This discussion explores the allocation of E&P in a distribution to which Sec. 355 applies.
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TOPICS
C Corporation Income Taxation
CFC worthless stock deductions after tax reform
This discussion focuses on the GILTI and BEAT implications for the benefit received by a U.S. corporation reporting a worthless stock deduction
under Sec. 165(g) for a CFC’s stock.
IRS issues more proposed regs. on qualified opportunity funds
The regulations define the term “substantially all,” the definition of which was reserved in the earlier proposed regulations issued in October 2018.
Consolidated return regs. provide special return due-date rules for short tax years
This item discusses special return due-date rules for a target corporation’s short tax year when it joins a consolidated group.
Traded player contracts and draft picks have zero value under safe harbor
The IRS will permit professional sports teams that trade player contracts to recognize zero gain if both parties to the exchange adopt the safe harbor and do not exchange cash.
W-2 methods proposed for Sec. 199A(g) deduction by agricultural co-ops
The IRS issued methods for calculating W-2 wages for the Sec. 199A(g) deduction for agricultural and horticultural cooperatives, similar to the former Sec. 199 domestic production activities deduction.
Ninth Circuit upholds IRS cost-sharing regulation
The Ninth Circuit Court of Appeals reversed a Tax Court decision that had held that a cost-sharing regulation that required allocation of stock-based compensation was invalid.
IRS suspends spinoff revenue rulings
The IRS announced that it is reviewing its approach to the active trade or business requirement that must be met for a five-year period for a business to qualify for a tax-free spinoff under Sec. 355 and, as a result, is suspending two revenue rulings, Rev. Ruls. 57-464 and 57-492, in which it previously ruled on the topic.
Excise tax refunds for purchases of frequent flyer miles
Banks, hotel groups, large retailers, utilities, and car rental companies may be eligible for refunds of federal excise tax paid when purchasing frequent flyer miles from domestic airlines to use in reward and loyalty programs.
Conversion of a C corporation to an LLC
Converting a C corporation to a limited liability company can sometimes be beneficial, but the tax
consequences must be planned for.
State and local location incentives: Reminder that the rules have changed
The TCJA made a significant cange to the tax treatment of grants received from governmental entities, including location incentives for relocating or expanding existing facilities.
States’ treatment of GILTI and FDII: The good, the bad, and the ugly
Review the various approaches states use to account for the GILTI and FDII regimes introduced by the TCJA.
Rules for certified professional employer organizations finalized
Certified professional employer organizations (CPEOs) enter into contracts with employers to be treated as the employer for employment tax purposes and are subject to IRS rules in order to qualify as CPEOs and maintain that status.
Taxation of sexual harassment settlements post-TCJA
Because of the considerable tax consequences, the new law will encourage plaintiffs and defendants to refrain from including a nondisclosure agreement in their sexual harassment settlements.
Distribution by former S corporation is part dividend
The IRS ruled that a distribution to the sole shareholder of a C corporation was partly a recovery of the former S corporation’s accumulated adjustments account (AAA) and a taxable dividend for the remaining distribution.
Opportunities beckon in new qualified opportunity zones
With their prospects for deferral or even exclusion of gains from certain investments in them, the newly created qualified opportunity zones offer an intriguing tax planning option for investors and a potential boon for distressed communities.
Considering the SRLY rules and Sec. 382 in the post-TCJA world
The TCJA significantly broadened the application
of loss limitation rules.
Structuring divisive reorganizations
Tax-free corporate reorganizations, or divisions, can be achieved with split-ups, splitoffs, and spinoffs. A consideration of the reason for the corporate division should guide the determination of which technique would be most beneficial.
New Sec. 163(j): Considerations for real estate and infrastructure businesses
This discussion highlights the treatment of an “electing real property trade or business” for purposes of the interest expense deduction limitation of Sec. 163(j).
Managing excess loss accounts
This item discusses how an ELA can occur and potential methods to minimize or eliminate these balances before they are recaptured into taxable
income.
TAX PRACTICE MANAGEMENT
2025 tax software survey
AICPA members in tax practice assess how their return preparation software performed during tax season and offer insights into their procedures.
