It is a basic principle of the income tax that the gain or loss realized by a taxpayer from the conversion of property into cash, or from the exchange of property for other property that differs materially in kind from the...more
6/11/2024
/ Beneficiaries ,
Capital Gains ,
Corporate Restructuring ,
Equity Investors ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Like Kind Exchanges ,
Limited Liability Company (LLC) ,
Liquidation ,
Partnerships ,
Property ,
Reorganizations ,
Shareholders ,
Tenancy-in-Common ,
Transfer of Assets ,
Trustees ,
Trusts ,
Wills
An anonymous thinker, lost to history, is credited with having said that the unofficial motto of the IRS is, “We have what it takes to take what you have.” In some instances, the truth of the above statement is manifested in...more
5/30/2024
/ Alter Ego ,
Appeals ,
Audits ,
Bad Actors ,
Bank Accounts ,
Capital Gains ,
Deficiency Notices ,
Income Taxes ,
IRS ,
S-Corporation ,
Sole Proprietorship ,
Summary Judgment ,
Tax Avoidance ,
Tax Court ,
Tax Liability ,
Tax Liens
Earlier this year, the OECD observed there has been a significant increase in global wealth inequality over the last two decades. It also acknowledged that “taxation is a key instrument . . . that governments have at their...more
5/16/2024
/ Audits ,
Capital Gains ,
Federal Budget ,
Foreign Governments ,
Inflation Reduction Act (IRA) ,
IRS ,
Net Investment Income ,
OECD ,
Presidential Elections ,
Surtax ,
Tax Authority ,
Tax Avoidance ,
Tax Increases ,
Tax Liability ,
United Nations ,
Wealth Tax ,
Whistleblowers
Assume that X and Y agree to the following: X will transfer ownership of Prop to Y, and Y will transfer cash to X.
What just happened? Obviously, X has sold Prop to Y. If the amount of cash that X receives is greater than...more
5/6/2024
/ Anti-Abuse Rule ,
Disguised Sales ,
Equity Partners ,
Financial Transactions ,
Income Taxes ,
Internal Revenue Code (IRC) ,
Investment ,
Investment Adviser ,
IRS ,
Limited Liability Company (LLC) ,
Membership Interest ,
Partnership Distributions ,
Partnership Interests ,
Partnerships ,
Promissory Notes ,
Suppliers ,
Tax Avoidance ,
Tax Court
Over the years, I have observed there is only one thing that a taxpayer fears more than being notified by the IRS that their income tax return for a particular taxable year has been selected for audit, and that is being...more
4/24/2024
/ Audits ,
Court of Federal Claims ,
Debt Collection ,
Deficiency Notices ,
Filing Deadlines ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Lack of Jurisdiction ,
Petition for Writ of Certiorari ,
Redeterminations ,
SCOTUS ,
Tax Court ,
Tax Penalties ,
Tax Returns
Imagine the IRS notifies Taxpayer that they have an outstanding tax liability with respect to Tax Year, and that the agency intends to levy on Taxpayer’s property to collect the allegedly unpaid tax. Taxpayer challenges the...more
4/19/2024
/ Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Overpayment ,
Popular ,
Spouses ,
Tax Appeals ,
Tax Court ,
Tax Debt ,
Tax Levy ,
Tax Liability ,
Tax Refunds ,
Tax Returns
As we approach the deadline for paying federal individual income taxes and, generally, for filing the returns on which such taxes are determined, some of you may be recalling how the Inflation Reduction Act of 2022...more
4/11/2024
/ Administrative Law Judge (ALJ) ,
Attendance ,
Compensation & Benefits ,
Federal Employees ,
Income Taxes ,
Inflation Reduction Act (IRA) ,
Internal Revenue Code (IRC) ,
IRS ,
Misleading Statements ,
Paid Time Off (PTO) ,
Performance Reviews ,
Privately Held Corporations ,
Sick Leave ,
Surveillance ,
Tax Returns ,
Termination ,
Treasury Inspector General for Tax Administration (TIGTA) ,
U.S. Treasury
Depending upon what you read or, perhaps more accurately, depending upon how much you believe of what you read, you may be aware that many closely held businesses are concerned about their future.
