Louis Vlahos on C-Corporation

Tax Considerations and the Reclassification of Marijuana – We’re Not There Yet

Having been swept along for nine days “by the force of the hostile winds on the fishy sea,” Odysseus and his crew came to a strange land. After securing their ships, Odysseus sent some of his “companions ahead, telling them...more

7/18/2024 / Agribusiness , C-Corporation , Cannabis Products , Controlled Substances , Controlled Substances Act , DEA , Decriminalization of Marijuana , Drug Trafficking , Illegal Activity , Income Taxes , IRS , Marijuana , Marijuana Related Businesses , Plant Based Products , Recreational Use , S-Corporation , Schedule I Drugs

The Supreme Court’s Non-Opinion On The “Realization” of Income – A Lost Opportunity?

In less than four months, the citizens of the United States will be electing their next President to a four-year term. They will also be deciding which of the two major political parties will “control” the Senate, the House,...more

7/11/2024 / Apportionment , C-Corporation , Conservatives , Controlled Foreign Corporations , Foreign Corporations , IRS , Moore v US , Partnerships , Pass-Through Entities , Presidential Elections , Repatriation , S-Corporation , SCOTUS , Shareholders , Sixteenth Amendment , Tax Cuts and Jobs Act , Tax Deferral , Tax Liability , Term Limits

The Family Business – Compensating Family-Employees

Hope you had a good Thanksgiving Holiday. Some of us probably feel we ate or drank either too much or not enough, watched too much or not enough football, or spent too much time discussing politics and the state of the...more

Debtor Corp’s S Election: “Property” in Bankruptcy?

Uncertain Future- The Congressional Budget Office (“CBO”) recently released some data for the federal government’s 2023 fiscal year. According to the CBO, the federal budget deficit for the year was $1.7 trillion, or...more

ESBTs and the Carryover of S Corporation Losses

Since 1995 to the present, the LLC has emerged as the entity of choice for the vast majority of entrepreneurs. This form of business entity owes its success to the flexibility and to the tax benefits that it affords its...more

9/22/2023 / Beneficiaries , C-Corporation , Capital Gains , Entrepreneurs , Federal Taxes , Limited Liability Company (LLC) , Net Operating Losses , Reasonable Compensation , S-Corporation , Shareholders , Small Business , Tax Liability , Trusts

Pre-Consolidation Conversions in the Accounting World – Tax Considerations

Another Change- Last week BDO confirmed that it was going to convert from an entity organized as a limited liability partnership under state law to one organized as a corporation. With that, BDO became the latest in a...more

Some Observations On Recent Conversions of Partnerships to “C” Corporations

Decisions- It is often the case that the optimal form of legal entity through which a business should operate, at least for income tax purposes, will depend in part upon the stage of its life cycle in which the business...more

6/20/2023 / Acquisitions , C-Corporation , Federal Taxes , Investors , Limited Liability Company (LLC) , Liquidation , Partnerships , Pass-Through Entities , Reinvestment Funds , Shareholders , State Taxes , Tax-Free Transfers , Taxable Income

The President’s 2024 Federal Budget: “Reforming” the Taxation of High-Income Taxpayers

The Budget and Accounting Act of 1921 established the requirement that the President submit a budget to Congress for the upcoming fiscal year. Among other things, the proposed federal budget affords the President an...more

3/13/2023 / C-Corporation , Capital Gains , Estate Tax , Federal Budget , Gift Tax , Grantor Retained Annuity Trusts (GRATs) , Grantor Trusts , IRS , Joe Biden , NIIT , S-Corporation , Tax Deferral , Tax Increases , Tax Rates

Private Foundations, Closely Held Businesses, And Distribution Requirements

“Show Me the Money”- Much has been written in recent months about how well the investment portfolios of private foundations have performed over the last several years. For example, a study conducted by the Council on...more

10/12/2022 / Bipartisan Budget Act , Business Income , C-Corporation , Charitable Organizations , Closely Held Businesses , Distribution Rules , Donor-Advised Funds (DAFs) , Internal Revenue Code (IRC) , Investment Portfolios , IRS , Private Foundations , Required Minimum Distributions , S-Corporation , Tax Deductions , Tax Liability

Business Expenses Paid by Shareholder, But Whose Deduction Is It?

Constructive Transfers- It is axiomatic that the tax treatment of interactions between a closely held business and its owners will generally be subject to heightened scrutiny by the IRS, and that the labels attached to such...more

9/27/2022 / Business Expenses , Business Taxes , C-Corporation , Closely Held Businesses , Deductions , Investment , IRS , Parent Corporation , Personal Exemptions , S-Corporation , Shareholders , Tax Court , Tax Deductions

Planning for the Interest Charge on Installment Sales: Decanting a Grantor Trust?

