In Soroban Capital Partners v. Commissioner, the United States Tax Court determined that entities formed as state law limited partnerships did not necessarily mean that the limited partnerships’ limited partners were limited...more
The US Department of the Treasury has recently reinforced the progress on enforcement, specifically how the IRS is focused on tax evasion targeting and the targeting of high-income individuals and entities. The IRS has...more
In Soroban Capital Partners, LP v. Commissioner, the U.S. Tax Court determined that the exception to net earnings from self-employment in Section 1402(a)(13) of the Internal Revenue Code of 1986, as amended (the “Code”) ...more
The Tax Court, in a victory for the IRS, recently issued an opinion holding the limited partner exception to the Self-Employed Contributions Act Tax must be construed narrowly. The court held a limited partner under state law...more
The U.S. Tax Court recently issued a precedential opinion in Soroban Capital v. Commissioner, holding that the limited partner exception to the Self-Employed Contributions Act (SECA) in Section 1402(a)(13) of the Internal...more
On November 28, 2023, in Soroban Capital Partners LP v. Commissioner, the US Tax Court denied the taxpayer’s motion for summary judgment, holding that whether a limited partner in a state law limited partnership qualifies for...more
Section 1402(a)(13) of the Internal Revenue Code provides that the distributive share of “limited partners, as such” from a partnership is not subject to self-employment tax.[1] Managers of private equity and hedge funds are...more
Certain limited partners in venture capital and private equity will likely see an increase in their tax liability due to a recent U.S. Tax Court decision. Generally, partners in a partnership and members in a limited...more
A U.S. Tax Court ruled on November 28, 2023, that limited partners in a partnership may be obligated to remit self-employment tax if they are not actually “limited” with respect to their involvement and relationship to a...more
Summary - On November 28, the Tax Court, granting the Internal Revenue Service (IRS) summary judgment, held in Soroban Capital Partners LP v. Commissioner that a state law limited partner who is limited in name only, is...more
Private equity, hedge fund, and other investment fund sponsors should be aware of the recent development in the Internal Revenue Service’s (IRS’s) audit campaign with respect to potential liability for Self-Employment...more
Private equity, hedge fund, and other investment fund sponsors should be aware that there continue to be significant developments in the Internal Revenue Service's (IRS’s) audit campaign with respect to the potential...more
Report Card- A couple of weeks ago, the Treasury Inspector General for Tax Administration (“TIGTA”) released a report that presented the results of its review to determine whether the IRS’s “policies, procedures and,...more
In many respects, operating a law firm is no different than any other business. Specifically, the law firm generates revenues through providing services to its clients and incurs various operating expenses throughout the...more
As discussed in previous blog entries , the IRS has been engaged in an ongoing campaign intended to address noncompliance related to the use of crypto currencies, including a virtual currency compliance campaign spearheaded...more
Seyfarth Synopsis: The tax credits afforded to certain employers and self-employed individuals by the Families First Coronavirus Response Act (FFCRA) are in effect for the period from April 1, 2020 to December 31, 2020. ...more
In guidance published March 18, 2020 (Notice 2020-17), the Internal Revenue Service (IRS) postponed the payment deadline from April 15, 2020, until July 15, 2020, for federal income tax payments (including payments of tax on...more
We all read the headlines. Virtual currencies are a hot button topic. Even Facebook is developing their own virtual currency. It is easy to understand the attraction. The use of a virtual currency is anonymous. Account...more
Within the past year, the IRS has not changed its position on the way they are treating the taxation and reporting of digital token transactions. This alert serves as an update to last year’s rundown of cryptocurrency...more
The IRS has published Final Regulations finalizing its prior guidance that partners in a partnership must pay self-employment tax on their partnership income, even if they work for an entity owned entirely by the partnership...more
On February 14, 2019, the TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION (TIGTA) released the Report “Expansion of the Gig Economy Warrants Focus on Improving Self-Employment Tax Compliance”. ...more
The IRS recently released temporary regulations clarifying that an employee of a disregarded entity is liable for self-employment tax if the employee is a partner in the partnership that owns the disregarded entity. See...more
On May 3, 2016, the U.S. Department of the Treasury issued new temporary and proposed regulations (Temp. Treas. Reg § 301.7701-2T) addressing the tax treatment of partners of a partnership that is the sole owner of an entity...more
Employees of partnerships, LLCs or their disregarded entity subsidiaries who receive equity in such entities may be treated as “self-employed” for tax purposes. On May 3, 2016, the US Treasury Department (Treasury)...more
The Treasury Department (Treasury) and the Internal Revenue Service (Service) have issued temporary regulations (Regulations) clarifying the federal employment tax treatment of the owners of partnerships and other entities...more