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Foster Garvey PC

A Journey Through Subchapter S / A Review of The Not So Obvious & The Many Traps That Exist For The Unwary: Part XIV – An S...

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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

Rivkin Radler LLP

Shareholder-Transferee Liability for a Corporation’s Income Tax

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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

Rivkin Radler LLP

The Family-Owned Business, Stock Options, And Personal Goodwill – a Smorgasbord of Tax Issues

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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

Rivkin Radler LLP

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

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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

Rivkin Radler LLP

Constructive Dividends and The Closely Held C Corporation

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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

Rivkin Radler LLP

Employee-Shareholders, Reasonable Compensation And Employment Taxes

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Movement Toward Tax Increases- You may have read last week that Democrats on the Senate Budget Committee announced they had reached a deal on a budget resolution that will enable them to bypass Senate Republicans on the...more

Rivkin Radler LLP

Tax Changes In The Offing? “Close Scrutiny” Of Business Owners’ Economic Benefits Remains A Constant

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I Read the News Today- Much of today’s news is dominated by the future of the Administration’s broadly defined infrastructure plan. Discussions among “those in the know” inevitably turn into debates over the wisdom of...more

Farrell Fritz, P.C.

How Dealings Between Related Parties Doomed A Captive Insurer

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Insurance: What is it? How does it work? Assume that Acme Co is paying premiums for commercial insurance coverage to protect itself from economic losses that may arise out of various events. These premiums are deductible...more

Farrell Fritz, P.C.

Corporate Tax Hike On The Horizon: Using Reasonable Compensation To Withdraw Value

Farrell Fritz, P.C. on

Corporate Rate Increase? We begin this week with the Senate having passed the President’s $1.9 trillion coronavirus relief and economic stimulus plan (the “American Rescue Plan” following a marathon session during which...more

Farrell Fritz, P.C.

Transfer Of Funds between Related Entities – Indebtedness Or Something Else?

Farrell Fritz, P.C. on

A closely held business may come to our firm for any number of reasons. The owners may be selling the business, for example, or they may be thinking about spinning off a division. In some cases, the owners are considering the...more

Eversheds Sutherland (US) LLP

Grecian Magnesite: Tax Court Finds Reliance on a US Tax Advisor Establishes Reasonable Cause

On July 13, 2017, the Tax Court, in Grecian Magnesite, Industrial & Shipping Co., SA v. Commissioner, 149 T.C. 3 (2017), rejected Internal Revenue Service (IRS) arguments that, in order to establish good faith reliance, the...more

Dickinson Wright

Recent Tax Court Cases Serve As Reminder Of Tax Risks Of Shareholder Guarantees Of Loans To S Corporations

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Two recent Tax Court cases are reminders that shareholder guarantees of loans to an S corporation do not generally create basis that can be used by the shareholder to deduct losses. Under Internal Revenue Code...more

Coblentz Patch Duffy & Bass

Transferee Liability: The [Unlikely] Situation that your Nonprofit Receives a Charitable Gift with Expensive Tax Strings Attached

The case of Salus Mundi Foundation et al v. Commissioner - On August 15, 2016, the Tax Court decided in Salus Mundi Foundation et al v. Commissioner, T.C. Memo. 2016-154, that two foundations were liable as transferees...more

Bilzin Sumberg

Commission Payments to IC-DISC Recharacterized as Non-Deductible Dividends

Bilzin Sumberg on

In Summa Holdings, Inc. v. Commissioner, T.C. Memo 2015-119, the Tax Court recharacterized an exporter’s deductible commission payments made to an IC-DISC as non-deductible dividend payments to the exporter’s shareholders...more

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