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TAX PROFESSORS WEIGH IN ON MURPHY

July 06, 2007

The Tax Prof has rounded up learned opinion on this week's new Murphy decision (update: link fixed). Bryan Camp of Texas Tech focuses on something I had noticed: how the court blames the government's attorneys for the initial bad opinion.

I read the opinion as a HUGE CYA and nothing more. I think this paragraph is of signal importance to understanding why the opinion reads as it does:

Murphy appealed the judgment of the district court with respect to her claims under § 104(a)(2) and the Sixteenth Amendment. In Murphy v. IRS, 460 F.3d 79 (2006), we concluded Murphy's award was not exempt from taxation pursuant to § 104(a)(2), id. at 84, but also was not "income" within the meaning of the Sixteenth Amendment, id. at 92, and therefore reversed the decision of the district court. The Government petitioned for rehearing en banc, ARGUING FOR THE FIRST TIME, even if Murphy's award is not income, there is no constitutional impediment to taxing it because a tax on the award is not a direct tax and is imposed uniformly. In view of the importance of THE ISSUE THUS BELATEDLY RAISED, the panel sua sponte vacated its judgment and reheard the case. ...[self-serving cites omitted]...In the present opinion, we affirm the judgment of the district court BASED UPON THE NEWLY ARGUED GROUND that Murphy's award, even if it is not income within the meaning of the Sixteenth Amendment, is within the reach of the congressional power to tax under Article I, Section 8 of the Constitution.

I love his conclusion:

If I'm reading this right, it is not a satisfactory opinion at all, with all its dodging and weaving and sanctimonous crapola about the government raising a "new" argument.

Is "crapola" a legal term?

Link: Complete Tax Update Murphy Coverage.

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