patent tax privileges/fraud

[PILCH Hartmut <phm@a2e.de>]

GregNews (http://swpat.ffii.org/players/aharonian/) reports, among others:

<<

Last year Congress passed a law changing the tax code so that companies
donating patents could only deduct amounts proportionable to their
legal costs acquiring the patent and a percentage of any profits earned
by the recipient of the patent, which in most cases probably totals up
to diddly-squat, i.e., little to nothing.  Congress passed this reform
based on reports of companies claiming outrageous values for their
donated patents (like the anti-virus patent SBC donated to UTexas for a
claimed value of $7 million, when it was worth nothing, which I mentioned
in a PATNEWS).

The 17 October issue of Forbes, page 56, has an article titled "Clunker
Patents", reporting on how the IRS is examining past donations of patents
and finding more examples of outrageously valued patent donations.   The
IRS has already disallowed $1 billion, I repeat, ONE BILLION DOLLARS, in
claimed patent donation deductions, and is examining another $4.7 billion
worth of deductions (most of which I suspect will also be disallowed).
Anyone know if I can file a FOIA to get a list of the disallowments?

[...]

Fortunately, as of June 2004, all donations have to be treated honestly, so
much of this fraud will be going away.  Still, I have to ask because I am
such a bore, where the heck were "professional" groups like the ABA, AIPLA,
IPO when all of this patent donation fraud was going on?

[...]

>>

Some info about tax aspects of patents has been collected on

        http://wiki.ffii.org/SwpatctekiEn
        http://swpat.ffii.org/analysis/tax/

In Europe currently tax privileges for patents are once more on the rise.
The Italian government recently, as part of its latest budget (Legge
Finanziaria), proposes what the minister in charge, Guilio Tremonti, called
and "end to the taxation of the brain", meaning emulation of the Irish
practise of charging no tax on patent royalty revenues.  This was quite
conspicuous, given that Italy is suffering greatly from a shortage of
revenues and the opposition is using every opportunity to shoot at a 
government
which in many ways seems instable and which has to hurt a lot of people by
cutting public spending.

--
Hartmut Pilch, FFII.org, Munich Office +498918979927, Brussels +3227396262
Protect Innovation, not Monopolies       http://www.economic-majority.com/