Now that the scurrying around and worrying relative to developments impacting the Corporate Transparency Act (“CTA”) that were coming at us with laser speed are on a slow simmer, I can turn my attention back to my multi-part...more
4/4/2025
/ Business Losses ,
Business Ownership ,
Change of Ownership ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Ownership Interest ,
S-Corporation ,
Shareholders ,
Tax Code ,
Tax Credits ,
Tax Deductions ,
Tax Liability ,
Tax Planning ,
Tax Returns ,
Treasury Regulations
In this Part XV of my multi-part series on some of the not-so-obvious aspects of Subchapter S, I explore a potential advantage that the S corporation has over the C corporation.
The Patient Protection and Affordable Care...more
In this Part XIV of my multi-part series on some of the not-so-obvious aspects of Subchapter S, I explore a narrow aspect of Subchapter S that is often ignored or forgotten. An S corporation is not always a mere extension of...more
Basic Rules -
IRC § 6501(a) generally requires the IRS to assess tax within three (3) years after a tax return is filed by the taxpayer.
There are two (2) notable exceptions to this rule under IRC § 6501(c) and (e),...more
In this Part XII of my multi-part series on some of the not-so-obvious aspects of S corporations, I explore a consistent theme – taxpayers lose fights with taxing authorities when they fail to maintain adequate records....more
10/16/2024
/ Business Records ,
Failure To Maintain ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Joint Tax Returns ,
Recordkeeping Requirements ,
S-Corporation ,
Tax Court ,
Tax Credits ,
Tax Planning ,
Treasury Regulations
In this Part XI of my multi-part series on some of the not-so-obvious aspects of S corporations, I explore a topic that should be obvious but which appears to be ignored by many taxpayers and their tax advisers – accurate...more
When considering converting a C corporation to an S corporation, tax advisers and taxpayers need to pay careful attention to the many perils that exist. Failure to pay close attention to the road in this area could result in...more
8/21/2024
/ C-Corporation ,
Capital Gains Tax ,
Corporate Conversions ,
Corporate Taxes ,
Income Taxes ,
Internal Revenue Code (IRC) ,
Passive Activity ,
S-Corporation ,
Shareholder Distributions ,
Shareholders ,
Tax Planning
Unlike the rules contained in Subchapter K surrounding partnership distributions, which tend to be somewhat complex, the distribution rules contained in Subchapter S are fairly straightforward. Nevertheless, from time to...more
In the S corporation arena, tax advisors and taxpayers generally do not focus a lot of attention on the S corporation shareholder eligibility rules other than at the time the S election is made. As we dive into shareholder...more
In the S corporation arena, tax advisors generally do not focus much attention on unreasonable compensation. As we delve into the issue in this Part VII of my multi-part series on Subchapter S, it will become apparent that...more
6/6/2024
/ C-Corporation ,
Compensation ,
Corporate Taxes ,
Income Taxes ,
Internal Revenue Code (IRC) ,
Payroll Taxes ,
S-Corporation ,
Shareholders ,
Tax Deductions ,
Tax Liability ,
Tax Planning ,
Tax Rates
This sixth installment of my multi-part series on Subchapter S is focused on the revocation of an S corporation election. While the rules relating to revocation are fairly straightforward, there are a few nuances that may...more
This fifth installment of my multi-part series on Subchapter S is focused on married individuals who own shares of an S corporation. While the rules relating to shareholder eligibility seem straightforward, their application...more
This fourth installment of my multi-part series on Subchapter S is focused on suspended losses of an S corporation. While the rules seem straightforward, their application can be tricky, especially given legislative changes...more
This third installment of my multi-part series on Subchapter S is focused on a single Code Section, namely IRC Section 1361(b)(1)(C) and the ineligibility of nonresident aliens as shareholders of Subchapter S corporations....more
This second installment of my multi-part series on Subchapter S is focused on two Code Sections, namely IRC Section 1375 and IRC Section 1362(d)(3)....more
In October 2023, I authored a new White Paper, A Journey Through Subchapter S / A Review of The Not So Obvious & The Many Traps That Exist For The Unwary. This year, in a multi-part article, I intend to take our blog...more
More than two decades ago, the Service announced its intention to consider simplifying the entity classification rules in Notice 95-14. It stated:
“The Internal Revenue Service and the Treasury Department are considering...more
11/10/2022
/ Business Entities ,
Check the Box Rules ,
Entity Classification ,
Income Taxes ,
IRS ,
Limited Liability Company (LLC) ,
Partnerships ,
S-Corporation ,
Tax Liability ,
Tax Planning ,
U.S. Treasury
On November 19, 2021, HR 5376, the 2,476-page bill, commonly known as the Build Back Better Act, was passed by the U.S. House of Representatives by a vote of 220-213.
