IRS Delays Basis Consistency Reporting Due Date (again)... [ read ]
The IRS issued Notice 2016-17 (a link to the Notice will be provided when available), effective March 23, 2016. The notice extends the initial filing deadline for the new Form 8971 to June 30, 2016.
IRS Report Shows Increase in Partnership and S Corporation Examinations... [ read ]
The Internal Revenue Service ("IRS") recently issued its Fiscal Year 2015 Enforcement and Service Results report (the "Report"), which contains interesting information, particularly for owners of Subchapter K partnerships and Subchapter S corporations.
Time to Celebrate -- The IRS Issued Temporary & Proposed Regs Detailing Consistency Basis Reporting Requirements!... [ read ]
On 3/2/14, the IRS issued proposed and temporary regulations addressing the basis consistency requirements under §§ 1014 and 6035 of the Code. As discussed in my prior post on the subject, regulation § 1.6035-2T(b) reiterates the March 31, 2016 due date for filing Form 8971 that would otherwise have been due prior to then.
Wealth Transfer Planning: What Your Investment Banker Didn't Tell You... [ read ]
Just like real estate brokers will help you stage your home before they list it, investment banks and commercial banks will advise you to perform a corporate house cleaning before you begin to market your company. A few common "due diligence" questions you may want to ask yourself include:
Rights of a Texas Corporation's Minority Shareholder: More Limited Still... [ read ]
A minority shareholder of a closely held Texas corporation wanted out. She asked the corporation to buy her shares. In response, the corporation offered her a price that she believed inadequate. She asked the corporation to cooperate with her in selling her shares. In particular, she asked the corporation's president to meet with a prospective buyer. The president declined to meet, citing advice of counsel. (Although the facts are more complicated this is the boiled-down essence.)
Perseverance Pays Off: IRS Returns Seized Cash to Store Owner... [ read ]
Nearly two years ago, Khalid Quran, a convenience store owner in North Carolina, obtained an unwanted firsthand account of the power that the IRS has when seizing funds that it suspects were deposited and/or withdrawn in violation of federal currency reporting requirements. In June 2014, the IRS seized $153,907 from Mr. Quran's business account because he allegedly made several withdrawals of cash under $10,000.
The Latest IRS Scam--The Scammers are Getting a Little Smarter... [ read ]
I had a good friend send me a letter that one of his clients received from the "IRS". The letter is a hoax and another attempt by scammers to take money from people.
Taxpayers Beware! Fifth Circuit Appellate Court Applies the "Self-Rental Rule" to Preclude Taxpayers from Applying Passive Loss Against Rental Income... [ read ]
Earlier this month, the Fifth Circuit Court of Appeals had occasion to decide the applicability of the "self-rental rule" in Treas. Reg. § 1.469-2(f)(6) in the context of a Subchapter S corporation renting commercial real estate to its affiliated Subchapter C corporation. See Williams v. Comm'r, 2016 BL 28240, 117 AFTR 2d ¶ 2016-393 (5th Cir. 2016). The court's decision is notable because the Fifth Circuit essentially ignored the S corporation's involvement in the transaction in applying the "self-rental rule."
Golden Opportunities – Personal Goodwill Can Reduce Federal Income Tax Liability from Sales of Businesses... [ read ]
In the right circumstances, a taxpayer may be able to significantly reduce his/her federal income tax liability from the sale of his/her business by establishing that the buyer separately bargained for the purchase of that taxpayer's personally-owned property (referred to herein as "personal goodwill"). This is because a sale of personal goodwill, if respected, would result in only a single taxable event, with the taxable gain potentially subject to the beneficial long-term capital gain tax rate (with a current maximum marginal tax rate of 20%).
IRS Delays Basis Consistency Reporting Due Date... [ read ]
IRS extends the filing deadline for the new Form 8971 to March 31, 2016.
