The 20% personal holding company tax may unexpectedly apply to an investment partnership.
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Tax Planning; Tax Minimization
Recapture considerations for Inflation Reduction Act credits
The Inflation Reduction Act not only created $663 billion in new energy-related credits over 10 years, but it also expanded opportunities to monetize many of the energy tax credits through direct payment and transfer elections.
The BBA’s ‘ceases-to-exist’ rule in partnership termination transactions
Under the centralized partnership tax audit regime of the Bipartisan Budget Act of 2015, a buyer of a partnership interest can take certain steps to avoid a potential tax exposure related to uncertain tax positions for preacquisition tax years.
Massachusetts state tax implications for sales of PTE interests
When the sale of an interest in a PTE is contemplated, planning for state sourcing and taxability of the gain should both be considered so the owners avoid a large — and sometimes unexpected — state income tax liability.
Disguised sale of a QOZ partnership interest
Several structural issues arise when a QOZ project involves using both private developer capital and third-party investor equity.
Publicly traded partnerships: Investors’ tax considerations
Interests in publicly traded partnerships (PTPs) can be a valuable part of an investor’s portfolio, but because these investments are partnership interests, the tax reporting for them can be complex, and losses passed through by PTPs may be limited. This article discusses the tax compliance and loss limitation issues involved with, and tax planning considerations for, holding interests in PTPs.
State PTE elections: A big picture perspective
Practitioners may face a difficult analysis in helping their clients understand their possible PTE election opportunities.
Illinois PTE tax would provide SALT cap workaround
This item discusses Illinois Legislature’s S.B. 2531, which includes a PTE tax that allows a workaround to the federal $10,000 limitation for state and local tax deductions.
Where individual, corporate, and passthrough entity taxation meet
Passthrough owners must consider many risks and
uncertainties, in addition to political trends on Capitol Hill, before opting into a state-level regime designed to bypass the $10,000 SALT deduction cap created by the TCJA.
Using a family LLC for estate planning
LLCs can help families achieve key business and
tax objectives, while also providing liability protection and concentrating management power in
the hands of less than all of the owners.
The partner-to-partner attribution trap and the anti-churning rules
Taxpayers dealing with tax basis step-up transactions involving related parties or rollover equity interests should consider the application of the anti-churning rules to avoid unforeseen results.
Debt workouts involving commercial real estate
As short-term agreements that borrowers and creditors reached at the beginning of the pandemic start to expire, real estate companies and others
will need to find long-term solutions to their insolvency problem.
Partnerships and S corps. can deduct state and local taxes
The IRS said it would issue proposed regulations allowing S corporations and partnerships to deduct “specified income tax payments” paid to state and local governments above the line and not as passthrough items for partners and shareholders.
No deduction for donated easements with flexible reserved building rights
A taxpayer’s conservation easement deductions were denied because the easements allowed for changes in the use of the property.
Potential pitfalls of charitable contribution substantiation and reporting
Failure to properly complete all required fields on Form 8283, including the donor’s cost or other basis, could jeopardize the entire deduction with respect to the donated property.
Using R&D credits to reduce payroll taxes: An overlooked opportunity for startups
This article discusses who qualifies to take the credit, how to make the election, the calculation and allocation of the credit, and how to report it.
Lessee cannot take deduction for facade easement contribution
Because facade easements must be protected in perpetuity, a leaseholder was not allowed to claim a deduction for contributing an easement to a not-for-
profit preservation corporation.
IRS holds investment transaction is sale of refined coal tax credits
Investors in a partnership were not entitled to deduct credits because the investment transaction was structured solely to facilitate the purchase of the credits.
Charitable contribution substantiation procedures in statute not available in absence of regulations
A taxpayer’s substantiation requirements for a charitable contribution deduction were not met by information reported on the donee organization’s tax return.
Rules for Partnership Allocations of Creditable Foreign Taxes Are Amended
Temporary regulations issued by the IRS amend an existing safe harbor that is used for determining whether allocations of CFTEs are deemed to be in accordance with the partners’ interests in the partnership.
employee benefits & pensions
Profits interests: The most tax-efficient equity grant to employees
By granting them a profits interest, entities taxed as partnerships can reward employees with equity. Mistakes, however, could cause challenges from taxing authorities.
