re: Make tax code friendlier to stop business inversion? Surely you jest

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The link to the first page of the study notes that the benchmark was 1984 and 1989. TFA of 1986 was the primary factor of the income shift.

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The most significant revisions, expanding the definition of AGI, came in the Tax Reform Act of 1986 (TRA86). Among these revisions were the full inclusion of long-term capital gains (previously, 40 percent was included in the AGI, and before 1979, 50 percent had been included). TRA86 also imposed limits on "passive losses" that would be allowed in calculating AGI. It changed moving expenses and unreimbursed employee business expenses from income "adjustments" to itemized deductions.

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The Economic Recovery Tax Act of 1981 (ERTA) and TRA86 both substantially revised the depreciation schedules, with ERTA liberalizing the deductions and TRA86 tightening them. Consequently, a given amount of business profits (as measured for the company’s records) contributed less to AGI in the early 1980s than it did after 1986.

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