Legal Updates & Commentary for Tax & Estate Planning
The reduction in the Federal income tax rate for C corporations, from a maximum of 35-percent to a flat 21-percent, along with several other changes made by the Tax Cuts and Jobs Act (the “Act”) that generally reflect a pro-C corporation bias, have caused the owners of many pass-through entities (“PTEs”) to…
Last week’s post may have left some readers feeling lightheaded or anxious. [1] It is highly unlikely that this week’s post will leave these individuals in a greatly altered state, though it may alleviate their condition to some extent, at least momentarily.
That is not to say that the issue at the root of today’s…
Although closely-held businesses have generally welcomed the TCJA’s[i] amendments to the Code relating to the taxation of business income, many are also frustrated by the complexity of some of these changes. Among the provisions that have drawn the most criticism on this count are the changes to the taxation of…
An often-explored theme of this blog is the frequency with which similarly situated business taxpayers, facing the same set of economic circumstances, and presented with the same set of choices, will knowingly repeat the “mistakes” made by countless taxpayers before them.[i] They will choose a course…
It is said that repetition is the mother of all learning. It is also said that insanity is repeating the same mistake and expecting a different result. It is my hope that the result of the former will overwhelm the source of the latter before it is too late.
However, based upon the seemingly continuous…
By now, most readers have heard about the benefits and pitfalls of “checking the box” or of failing to do so. Of course, I am referring to the election afforded certain unincorporated business entities to change their status for tax purposes. Thus, for example, an LLC with one or more members – which…
The following probably sounds familiar. You’re meeting with a new client who is being audited by the IRS. The client brings you their federal and state individual income tax returns and the income tax returns for their business entity.
You look at the client’s reported wages and dividends; you look at…
I recently encountered a situation in which the so-called “basis consistency” rule was implicated. This rule requires consistency between the estate tax value of a decedent’s property – its fair market value (“FMV”) as reported on the decedent’s estate tax return – that passes to a beneficiary, and the basis claimed by…
I had a call a couple of weeks ago from the owner of a business. His brother, who owned half of the business, owed some money to someone in connection with a venture that was unrelated to the business. The brother didn’t have the wherewithal to satisfy the debt and, to make matters worse, the…
How many times have you said to a client, “Please don’t agree to any deal terms until we’ve had a chance to discuss your goals and plans, consider your options, and analyze the consequences.”
How many times has a client presented you with a fully executed “letter of intent” – one that you’ve never seen…
