Government Tax Incentives
and Fixed Asset Acquisitions: A Comparative Study of Four Industrial
Thomas M. Porcano
The use of tax and nontax government incentives
to stimulate business investment in fixed assets is commonplace.
Most of these incentives are supply-side measures. This article
presents the results of a study designed to determine the efficacy
of such provisions. The four industrialized countries examined
in this study were selected because of the similarities in their
economic objectives and because of the variety of their incentive
provisions. The results clearly indicate that none of these different
measures and techniques significantly impact decision making involving
fixed assets. Implications of the findings also are presented.
Impact of Tax Law Complexity
Stewart S. Karlinsky and Bruce S. Koch
This study examined the impact of income tax law
complexity-reading complexity and content complexity -on the task
performance of professional accountants. The research results
have implications for the appropriate presentation style of the
tax law as well as the applicability of standard readability tests
to professional readers. In a laboratory experiment 98 tax and
accounting professionals were randomly assigned to one of four
experimental conditions. The experiment tested the subjects' ability
to understand and correctly answer client questions involving
practical situations. The impact of reading complexity on overall
understanding, holding underlying content complexity constant,
also was tested. Results indicate that presentation style exacerbated
the effect of an already difficult tax law concept. Also, for
adult subjects, a newly developed readability index was superior
to standard readability tests currently used by federal and state
An Expert System for Selecting
Robert H. Michaelsen
Expert systems are computer programs that use expert
knowledge to solve problems. Although such programs have proven
useful in a number of important domains of knowledge (e.g.., geology
and medicine), they are in their infancy in the field of taxation.
This paper presents an expert system that matches a client with
an appropriate type of real estate or oil and gas tax shelter.
Software development involved extraction of heuristic rules from
interaction with tax experts. After the model was created, it
was subjected to a blind evaluation by tax specialists. The results
indicate that expert systems are feasible for tax shelters and
provide evidence concerning the appropriate domain size for such
programs in taxation.
Professors Who Teach Outside
the United States: Tax Planning and Policy Analysis
Ernest R. Larkins
Although originally intended to increase U.S. exports,
the current Section 911 exclusions are available to anyone who
can establish the required nexus with a foreign country. Professors
who teach outside the United States can qualify and avoid U.S.
income tax on their compensation. They also can avoid foreign
income taxes through the use of little-publicized tax treaty provisions
available to educators. Planning is essential to satisfy the Section
911 eligibility requirements. Similarly, qualifying for the educator
exemption found in most U.S. tax treaties is assured only if tax
planning precedes and accompanies the foreign teaching assignment.
A tax policy analysis of the statutory exclusions is difficult
because data are sparse and the support is based on testimonials.
Nonetheless, the dramatic lowering of U.S. tax rates and the limited
number of educators electing Section 911 suggest a trivial cost
for this tax expenditure, notwithstanding its violation of equity
and neutrality standards.
Enhancing the Tax Learning
Experience: Identifying and Using Tax Cases in Introductory Courses
Ken Milani and Kevin M. Misiewicz
Cases offer students an opportunity to experience
how the tax laws work in a variety of actual situations. Moreover,
when carefully selected, cases stimulate student interest and
facilitate learning in important subject areas. This article presents
a framework for evaluating the merit of a particular case for
use in the classroom. It also suggests and summarizes several
cases for potential use.
The Evolution of the ATA:
From Orphans, to Outlaws, to Respectability
D. Larry Crumbley
The American Taxation Association (ATA) was created
in 1974 because a number of individuals felt that tax members
were having little impact on the American Accounting Association
(AAA). ATA was created to coordinate efforts involving issues
in tax education, tax research, and tax legislative matters. In
only thirteen years, the organization has had a significant impact
on the academic and professional activities of tax instructors
and on the direction of AAA. Although three of its original objectives
are being met, ATA has not had a major impact on the tax legislative
process nor any interlinking with other academic disciplines.