TWO BIRDS WITH ONE STONE: TAX BREAKS FOR JURORS TO INCENTIVIZE PARTICIPATION

            The jury system—especially from the perspective of the juror—is riddled from top to bottom with problems.  For a fractional view of the problems with the jury system click here.

In the eyes of the juror, one major problem is lack of compensation.  Jurors are usually paid a nominal rate on the first day of service.  Compensation for the first day of service can range from eight to sixteen dollars.  Yet, jurors must often make arrangements that cost well in excess of the minimal first day rate (i.e. hiring a baby sitter); and, in some counties, jurors must pay their own parking without even a discount in their parking fee.  After the first day, jurors are usually paid a much higher rate—typically between thirty or fifty dollars.  But, that still falls extremely short of “compensating” jurors for their time—especially considering most jurors make more than fifty dollars a day.  And, even though jurors are paid these low rates relative to their respective incomes, jurors are still required to pay income tax on their compensation because it is “compensation for services” under the Tax Code.  For further discussion, click here.  Forcing jurors to pay this tax decreases the attractiveness of an already less-than-attractive juror compensation.

On the other hand, the government struggles with two major problems.  First, juror turn out is typically very low—far below one hundred percent, which would be ideal.  Typically, juror turn out is well below fifty percent.  Second, the government has very limited resources.  As much as the government would like to pay every juror a handsome fee for serving on a jury, the government simply has a limited number of resources by which to compensate jurors.  And, because the courts need such a large number of jurors, the government must spread its limited resources rather thin to every juror at least some type of compensation.

Providing jurors with a tax deduction or exclusion might actually incentivize jurors to arrive at jury duty, as opposed to appear out of fear of punishment, and not require the government to come out of pocket.  A juror tax break might also reduce the cost on the government in paying out juror compensation—such as reducing accounting costs and cost of paper incurred in issuing physical checks.  Admittedly, a tax break would reduce the government’s income, but the government may be able to maintain the financial status quo and still incentivize juror turn out simply by changing the form of compensation to a tax break.  For example, if jurors receive a $100 tax deduction for each day of jury service, a juror might actually receive less compensation (given the tax bracket) but might believe he or she is being compensated at a higher rate because receiving $100 sounds more attractive than receiving $40 or $50.  Also, because operating costs are reduced (accounting costs and paper costs), the government might be able to increase actual juror compensation by offering a higher deduction or exclusion—such as a $200 or $250 tax deduction, which sounds even more appealing than only $40 dollars a day of taxable income.

This idea does give rise to numerous other issues (such as what to do with jurors with no gross income), but it might be an idea worth exploring because jurors have no incentive whatsoever to arrive for jury duty, other than the fear of punishment.  This idea may change jury duty from an obligation citizens must do to a privilege that citizens get to do.