Tax-free savings accounts (quot;TFSAsquot;) became available in Canada in January 2009. A TFSA is a quot;tax prepaidquot; or quot;yield-exemptquot; investment account that does not provide any deduction for contributions and allows for tax-free compounding of investment returns in addition to...

This article analyzes the economic benefits and costs of the income trust vehicle for entrepreneurs organizing their business affairs. In doing so it examines the precise nature of the relationships between capital structure, income taxes and income trusts, reaching the conclusion that neither...

In this article, we explore how tax experts can use machine learning tools to safely test and assess potential litigation strategies before deploying them at trial or on appeal. This can be especially useful for cases involving questions of law that turn on interrelated factors, such as the step...

The need to determine whether a taxpayer is engaged in a “trade or business” arises frequently. Although the term “trade or business” is used throughout the IRC and the associated regulations in the Code of Federal Regulations, it is not defined explicitly. In some ways this is...

In this article, we provide general observations about how tax practitioners are beginning to learn how to leverage the insights of machine learning to “crack the tax code.” We also examine how tax practitioners are using machine learning to quantify risks for their clients and ensure that...

Issues surrounding worker classification go back decades in the tax context. Given the rise of the gig-economy, these issues have resurfaced with urgency, with Uber and other gig-economy service providers making headlines for the past several years for allegedly misclassifying workers. The...

Several months ago, we examined the Tax Court’s decision in Reserve Mechanical and predicted with 77 percent confidence that the taxpayer’s appeal would be dismissed and the Tax Court’s decision affirmed. The Tenth Circuit has now made that prediction accurate. In its decision, the Tenth...

The Tax Court held in Skolnick that horse breeding activities conducted by the taxpayers through Bluestone Farms LLC (which was treated as a partnership for federal income tax purposes) were not engaged in for profit. While several factors were indicative of a trade or business, including the...

To illustrate the insights possible with machine learning, we use the Blue J debt-equity predictor to analyze part of the decision recently rendered in Tribune Media. Tax Court Judge Ronald L. Buch discussed and assessed the 13 Dixie Dairies factors in Tribune Media, analyzing whether the...

The Chemoil tax dispute provides an opportunity to explore the relationship between the economic substance doctrine and unprofitable transactions that are rendered economically viable by tax credits. Chemoil raises a particularly interesting point of contention. Transactions that generate...