Bush’s Prescription for Rescuing the Economy, 19 Akron Tax J. 25 (2004). Summary.  This article This article discussed President Bush’s various tax cuts contained in his 2004 “economic growth” package, including Bush’s plan to eliminate the double taxation on dividends. The article outlines the different tax cuts, the legislative process that produced them, the differing interests involved in the process and several different viewpoints on whether these tax cuts will have their intended growth effect.

Congress Giveth and Congress Taketh Away: The Slow Death of the SESOP

Beckett G. Cantley, Congress Giveth and Congress Taketh Away: The Slow Death of the SESOP, 20 Akron Tax. J. 59 (2005). Summary.  This article discusses the cat and mouse game that had taken place between the IRS and tax planners surrounding the use of the SESOP.  The article outlines how the SESOP has been a very rich source of tax gamesmanship since its inception.  However, while Congress and the IRS have been very effective at closing all the perceived loopholes used by tax planners, they have equally been extremely adept at dismantling the SESOP as a viable planning vehicle for the average small family business.