Hester Prynne, Lydia Bennet, and Section 306 Stock: The Concept of Tainting in the American Novel, the British Novel, and the Internal Revenue Code

摘要

Did Nathaniel Hawthorne\u27s novel, The Scarlet Letter, inspire Section 306 of the Internal Revenue Code? This code provision adopts a peculiarly Hawthorne-like solution to a tax avoidance scheme known as the \u22preferred stock bailout.\u22 Section 306 taints the stock used in the scheme as \u22Section 306 stock.\u22 Special rules then govern all subsequent dispositions of the tainted stock. With its concept of a taint that can dog a stock from acquisition to disposition, Section 306 might have been designed by a novelist rather than a tax technician.