We frequently hear about the many wealthy foreigners who acquire investment interests in New York real property, and the complex tax considerations relating to such investments. Yet, we sometimes forget that there are many US persons outside of NY (New Jersey is still part of the US, right? Oh well) who are drawn to an
Dissolved? According to Whom?
In most cases, a financially troubled business will face some difficult choices, including which creditors to pay and which to defer. The Federal and State taxing authorities are often among these creditors. As we have seen on other occasions, a business’s decision to defer the payment of State taxes may have significant legal and, ultimately
Taxable? How Will They Know?
I’ll take My Chances If I had a dollar for every time a client said to me “but they never audit real property transfer tax returns,” I’d be a client myself. I often hear this statement in the context of a transaction that a client insists should not be subject to the transfer tax, and it is often made in response to my analysis that the hoped-for result would not stand up to scrutiny.
Continue Reading Taxable? How Will They Know?
Dissolved By The State; Rejected By The Tax Court.
It’s great to be in business when things are going well. When things start to go badly, however, they can quickly cascade out of control, with reduced cash flow leading to the diversion of trust fund taxes, like sales and employment taxes, toward the payment of business expenses. Additionally, a struggling business owner in need
But I Don’t Want to Pay Taxes!
Last week’s posts described a situation in which the IRS was able to collect a deficiency in corporate income tax from a minority shareholder of the taxpayer-corporation on the basis of transferee liability under state law. Recently, another decision addressed the question of transferee liability, this time in the instance of a dissolved corporation’s unpaid
Responsible Persons & Sales Tax Issues: Part III
In our last two posts, we described the concept of the “responsible person” under NY’s sales tax law, and how such an individual may become personally liable for the unpaid sales tax of a business. We also explored the factors that are considered in determining one’s status as a responsible person, as well as some
Responsible Persons & Sales Tax Issues: Part II
In our last post, we described the concept of the “responsible person” under NY’s sales tax law, and how such an individual may become personally liable for the unpaid sales tax of a business. Today we will explore the factors that are considered in determining one’s status as a responsible person, as well as
Responsible Persons & Sales Tax Issues: Part I
Introduction
Many taxpayers fail to appreciate that any officer, director or employee of a corporation, and any employee or manager of a partnership or LLC, who has a duty to act for such entity in complying with any requirements of the sales tax law, may be held personally liable for the sales tax collected or
Deal Economics: The NY Real Estate Transfer Tax, Part III
Income Tax Impact of Transfer Taxes
We noted earlier that state transfer taxes are often viewed as a “sideshow” to federal income tax considerations in structuring a deal. Despite this perception, state transfer taxes represent real economic cost to the payor. To appreciate their “true” cost, however, one must also consider their income tax consequences.
Deal Economics: The NY Real Estate Transfer Tax, Part II
In contrast to the sales tax, which does not apply to a sale of real property or to a sale of equity in a company, the real estate transfer tax does apply to the former and may apply to the latter. In the context of a deal, there may also be other situations in which