Punishing the Victim: IRC §162(m) and the Limitation on Deducting Executive Compensation

(Source) The phenomenon of punishing the victim is unfortunately a familiar one. Too often, a person in need of protection discovers that those whose ostensible task it is to assist not only do not offer the necessary protection but in fact exacerbate the harm. Here is a current example. Section 162(m) of the Internal Revenue Code provides that a publicly held corporation may not deduct compensation in excess of $1,000,000 paid to its principal executive office, its principal financial officer, or any of its three other most highly compensated employees (if the compensation paid to that employee is required to be reported to its shareholders under the Securities Exchange Act of 1934). Until 2017, IRC §162(m) was fairly easy to avoid as it did not apply to performance-based compensation: bonuses, stock options, and so forth. However, the 2017 Tax Cuts and Jobs Act eliminated this escape route. Today, regardless of how the compensation package is structured, the corporation can deduct a maximum of $1,000,000 for each of its covered employees. Underlying IRC §162(m) is the concern that the entrenched power of corporate management and the lack of effective oversight foster excessive executive compensation. The issue addressed by this provision is [read more]

Is There a Way Out of the U.S. Military if You Morally Object to Your Job?

(Source)   On January 3, 2020, so many people visited the Selective Service webpage that it crashed. The crash came hours after the announcement that Quasem Soleimani was killed by a U.S. airstrike ordered by President Donald Trump. In light of threats of a World War III and fear of a looming draft, the hashtag #WorldWarIII was one of the top trends on Twitter that day. Operated under the United States government, the Selective Service System’s mission is “[t]o register men and maintain a system that, when authorized by the President and Congress, rapidly provides personnel in a fair and equitable manner while managing an alternative service program for conscientious objectors.” In January, the Selective Service webpage read in red, “THERE IS NO MILITARY DRAFT.” While the possibility of another world war frightens many U.S. citizens, beliefs about war prior to service are taken seriously in most instances. However, beliefs about war that are the result of military-linked experiences are more complex. Ignoring the possibility of a draft, which does not appear to be coming, what happens when an individual freely signs a contract with the military and then changes their mind, claiming to be a conscientious objector? Current military [read more]

Are the FTC’s Regulations of Social Media Influencers Sufficient?

Using celebrities to sell products is hardly a new or innovative practice. Throughout time, celebrities have endorsed almost every product imaginable, from clothing and makeup to cars, credit cards, food, and even milk. This practice has been so consistent over time because, put simply, it is effective: brands are willing to spend whatever it takes to get the sales boost that typically comes with a celebrity partnership. Social media is extremely prevalent in today’s society (the average person spends about two hours a day, or up to nine hours a day for teens, on social media). As a result, social media advertising through influencers (individuals that have the ability to impact an audience’s behavior through their social media posts, such as bloggers and celebrities) tends to be a highly effective way to for brands to interact with their customers. It makes sense that brands are moving their product endorsements from traditional media outlets to the social media world. Consumers put a significant amount of information about themselves onto social media sites, which allows for very specific tailoring of content to individual consumers. Further, social media advertising tends to be less expensive than traditional advertising channels. According to Liz Dunn, founder [read more]

Trump’s Muslim Immigration Ban – Concerning but Likely Constitutional

President Trump has recently signed an executive order, titled “Protecting the Nation from Terrorist Attacks by Foreign Nationals,” that restricts visits and immigration from seven Muslim-majority countries: Iraq, Libya, Somalia, Sudan, Syria, Yemen, and Iran. Trump’s executive order has sparked widespread protest and backlash from Muslim support groups, and has routinely been characterized as “racist.” Some critics of the executive order argue that the immigration ban targeting solely Muslim-majority countries is unconstitutional. Current United States law and court cases, however, grant the President broad authority to restrict immigration from particular countries. In the decades following the ratification of the Constitution, the Supreme Court determined that the Legislative Branch and the Executive Branch had “plenary power”—absolute power— over issues concerning immigration. Since then, Congress has given away much of its shared plenary power over immigration to the Executive Branch. For example, Congress delegated to the Executive Branch the power to determine whether foreigners should be granted temporary protected status, whether a person is permitted to work in the United States, whether a person’s deportation should be deferred, and whether to grant a person permission to be in the United States when the person does not qualify for a visa. Despite the [read more]

Animal Advocacy During The Trump Administration

Many animal advocates opposed the election of Donald Trump.  The Humane Society called a Trump presidency “a threat to animals everywhere.” Kathleen Parker, a columnist for the Washington Post, warned of Trump’s “anti-animal animus.” The reality is more nuanced. While Trump seems likely to roll back some legal protections for animals, the change in administration might also create new opportunities for animal advocates. First, the bad news. The Trump administration seems less interested than its predecessors in enforcing animal cruelty laws. For example, on Thursday, February 2, the U.S. Department of Agriculture abruptly took down its webpage publicizing investigations of animal abuse. This move seems to signal a less zealous approach to enforcement by the USDA’s Animal and Plant Health Inspection Service. The new stance is not surprising given Trump’s earlier tolerance of animal cruelty by Ringling Brothers’ Circus. A second cause for concern is the Trump administration’s goal of empowering states to regulate wildlife currently covered by the Endangered Species Act. Several state officials have declared that they would reduce populations of wolves and other predators if permitted to do so by the federal government. On January 17, a federal judge blocked the state of Idaho from using telemetry [read more]
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