Recent Decisions Affecting Tax Neutralization in California: Clemens, Economy, and Barber

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Barry Ben-Zion. 2021. Recent Decisions Affecting Tax Neutralization in California: Clemens, Economy, and Barber. Journal of Legal Economics 27(1): pp. 43–51.

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This paper focuses on three recent cases concerning legal guidance in California for the application of tax neutralization in employment cases. The paper provides a brief discussion of the history of legislation, legal acceptance, and the forensic economic literature which arose to deal with the need to neutralize the adverse tax consequence of lump-sum awards in employment and other non-physical injury cases. It includes a simplified illustration of the calculations that would be required to achieve neutralization. It ends with a discussion of the specific cases that bring acceptance of the concept of tax neutralization to California (Clemens and Economy) as well as an exception that applies to state employees (Barber).

Authors

Barry Ben-Zion

Publication Year

2021