The House’s vote on HR 5376 was held after the...more
Last fall, the IRS announced, with respect to pass-through entities (LLCs or other entities taxed as partnerships or S corporations), that, if state law allows or requires the entity itself to pay state and local taxes (which...more
11/3/2021
/ Business Taxes ,
Corporate Taxes ,
Income Taxes ,
IRS ,
Local Taxes ,
Oregon ,
Partnerships ,
Pass-Through Entities ,
S-Corporation ,
SALT ,
State and Local Government ,
State Taxes ,
Tax Deductions ,
Tax Liability ,
Tax Planning ,
Tax Rates
On April 17, 2019, Treasury issued its second installment of proposed regulations relating to Qualified Opportunity Zones (“QOZs”). The regulations are 169 pages in length, and (as suspected) are fairly complex. Nevertheless,...more
4/24/2019
/ Anti-Abuse Rule ,
Asset Management ,
Capital Gains ,
Holding Periods ,
Income Taxes ,
Internal Revenue Code (IRC) ,
Investors ,
IRS ,
Opportunity Zones ,
Original Use ,
Partnerships ,
Proposed Regulation ,
Qualified Opportunity Funds ,
Real Estate Transactions ,
S-Corporation ,
Safe Harbors ,
Tangible Property ,
Tax Benefits ,
U.S. Treasury
The Service issued proposed regulations corresponding to IRC § 199A yesterday. As discussed in a prior blog post, IRC § 199A potentially allows individuals, trusts and estates to deduct up to 20% of qualified business income...more
8/9/2018
/ Anti-Abuse Rule ,
Business Income ,
Business Ownership ,
Business Taxes ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Limited Liability Company (LLC) ,
Partnerships ,
Pass-Through Entities ,
Proposed Regulation ,
S-Corporation ,
Sole Proprietorship ,
Tax Cuts and Jobs Act ,
Tax Deductions ,
Tax Planning
As we have been discussing these past several weeks, the Tax Cuts and Jobs Act (“TCJA”) drastically changed the Federal income tax landscape. The TCJA also triggered a sea of change in the income tax laws of states like...more
The Tax Cuts and Jobs Act (“TCJA”) will significantly impact merger and acquisition (“M&A”) activity. Although billed as tax reform, the TCJA did not reform or simplify the Internal Revenue Code (“Code”).
Virtually none of...more
4/9/2018
/ Acquisitions ,
Alternative Minimum Tax ,
Commercial Real Estate Market ,
Controlled Foreign Corporations ,
Corporate Taxes ,
EBITDA ,
Foreign Acquisitions ,
Foreign Corporations ,
International Tax Issues ,
Mergers ,
Net Operating Losses ,
S-Corporation ,
Section 1031 Exchange ,
Tax Cuts and Jobs Act ,
Tax Deductions ,
Tax Reform
“Neither a borrower nor a lender be...” or at least, if you insist on borrowing (and we understand the appeal), we are here to help you stay abreast of the new rules on deducting interest.
BACKGROUND/PRIOR LAW -
Interest...more
2/7/2018
/ Borrowers ,
Business Expenses ,
Business Taxes ,
C-Corporation ,
Carry Forward ,
Carve Out Provisions ,
Corporate Taxes ,
Debt ,
EBITDA ,
Income Taxes ,
Internal Revenue Code (IRC) ,
Investment ,
IRS ,
Lenders ,
Net Operating Losses ,
Partnerships ,
Pass-Through Entities ,
S-Corporation ,
Shareholders ,
Small Business ,
Tax Cuts and Jobs Act ,
Tax Deductions ,
Tax Planning ,
Taxable Income ,
Termination
BACKGROUND -
The Tax Cuts and Jobs Act (“TCJA”) adopted a new 20% deduction for non-corporate taxpayers. It only applies to “qualified business income.” The deduction, sometimes called the “pass-through deduction,” is...more
1/30/2018
/ Business Income ,
Business Taxes ,
C-Corporation ,
Compensation ,
Deduction Limitations ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Landlords ,
Limited Liability Company (LLC) ,
Pass-Through Entities ,
Property Owners ,
S-Corporation ,
Shareholders ,
Tax Cuts and Jobs Act ,
Tax Deductions ,
Tax Penalties ,
Tax Reform ,
Threshold Requirements ,
Trump Administration ,
W-2 ,
Wage and Hour