State & Local

The Tax Angle: IRS Funding, Budget Markup, Insurance Woes

Stephen K. Cooper
Editor-at-Large

From a look at upcoming Senate hearings on President Donald Trump's funding plans for the IRS to a potential markup of Republicans' $3.8 trillion budget reconciliation bill and the continuing crisis in homeowner insurance, here's a peek into a reporter's notebook on a few of the week's developing tax stories.

Senate May Clash With House On SALT Cap, Energy Credits

Asha Glover

Senate Republicans are working to finalize the chamber's version of the House's nearly $4 trillion tax bill, and the Senate's bill is likely to conflict with the House's over proposed changes to the state and local tax deduction and green energy credits.

State & Local Tax Takeaways From May

Maria Koklanaris
Senior Tax Correspondent

Many states, looking at a new fiscal year starting in July, finalized their budgets in May, with significant tax implications for individuals and businesses. New York will reduce income taxes on lower- to middle-income taxpayers. In Washington state, several measures intended to close a $16 billion shortfall include an expansion of the sales tax to digital advertising. Here, Law360 presents these and other state and local tax developments to know from the past month.

Section 899 Could Be A Costly Tax Shift For US Borrowers

Intended to deter foreign governments from applying unfair taxes to U.S. companies, the proposal adding new Section 899 to the Internal Revenue Code would more likely increase tax burdens on U.S. borrowers than non-U.S. lenders unless Congress limits its scope, says Michael Bolotin at Debevoise.

Calif. Bar Exam Fiasco Shows Why Attys Must Disclose AI Use

The recent revelation that a handful of questions from the controversial California bar exam administered in February were drafted using generative artificial intelligence demonstrates the continued importance of disclosure for attorneys who use AI tools, say attorneys at Troutman.

Del. Corporate Law Rework May Not Stem M&A Challenges

While Delaware's S.B. 21 introduced significant changes regarding controllers and conflicted transactions by limiting what counts as a controlling stake and improving safe harbors, which would seem to narrow the opportunities to challenge a transaction as conflicted, plaintiffs bringing shareholder derivative claims may merely become more resourceful in asserting them, say attorneys at Debevoise.

In 2nd Place, Va. 'Rocket Docket' Remains Old Reliable

The U.S. District Court for the Eastern District of Virginia was again one of the fastest civil trial courts in the nation last year, and an interview with the court’s newest judge provides insights into why it continues to soar, says Robert Tata at Hunton.

Getting One Right: SALT In Review

From a New York taxpayer's victory on appeal to a proposed administrative change in Louisiana, RSM's David Brunori offers his thoughts on noteworthy state and local tax news.

How Attorneys Can Become Change Agents For Racial Equity

As the administration targets diversity, equity and inclusion efforts and law firms consider pulling back from their programs, lawyers who care about racial equity and justice can employ four strategies to create microspaces of justice, which can then be parlayed into drivers of transformational change, says Susan Sturm at Columbia Law School.

Adapting To Private Practice: From US Attorney To BigLaw

When I transitioned to private practice after government service — most recently as the U.S. attorney for the Eastern District of Virginia — I learned there are more similarities between the two jobs than many realize, with both disciplines requiring resourcefulness, zealous advocacy and foresight, says Zach Terwilliger at V&E.

The Ins And Outs Of Consensual Judicial References

As parties consider the possibility of judicial reference to resolve complex disputes, it is critical to understand how the process works, why it's gaining traction, and why carefully crafted agreements make all the difference, say attorneys at Pillsbury.

The BigLaw Settlements Are About Risk, Not Profit

The nine Am Law 100 firms that settled with the Trump administration likely did so because of the personal risk faced by equity partners in today's billion‑dollar national practices, enabled by an ethics rule primed for modernization, says Adam Forest at Scale.

Power To The Paralegals: An Untapped Source For Biz Roles

Law firms looking to recruit legal business talent should consider turning to paralegals, who practice several key skills every day that prepare them to thrive in marketing and client development roles, says Vanessa Torres at Lowenstein Sandler.

When Even A Judge Feels Defeated: SALT In Review

From a split decision in a New York state court to a Louisiana plan to funnel tax dollars to student-athletes, RSM's David Brunori offers his thoughts on noteworthy state and local tax news.

$38M Law Firm Settlement Highlights 'Unworthy Client' Perils

A recent settlement of claims against law firm Eckert Seamans for allegedly abetting a Ponzi scheme underscores the continuing threat of clients who seek to exploit their lawyers in perpetrating fraud, and the critical importance of preemptive measures to avoid these clients, say attorneys at Lockton Companies.

Evolving Federal Rules Pose Further Obstacles To NY LLC Act

Following the Financial Crimes Enforcement Network's recent changes to beneficial ownership information reporting under the federal Corporate Transparency Act — dramatically reducing the number of companies required to make disclosures — the utility of New York's LLC Transparency Act becomes less apparent, say attorneys at Pillsbury.