I recently encountered an interesting situation in which someone suggested that a grantor trust be decanted into a non-grantor trust before the end of the taxable year. The reason? To avoid the special interest charge that...more

8/17/2022 / C-Corporation , Capital Gains , Decanting , Grantor Trusts , Installment Agreements , IRS , Limited Liability Company (LLC) , Partnerships , Pass-Through Entities , Spouses , Tax Liability , Tax-Deferred Exchanges , Trusts

Unreasonable Compensation As Constructive Dividend, Redux

An often-explored theme of this blog is the frequency with which similarly situated owners of similarly situated closely held business, facing a similar set of economic circumstances, and presented with a similar set of...more

5/3/2022 / Appellate Courts , B Corporation , C-Corporation , Closely Held Businesses , Compensation , Dividends , Entrepreneurs , Management Fees , Reasonable Compensation , Shareholders , Stocks , Tax Court , Tax Deductions , Written Agreements

Constructive Dividends and The Closely Held C Corporation

Withdrawing Value- Any tax adviser who has represented closely held businesses and their owners long enough realizes there are certain recurring themes that transcend the otherwise unique characteristics of the industry of...more

3/21/2022 / C-Corporation , Closely Held Businesses , Compensation , Corporate Taxes , Credit Cards , Dividends , IRS , Management Fees , Meal and Entertainment Expenditures , Personal Use , Shareholder Distributions , Shareholders , Tax Court , Tax Planning

Reasonable Compensation Meets The Principal Shareholder of a C Corp

Double Tax- The shareholders of C corporations have long sought legitimate operational and transactional structures by which they may reduce the double tax hit that is realized when such a corporation distributes its...more

The Liquidation of a Partner’s Interest Under NYC’s Unincorporated Business Tax

Taxes and Snowy Weather? How many of you awoke Saturday to find that the winter storm about which we had heard so much during the preceding days had lived up to its hype? What was your first thought? “Fudge,” right?...more

2/4/2022 / C-Corporation , Income Taxes , IRS , Liquidation , New York , Partnerships , Pass-Through Entities , S-Corporation , State Taxes , Tax Authority , Tax Deductions , Taxable Income , Unincorporated Business Tax (UBT)

Leaving New York – But What About One’s New York Business?

Goodbye New York- Late last year, the U.S. Census Bureau released data showing population shifts across the country during 2021. According to this information, New York lost 1.8 percent of its population... ...more

1/18/2022 / Apportionment , C-Corporation , Census Bureau , Closely Held Businesses , Corporate Taxes , Domicile , Exit Tax , Income Taxes , Middle Market , New York , Pass-Through Entities , Residence Status , Small Business , State of the State , Tax Advice , Tax Increases , Tax Relief , Taxable Income

Selling Your S Corporation’s Business? What If It’s Not an S Corporation?

Haste Makes Waste? How many of you are suffering from Build Back Better Fatigue? Seriously, it’s a thing. Sure, the House passed its version of the President’s tax and spending bill on November 19, and the Senate...more

12/9/2021 / Beneficiaries , Business Ownership , C-Corporation , Capital Gains Tax , Closely Held Businesses , Good Faith , IRS , Reorganizations , Restructuring , S-Corporation , Sale of Assets , Shareholders , Target Company , Tax Increases , Trustees , Trusts , Ways and Means Committee

One Step Closer to “Building Back” – Where Do Federal Transfer Taxes Stand?

Tax the Rich? The President’s plan for a tax regime that would ensure the rich pay their “fair share” of the cost of implementing his programs has come one step closer to being realized . . . maybe . . . well, sort of ....more

Maybe Tax the Rich, but Not The Conversion of S corps into Partnerships – What Gives?

Tax the Rich? A few days ago, an opinion piece that appeared in the Wall Street Journal began as follows: “President Biden’s effort to pass the largest tax increase in U.S. history is based on the verifiably false...more

10/18/2021 / Built-In Gains , C-Corporation , Congressional Budget Office , Corporate Taxes , Fair Market Value , Joe Biden , Limited Liability Company (LLC) , Liquidation , OECD , S-Corporation , Sale of Assets , Shareholders , Tax Increases , Taxable Income , Ways and Means Committee , Wealth Tax

Disposing Of Assets Under The Ways and Means Committee’s Proposals

First Step- Last Wednesday, the House Ways and Means Committee approved that portion of the 2022 budget legislation with which it was tasked by the Congressional Budget resolution of August 24. The text of the bill...more

Tax Distributions As Fraudulent Conveyances?

The Calm Before? I’m confused. For better or worse, I’m pretty sure that I am not alone. Last week, in a letter addressed to the American people, forty-six of the fifty Republicans in the U.S. Senate indicated they...more

8/16/2021 / Bankruptcy Code , Biden Administration , Budget Reconciliation , C-Corporation , Chapter 11 , Commercial Bankruptcy , Debtors , Infrastructure , Limited Liability Company (LLC) , Liquidation , Pass-Through Entities , Private Equity Funds , Tax Increases , Taxable Distributions , Trustees

Louis Vlahos

Rivkin Radler LLP

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