Document Type
Article
Publication Date
10-27-2008
Publication Title
State Tax Notes
Publication Title (Abbreviation)
St. Tax Notes
Volume
50
First Page
239
Last Page
242
Abstract
In the interpretation of tax statutes, a venerable principle is that “taxation should move in an atmosphere of practical realities rather than amid the intricate and wooden concepts” of legal formalities. That principle is familiar in federal taxation, and it holds no less sway in state and local taxation. Indeed, the idea that the substance of a transaction usually controls over the form of the transaction is not confined to taxation; it is a principle of U.S. law generally.
The principle commands that the underlying reality of the events usually determines tax consequence; the forms or labels attached to the events by the parties themselves (by contract or otherwise), or even by nontax law usually, are not determinative. This column will explore the “substance versus form” rule from three perspectives: justification for the rule, the reach of the rule and examples of its application in state and local taxation, and use of the rule in favor of taxpayers.
Rights
© 2008 Steve R. Johnson
Faculty Biography
http://www.law.fsu.edu/our-faculty/profiles/johnson
Recommended Citation
Steve R. Johnson,
Substance and Form in State Taxation, 50
St. Tax Notes
239
(2008),
Available at: https://ir.law.fsu.edu/articles/317
Comments
First published in State Tax Notes.