Legal Updates & Commentary for Tax & Estate Planning
When A Business Fails
It goes without saying that no one goes into business in order to realize a loss. Unfortunately, not all businesses succeed, and many owners suffer significant losses. The challenge presented for the tax adviser to the business is how to best utilize those losses for income tax purposes and, thereby, to…
No, I don’t mean the yellow-brick road, or any train, or anything like that. I am referring, of course, to the Protecting Americans from Tax Hikes Act of 2015 (the “PATH” or the “Act”). The recently enacted legislation provides a number of tax benefits, a few of which will be of particular interest to…
It Was the Worst of Times, Except . . .
It happens in most closely-held businesses: so long as the business is profitable and cash keeps flowing into the hands of the owners, everyone is happy. When the spigot slows, or is just plain turned off, however, the investor-owners (as distinguished from the management-owners) will…
It sounds pretty impressive, doesn’t it? What’s more impressive is that, this time, Congress did not wait until the very end of the year – or the beginning of the next year for that matter – to pass some important and long-awaited legislation. (the “Act”).
Most businesses and their advisers would have preferred to…
There is nothing like an old proverb to remind you of the obvious. Unfortunately, too many taxpayers need to be reminded all too often. It’s one thing when the reminder comes from the taxpayer’s own advisers – at that point, the taxpayer may still have an opportunity to “correct” his or her actions. It is…
A Plethora of Partnerships
According to a recently released IRS analysis of tax return data, the number of partnerships and partners in the U.S. continues to increase, as do the total receipts and the value of total assets for all partnerships. LLCs classified as partnerships account for the majority of this growth.
These figures…
In General
In earlier posts, we described how a closely-held business may use a nonqualified deferred compensation (“NQDC”) plan to retain the services of, and to incentivize, a key executive employee. We also discussed the various requirements that such a plan must satisfy in order to successfully defer the inclusion in the employee’s income…
Oops
During the course of my career, I have sometimes gone months, if not years, without encountering a particular tax issue. I am aware of the issue and I am familiar with the relevant authorities, but it was not a concern for the clients whom I was then representing. Then, all of a sudden, the…
It is not unusual for a closely-held business or for its owners to issue or transfer equity in the business to a third party in order to raise necessary funding for the business or to secure the services of someone with a certain expertise. In most cases, where the equity transfer is made by the…
Why, Oh Why?
We’ve heard it before: “Why would you choose to operate as an S corporation?”
Underlying this question are a number of other business-related questions, among which are the following:
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