I’ve read a number of articles over the last few weeks in which marriage counselors have been predicting a wave of divorce filings once the COVID-19 quarantine has been lifted.[i]
That may be – we’ll just have to wait and see.[ii] Query, however, whether “business divorces” will follow suit?
A couple of years ago, this blog carried an article that briefly considered whether the gain realized by a taxpayer on the sale of a contract should be treated as ordinary income or capital gain for tax purposes.[i]
As it turned out, that piece has been one of the most popular articles that we
Last week’s post considered the risk assumed by a taxpayer that ignores the plain meaning of a Code provision (the definition of “capital asset”) in favor of a more “rational” – favorable? – interpretation of that provision.
This week’s post considers the “plain meaning” of the same section of the Code: the definition of the
In the sale of a business, it is the goal of every business owner and his tax adviser to minimize the amount of gain recognized and, to the extent gain is recognized, to maximize the amount that is treated as capital gain.
The gain realized on
Once Upon A Time . . .
a corporation, Corp, was founded. The year was 2006, and Employee immediately was hired as Corp’s chief technology officer and received restricted stock grants from Corp. As a “founder” of Corp, Employee initially owned 9.8% of Corp’s stock. However, each time investors infused capital into Corp, Employee’s interest