Most of these survived...more
4/4/2024
/ Bad Actors ,
Business Closures ,
Business Ownership ,
Closely Held Businesses ,
CPAs ,
Duty to Act ,
Embezzlement ,
Employment Tax ,
Financial Distress ,
IRS ,
Responsible Party ,
Tax Court ,
Trust Fund Recovery Penalty (TFRP) ,
Trust Funds ,
Withholding Tax
Last week, Sen. Warren reintroduced her “Ultra-Millionaires” wealth tax proposal to the Senate. Query her timing. The measure has the proverbial snowball’s chance in Hell of being enacted by this Congress.Perhaps the Senator...more
3/26/2024
/ Biden Administration ,
Business Entities ,
Business Income ,
Business Losses ,
Capital Gains ,
Closely Held Businesses ,
Corporate Taxes ,
Federal Budget ,
Federal Taxes ,
Income Taxes ,
Investment ,
Limited Liability Company (LLC) ,
Medicare Taxes ,
NIIT ,
Partnerships ,
S-Corporation ,
Self-Employment Tax ,
Shareholders ,
Tax Deductions ,
Tax Rates ,
Taxable Income ,
U.S. Treasury ,
Wealth Tax
Earlier this week the White House released its Fiscal Year 2025 Budget. Of course, the federal government has not yet adopted a budget for the Fiscal Year 2024 even as we approach that year’s halfway mark. But I digress. The...more
3/18/2024
/ Capital Gains ,
Estate Tax ,
Exclusions ,
Fair Market Value ,
Federal Budget ,
Fiscal Year ,
Gift Tax ,
Grantor Retained Annuity Trusts (GRATs) ,
Grantor Trusts ,
Grantors ,
GST ,
IRS ,
Reporting Requirements ,
Revocable Trusts ,
Tax Credits ,
Tax Deferral ,
Tax Increases ,
Tax Revenues ,
Transfer Taxes ,
Trusts ,
U.S. Treasury ,
Valuation
How many times have you wished that you could undo something from your past, perhaps a string of incoherent statements made at a client dinner while slightly under the influence, or an expletive-filled email composed and sent...more
3/7/2024
/ Abrogation ,
Capital Gains ,
Cash Transactions ,
Fair Market Value ,
IRS ,
Property Transaction Taxes ,
Property Valuation ,
Reacquisitions ,
Real Estate Transactions ,
Related Parties ,
Repossess ,
Rescission ,
Selling a Business ,
Tax Liability
It is not uncommon, in the context of a business entity in which a family owns a controlling or substantial interest, for an adviser to encounter intersecting gift and income tax issues.
This week’s post will consider one...more
Would you be surprised to learn that most shareholders of closely held corporations, and especially those with minority or merely passive interests, believe they cannot be held responsible for the tax obligations of their...more
2/15/2024
/ Closely Held Businesses ,
Corporate Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Limited Liability ,
Liquidation ,
Securities ,
Shareholders ,
Stock Purchase Agreement ,
Stock Sale Agreements ,
Stock Transfer ,
Tax Court ,
Tax Liability ,
Tax Shelters ,
Transferees
Many of us have encountered variations of the following scenario: a parent owns and operates a business; one or more of their children are employed in the business; as the children mature and become more experienced and...more
2/9/2024
/ Asset Purchase Agreements ,
Business Assets ,
Business Succession ,
Closely Held Businesses ,
Family Businesses ,
Gift Tax ,
Grantors ,
IRS ,
Limited Liability Company (LLC) ,
Non-Compete Agreements ,
S-Corporation ,
Shareholders ,
Stocks ,
Succession Planning ,
Tax Court
Heads I Win, . . . -
When closely held corporations that are under common control engage in any intercompany transaction, it is prudent for the corporations and their shareholders to ensure that the transaction is being...more
2/2/2024
/ Business Losses ,
Business Taxes ,
Capital Contributions ,
CFOs ,
Closely Held Businesses ,
Creditors ,
Debt ,
Earnings Reports ,
Fund Distribution ,
Intent ,
Intercompany Transactions ,
Investment ,
IRS ,
Loan Repayment Issues ,
Loans ,
Tax Court ,
Tax Returns ,
Taxable Distributions
The Long-Term View-
Among its core functions, federal tax policy seeks to encourage those behaviors among businesses that, in the long run, will have a lasting positive effect upon the nation’s economy as a whole. ...more
1/26/2024
/ Federal Taxes ,
Gift Tax ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Itemized Deductions ,
MACRS ,
Modification ,
Sunset Provisions ,
Tax Cuts and Jobs Act ,
Tax Deductions ,
Tax Exemptions ,
Tax Legislation ,
Tax Rates
