Using a hand-collected sample of U.S. multinational firms’ foreign and domestic cash holdings, we evaluate the earnings persistence implications of changes in foreign and domestic cash and whether stock prices reflect such implications. Building on the earnings decomposition approach in...

This study examines whether firm-specific tax policy uncertainty (TPU) influences corporate investment decisions. Investment theory predicts that with uncertain project cash flows, firms should elect to delay committing to investments. Consistent with this prediction, we find that TPU deters...

We examine the effects of the July 2021 expansion of the Child Tax Credit (CTC). We analyze detailed transactions data for 2019 through September 2021, utilizing a difference-in-differences design, and controlling for state-time specific conditions. We find that recipients of expanded CTC...

In this study, we provide evidence on the deterrence effects of state tax whistleblower laws. We exploit a novel 2010 amendment to New York’s False Claims Acts that explicitly extended whistleblower incentives to corporate income tax whistleblowers. We identify treated firms (firms exposed to...

In a broad sample of publicly traded firms over the period 1988−2017, we observe that the share of firms reporting pre-tax book losses increased from about 20 to 35%. Of those loss firms, on aver-age 68% have positive cash tax payments (taxpaying loss firms). The amount of taxes paid by these...

When reporting after-tax non-GAAP earnings, firms are required to adjust for the tax effects of exclusions. Since 2010, the SEC has issued and updated Compliance and Disclosure Interpretations (hereafter, C&DIs) which specifically require firms to disclose the tax effects of exclusions. We...

We examine whether employee perceptions of managers and firms fall following tax avoidance news. Using S&P 500 firms and generalized difference-in-differences specifications, we find that tax avoidance news negatively affects employee perceptions of managers and firms. In cross-sectional tests,...

We argue that political connections help financially constrained firms access external financing and consequently reduce their incentives to use tax planning as a source of internal financing. Consistent with this argument, we find that after a plausibly exogenous increase in political...

Employee turnover is a significant cost for businesses and a key human capital metric, but firms do not disclose this measure. We examine whether turnover is informative about future firm performance using a large panel of turnover data extracted from employees’ online profiles. We find that...