TAXING POLICE BRUTALITY BONDS

In view of decades of devastating police violence and efforts to reform policing, this Note points to two concurrent phenomena that result in the federal tax code granting benefits to the wealthiest taxpayers who lend to municipalities for police brutality settlements. The first phenomenon is cities electing to issue bonds to satisfy these costly payouts. These bonds have been coined "police brutality bonds." The second phenomenon is the tax benefit to investors in the top tax brackets for collecting interest from municipal bonds-compared to like private bonds. This Note argues that the federal tax code should not allow wealthy taxpayers to receive tax benefits from funding police brutality bonds. Further, since tax exemption of municipal bonds is a form of federal subsidy, this Note argues that a federal subsidy for police brutality bonds is inappropriate given the legislative intent and economic justification behind tax exemption.