The main purpose of this study is to develop a bankruptcy prediction model for the small business firm. Data was collected from the Dallas Small Business Administration (SBA), making this study specific to its decision makers. Existing research has produced models which predominately use financial ratios and information measures either independently or combined, and a few research models have used economic trends. This study varies from past studies in that it includes regional economic variables from the states of Texas. A sample of three-year data for 138 firms included fifteen bankrupt firms. This proportion of bankrupt/nonbankrupt firms approximates the proportion of repayed/defaulted loans in the SBA. Stepwise regression, set at the .15 level of significance, reduced a total of fifty-three variables to nine. These nine variables were then used to test twelve predictive models. All twelve models tested improved the SBA repayment rate and only two of the twelve would have caused the SBA to deny loans to applicants who eventually repaid. The study determined the model that included financial ratios, information measures, and Texas economic variables as best. It was also demonstrated that some of the variables used in this model could be eliminated without decreasing the predictive power …

The step transaction doctrine is one of the judicial doctrines used by the courts to interpret tax law. The doctrine requires that a series of transactions be treated as a single transaction if the transactions share a single, integrated purpose. Many authors believe there is a great deal of uncertainty as to when the doctrine will be applied. Uncertainty and inconsistency in the application of tax law add to the complexity of the law. One of the most complex areas of tax law is Subchapter C of the Internal Revenue Code, which governs corporate formations, redemptions, liquidations, distributions, and reorganizations. The purpose of this study was to determine if the step transaction doctrine is being consistently applied by the Tax Court and what variables affect the judges' decision in these cases. Hierarchical logit analysis was used to derive a full model and two restricted models. The full model was used to determine the predictive power of the variables that were identified and to explain the extent to which the individual variables affect the judges' decisions. One restricted model was used to test temporal stability. The other was used to test consistency when different issues of tax law are involved. The …

Private philanthropy is important in America. In 1985, philanthropy totaled almost 80 billion dollars. Philanthropy is partially a function of price. Absent a tax benefit, the price of charitable giving is unity. When tax benefits are available, the price of cash giving is one minus the marginal tax rate of the donor. Philanthropy is not evenly distributed among all classes of organizations. Changes in tax cost bring about changes in the distribution of gifts among organizations. Predictions have been made of a six to twelve billion dollar decline in individual giving as a result of the Tax Reform Act of 1986. The question is, "Whose ox gets gored?" In 1962, the Internal Revenue Service collected data directly linking itemized charitable contributions to class of donee organization. Prior works by Taussig, Schwartz, Feldstein, and Clotfelter have been principally based on this data. Their works document differing elasticities of price on charitable giving. The current research gathered 1985 data on the relationships between income, price, and charitable donee for 298 Dallas County, Texas, taxpayers. Data was obtained from selected certified public accountants in Dallas County who prepared income tax returns for individuals as part of their practice. Two hundred fifty usable responses …

The purpose of this study was an empirical investigation of the factors considered by the United States Tax Court in determining whether the principal purpose for an acquisition was tax avoidance (or alternatively, given the totality of the surrounding circumstances, whether there was an overriding business purpose for the acquisition).