International Tax Blog

Source of Income When Business Is Begun In One Country And Ended In Another

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: The question where an income is earned is always a matter of doubt when the business is begun in one country and ended in another. Barclay & Co. v. Edwards, 267 U.S. 442 (1924). In this case, the Supreme Court held that it was not... Read more →

Clapping With One Hand

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: The Commissioner’s position * * * is the legal equivalent of trying to clap with one hand. Eshel v. Commr., No. 14-1215 (D.C. Cir. August 5, 2016). Read more →

King Minos’ Labyrinth

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: At this point, we are reminded of the words of Chief Judge Kaufman, who noted the ability of Congress to pass statutes certain to accelerate the aging process of judges: “We have had occasion to note the striking resemblance between some of the laws we... Read more →

Famous Tax Quotes - “Tax Language”

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: Like many other terms, liquidation does not mean in tax language what it may in ordinary speech. Abegg v. Commr., 429 F.2d 1209 (2d Cir. 1970). Read more →

Famous Tax Quotes - Where to Draw the Line

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: [We are not] troubled by the question where to draw the line. That is the question in pretty much everything worth arguing in the law. Irwin v. Gavit, 268 U.S. 1 (1925) Read more →

Famous Tax Quotes - The Basic Structure of the Internal Revenue Code

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: [T]he basic structure of the Internal Revenue Code * * * may be summarized as follows. The tax imposed is based upon jurisdiction over either the person of the taxpayer or the income taxed. Citizens (including domestic corporations) and resident aliens are taxed on all... Read more →

Muddled Tax Return Reporting

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: The Trust and the siblings reported this deal in so muddled a way that the IRS was bound to notice. Van Alen v. Commr., TC Memo 2013-235 Read more →

Residence - As Many Colors As Joseph's Coat

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: Residence * * * has an evasive way about it, with as many colors as Joseph's coat. * * * The determination is factual and must be made through a consideration and balancing of all the elements involved. Adams v. Commr., 46 T.C. 352 (1966)... Read more →

A Rose is a Rose is a . . .

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: To respondent's assertion that our interpretation mixes apples * * * and oranges * * *, we think the literary quote more appropriate to the issue involved herein is a “Rose is a rose is a rose is a rose.” Estate of Burghardt v. Commr.,... Read more →

Famous Tax Quotes - Taxing Citizens by Reason of Citizenship

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: The United States was historically and continues to be virtually unique in taxing its citizens, wherever resident, on their worldwide income, solely by reason of their citizenship. Crow v. Commr., 85 T.C. 376 (1985) Read more →

Famous Tax Quotes - "Maxims" & "Minims"

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: We do not quarrel with the maxim that substance must prevail over form, but this proposition marks the beginning, not the end, of our inquiry. The court in Sheppard v. United States * * * perceptively remarked that “all such ‘maxims’ should rather be called... Read more →

“Laughable” Test – All Caps Spelling

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is from a case where the government was awarded $2,000 of sanctions against a taxpayer’s attorney, where the attorney filed motions containing frivolous arguments intended to delay court proceedings. Baxley's assertion that the defendant is not the same individual as named in the complaint because he... Read more →

Famous Tax Quotes - From the Brow of Zeus

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quotes are related to Greek mythology: “Royalties do not spring, full-fledged, from a pen or typewriter, like Athena from the brow of Zeus (although many writers wish that they would).” Simenon v. Commr., 44 T.C. 820 (1965) “It is said that Athena sprang full-grown from the brain... Read more →

Famous Tax Quotes - Can’t Have Your Cake and Eat It Too

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: [The taxpayer] cannot retain his cake and consume it as well. Eagan v. U.S., 80 F.3d 13 (1st Cir. 1996) Read more →

Famous Tax Quotes - Hiding the Pea

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: Our tax system depends upon self assessment and honesty, rather than upon hiding of the pea or forgetful tergiversation. Janis v. Commr., 461 F.3d 1080 (9th Cir. 2006) Read more →

