Much empirical evidence is consistent with properly incentivized executives engaging in more tax avoidance. However, other studies provide evidence consistent with tax avoidance facilitating managerial rent extraction. We address these mixed results by reexamining the negative relation between...

Although income tax expense is a significant input to valuation models, little empirical evidence exists about which rates investors incorporate. The limited guidance available suggests investors should use the marginal tax rate (MTR), but it is unclear whether investors follow this guidance. We...

We examine how different accounting metrics used to evaluate CEO performance for annual bonuses affect the level of corporate tax planning as well as financial reporting for income taxes. We predict and find that firms using cash flow metrics report lower GAAP and cash effective tax rates (ETR)...

We examine two competing explanations for the negative relation between equity compensation and tax avoidance documented in prior research. The first explanation suggests that equity compensation aligns managerial interests and reduces managers' incentives to invest in tax avoidance schemes that...

Global tax enforcement has received increased attention since the Financial Crisis, with much stated focus on curbing perceived harmful tax practices of multinational entities. Yet multinationals can avoid tax in multiple countries whereas domestic firms cannot. We therefore examine whether...

Managers face conflicting incentives when making voluntary tax disclosure decisions. Although voluntary tax disclosures can improve firms' information environments and reduce financial statement users' costs of processing complex tax information, they can also inform tax authorities about...

We propose that auditor-provided tax services (tax NAS) improve internal control quality by accelerating audit firm awareness of transactions material to the financial statements. Using data from 2004 to 2012, we find robust evidence that companies purchasing tax NAS are significantly less...

Many corporations shared their cash windfalls from the Tax Cuts and Jobs Act (TCJA) with rank-and-file employees through bonuses, higher wages, or increased benefits. We use novel data from Culture X to examine how the announcement of TCJA bonuses affects employee sentiment about their...