planning ahead

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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…

What’s the first thing that comes to mind when you hear that someone has engaged in a like-kind exchange? Real property, right? A taxpayer who owns a rental building with commercial and/or residential tenants exchanges the building for another rental property, usually as part of a deferred exchange. Or, a taxpayer that owns a building…

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…

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?

Silly Question?

“Which do you prefer: a taxable or a non-taxable transaction?”

Most taxpayers would probably respond that they prefer a non-taxable transaction. After all, who wants to pay tax if they don’t have to?

Closer analysis, however, may reveal that given a particular taxpayer’s situation, a taxable transaction may yield a better result.…

Incentive Compensation

It is not uncommon for a closely-held business to provide an economic incentive to its key employee. Often, the incentive takes the form of an annual cash bonus. Alternatively, the business may provide the key employee with a longer-term incentive, in the form of a deferred compensation arrangement that may be payable on…

For most closely-held businesses, and especially for those that are newly-formed, the infusion of capital is of paramount concern because it may be needed to fund start-up costs, operations and, eventually, expansion. In some cases, the capital may be obtained from investors in exchange for an equity interest in the business; in others, the capital…