Famous Tax Quotes - Expatriation is a Serious Act

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: [E]xpatriation is a serious act that should be undertaken with a full understanding of the consequences. Dacey v. Commr., TC Memo 1992-187. Read more →

Famous Tax Quotes - Morass of United States Tax Laws

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: [T]he morass of the United States tax laws * * * [T]he same words may have different meanings. AMP, Inc. v. U.S., 492 F.Supp. 27 (District Ct. Mid. Dist. Pa. 1979) Read more →

Famous Tax Quotes - Earnings and Profits

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: "[T]he calculation of earnings and profits is not easy or obvious." Welle v. Commr., 140 T.C. 420 (2013) Read more →

Famous Tax Quotes - Precedent

Continuing our series on Famous Tax Quotes (quotes from court opinions and rulings with language that is colorful or that concisely states an important tax principle) today's tax quote is: [T]he age of [certain] holdings [does not] diminish their precedential weight * * * There is simply no merit to the proposition that precedent somehow becomes less binding solely with the passage of time Seggerman Farms v. Commr., 308 F.3d 803 (7th Cir. 2002) Read more →

Famous Tax Quotes - If Rube Goldberg Had Been a Tax Accountant

The following is a quote from the U.S. District Court, D. Massachusetts, regarding a “Structured Trust Advantaged Repackaged Securities” (“STARS”) transaction: [T]he transaction was surpassingly complex and unintuitive; the sort of thing that would have emerged if Rube Goldberg had been a tax accountant. Santander Holdings USA, Inc. v. U.S., 2013-2 U.S.T.C. ¶50,564, (Oct. 17, 2013) Read more →

Famous Tax Quotes - The Form of a Transaction Can Control Tax Consequences

"[T]he solution of hard tax cases requires something more than the easy generalization that the substance rather than the form of a transaction is determinative of its tax effect. * * * [I]n numerous situations the form by which a transaction is effected does influence or control its tax consequences * * *." Casner v. Commr., 450 F.2d 379 (5th Cir. 1971) Also, "The statute itself exalts form over substance." Chrome Plate, Inc. v. Commr.,... Read more →

Famous Tax Quotes - The IRM Holds No Legal Significance

The following is a quote from the U.S. District Court in Northern California regarding a taxpayer’s reliance on the Internal Revenue Manual: "[T]he IRM holds no legal significance." Hom v. U.S., U.S. District Ct., N. Calif. No. C 13-02243 WHA. Dated: September 30, 2013 The District Court in the Hom case also quotes the Ninth Circuit as follows: "The Internal Revenue Manual does not have the force of law and does not confer rights on... Read more →

Famous Tax Quotes - [Un]Comfortable Degree of Accuracy

The following is a quote from the Tax Court regarding the computation of tax basis of an inherited apartment located in Berlin, Germany: The question, then, is whether * * * we are to deny petitioner any basis * * * because we cannot determine the basis with that comfortable degree of accuracy which is always desirable. We cannot, under proper circumstances, avoid determination of the proper basis for computing a deduction merely because the... Read more →

Famous Tax Quotes - Double Taxation Cannot Always Be Avoided

The following is a quote from the Tax Court regarding the computation of the foreign tax credit limitation: “[Elimination of double taxation is] admittedly the objective of the foreign tax credit. But . . . this objective cannot always be fully achieved.” Perkin-Elmer Corp. v. Commr., 103 T.C. 464 (1994). Read more →

Famous Tax Quotes - "Bureaucrats"

The following is a quote from the Sixth Circuit regarding whether the taxpayer must formally be told "no" by a foreign government bureaucrat: Bureaucrats across the globe have a million ways to convey “No,” without ever having quite to say so. U.S. Padding Corp. v. Commr., 865 F.2d 750 (6th Cir. 1989), aff'g 88 T.C. 177 (1987). Read more →