Legal Updates & Commentary for Tax & Estate Planning
In the last two posts, we saw how a Taxpayer who transfers Property A to a partnership (“Partnership”) in exchange for an equity interest therein will not be required to recognize the gain realized on the transfer. This gain will not be included in Taxpayer’s gross income because Taxpayer is viewed under…
A closely-held business will often use deferred compensation arrangements to induce or reward certain behavior by its key non-shareholder executives; for example, to incentivize the executive to attain certain business performance goals or operational benchmarks.
Such an incentive arrangement will defer the payment of compensation such as a bonus until the compensation is earned, usually…
Deferred Payments
It goes without saying that when a taxpayer disposes of property in a taxable sale or exchange, the gain realized on the sale will be subject to tax. Depending upon the nature of the asset disposed of, the gain may be taxable at ordinary or at capital gain rates.
It is also generally…
