Legal Updates & Commentary for Tax & Estate Planning
Whether they are acquiring an interest in U.S. real property or in a U.S. operating company, foreigners seek to structure their U.S. investments in a tax-efficient manner, so as to reduce their U.S. income tax liability with respect to both the current profits generated by the investment and the gain realized on…
Picking up on yesterday’s discussion, how can a PEF reconcile its preference to acquire a depreciable or amortizable basis for its target’s assets while, at the same time, affording the target’s owners the opportunity to roll-over a portion of their equity in the target into the PEF HC on a tax-favored basis? The answer is hardly simple, and it will depend upon a number factors.
Continue Reading Rolling Over Target Equity Into A PE Fund: Part II
For many business owners, the final step of a successful career may be the sale of their business. At that point, the investment into which the owners have dedicated so much time, effort and money is liquidated, leaving them with what is hopefully a significant pool of funds with which to enjoy their retirement, diversify…
According to statistical data released by the IRS earlier this year, the examination rate for partnership tax returns has been increasing significantly over the last couple of years; of course, this includes returns filed by LLCs that are treated as partnerships for Federal income tax purposes. This should come as no surprise given the significant…
In general, self-employed individuals are subject to employment taxes on their net earnings from self-employment.
The wages paid to individuals who are non-owner-employees of a business are subject to employment taxes regardless of how the business is organized.
The shareholders of a corporation are not subject to employment taxes in…
It Happens All The Time
A business owner dedicates every waking moment to the growth and well-being of the business. Invariably, the owner is motivated, in no small part, by the desire to provide for his or her family. After years of effort, and maybe some luck, the business succeeds. The owner and his or…
WTH?
It is not unusual to come across an IRS letter ruling that elicits the following reaction from many of its readers: “why did they expend the time and money to request this ruling?”
On the face of such a ruling, the IRS’s response may seem pretty obvious; even if the readers could not cite…
Flexible Economic Arrangements
We represent a number of entrepreneurs. The form of business entity that they most often choose to operate is an LLC that is treated as a partnership for income tax purposes. They recognize that the LLC is not a taxable entity, that there are no limitations upon who may invest in an…
Part I of this post can be found here.
Potential Transferees
Now that the disgruntled shareholder has decided to transfer his or her shares to an ineligible shareholder, the transferee must be selected, as must the method of transfer.
This is a very critical point in the process because the shareholder must balance two competing…
A partnership is not subject to Federal income tax. Instead, an item of income or loss of the partnership retains its character and flows through to the partners, who must include such item on their tax returns. Generally, some partners receive partnership interests in exchange for contributions of cash and/or property, while others receive partnership…