Few individual owners of a closely held business would be surprised if you explained to them that the IRS and the Federal courts generally will subject many transactions between certain “related” persons to heightened...more
1/17/2024
/ Aggregate Damages ,
Audits ,
Business Losses ,
Capital Gains ,
Closely Held Businesses ,
Family Businesses ,
Family Members ,
IRS ,
Partnerships ,
Proposed Regulation ,
Related Parties ,
Tax Deductions
A national study released in 2015 reported that “nearly half the residential purchases of over $5 million were made by shell companies rather than named people.”[ii] Because shell companies could often be formed without...more
1/5/2024
/ Beneficial Owner ,
Business Ownership ,
Corporate Transparency Act ,
Department of Finance ,
Disclosure Requirements ,
FinCEN ,
Limited Liability Company (LLC) ,
New York ,
Popular ,
Real Estate Investments ,
Shell Corporations ,
U.S. Treasury ,
US State Departments
This is The End-
I have dreaded the year end for as long as I can remember. As a teenager and then as a young adult I associated the final quarter of the year, and especially the period beginning on Thanksgiving and...more
12/20/2023
/ Business Ownership ,
Capital Gains ,
Carried Interest ,
Closely Held Businesses ,
Estate Tax ,
Federal Taxes ,
Gift Tax ,
Grantor Retained Annuity Trusts (GRATs) ,
Income Taxes ,
Investors ,
IRS ,
Tax Cuts and Jobs Act ,
Tax Planning ,
Transfer Taxes ,
Trusts ,
U.S. House
The Office of the New York State Comptroller just released a new report that examines taxpayer migration trends during the pandemic. The report, which builds on an earlier analysis of pre-pandemic taxpayer migration trends,...more
12/8/2023
/ Administrative Law Judge (ALJ) ,
Capital Gains ,
Carried Interest ,
Compensation ,
Conciliation ,
Dividends ,
Double Taxation ,
Investment Management ,
K-1 ,
Limited Liability Company (LLC) ,
New York ,
Non-Residents ,
Partnerships ,
Relocation ,
Resident Status ,
State Taxes ,
Tax Appeals ,
Tax Credits ,
Tax Rates ,
Tax Returns ,
Taxable Income ,
Tribunals
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
11/29/2023
/ Business Income ,
C-Corporation ,
Consultants ,
Deferred Compensation ,
Directors ,
Employee Benefits ,
Family Businesses ,
Family Members ,
IRS ,
Marketing ,
Personal Liability ,
Rental Property ,
Residential Property Owners ,
Restructuring ,
Retirement Plan ,
S-Corporation ,
Sole Proprietorship ,
Tax Court ,
Tax Deductions ,
Tax Rates
Thanksgiving has been a national holiday in the U.S. since 1870. During most of that period, at least until recently, it has also been a unifying force as immigrants to this country, eager to be assimilated to American...more
11/22/2023
/ Black Friday ,
Debt ,
Federal Taxes ,
Holidays ,
Immigrants ,
Income Taxes ,
Redistribution ,
State of the Union ,
Stock Markets ,
Tax Revenues ,
Thanksgiving
New York Governor Kathy Hochul signed a bill on Friday, November 20, 2023, that allows New York City cannabis businesses to deduct business expenses paid or incurred in carrying on such business for purposes of determining...more
11/21/2023
/ Business Expenses ,
Business Taxes ,
Cannabis-Related Businesses (CRBs) ,
Controlled Substances Act ,
Internal Revenue Code (IRC) ,
Marijuana Related Businesses ,
New Legislation ,
New York ,
Schedule I Drugs ,
Tax Deductions ,
Tax Liability
NY Needs the Revenue-
A couple of weeks ago, the Tax Foundation released its latest “State Business Tax Climate Index,” which assesses a state’s tax system and compares it to that of other states. New York seems to be a...more
11/15/2023
/ Audits ,
Conciliation ,
Investors ,
Limited Liability Company (LLC) ,
Managing Members ,
New York ,
OCC ,
Penalties ,
Personal Liability ,
Responsible Person Liability ,
Sales Tax ,
State Taxes ,
Tax Liability ,
Tax Revenues
It appears that many of the country’s colleges and universities believe they have not already contributed enough to the decline of American education and to the erosion of our society, generally.
These institutions of...more
11/9/2023
/ Activist ,
Annuities ,
Bad Actors ,
Business Income ,
Colleges ,
Dividends ,
Donors ,
Endowment Funds ,
Executive Compensation ,
Exempt Organizations ,
Federal Funding ,
Hate Speech ,
Income Taxes ,
Internal Revenue Code (IRC) ,
IRS ,
Non-Taxable Income ,
Operational Requirements ,
Public Charities ,
Public Policy ,
Rent ,
Royalties ,
Student Loans ,
Students ,
Tax Benefits ,
Tax Deductions ,
Tax Exemptions ,
Tuition ,
Universities