Taking business deduction for RV ends up costing taxpayers
Taking business expense deduction for RV is evidence of commercial use in warranty dispute.
LLCs and LLPs
Incorporating a single-owner business
Single-member LLCs and sole proprietorships must consider several unique issues when choosing to incorporate — including the tax consequences of transferring, or not transferring, assets into the newly formed corporation.
LLC mergers
When advising on a merger of LLCs, tax advisers must consider the application of state merger law, the continuity of the merged entities, and whether the merger constitutes an assets-over or assets-up transaction.
Classifying business entities under the check-the-box regulations
An entity that is recognized for federal tax purposes as an entity separate from its owners can be classified as one of several entity types, but the available classification options depend greatly on state law and the number of owners or members.
Electing S status by an LLC
A limited liability company can elect to be classified as a corporation and elect S status by following the procedures discussed here.
Optimal choice of entity for the QBI deduction
The enactment of the Sec. 199A QBI deduction adds a new consideration to the form of entity analysis because the QBI deduction available to a business owner may vary depending on a business’s entity form. This article discusses the differences in calculating the QBI deduction for S corporations and LLCs in a variety of scenarios.
Using a buy/sell agreement to establish the value of a business interest
Buy/sell agreements allow LLC members to control the transfer of ownership upon the occurrence of certain triggering events, but they must be carefully structured.
Phantom equity vs. profit interests: Strategic considerations
A practitioner who is a true trusted business adviser should consider what the business owner wants to achieve when making this decision.
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.
LLC owned solely by spouses: A partnership or a joint venture?
A timely election allows a married couple in business together to avoid the partnership filing rules.
Revisiting the application of Sec. 280G on partnerships and LLCs
Depending on how a taxpayer’s ownership is structured, the sale of a partnership interest can have a Sec. 280G impact on partners or members that are C corporations.
Loans between members and LLCs
A loan from an LLC member to the LLC must be structured carefully to ensure it is respected as bona fide debt.
Lender Management LLC and its impact on investment partnerships
Lender Management contended that its activities met the test for an active trade or business under guidelines.
Allocating LLC recourse debts
Regulations remove basis benefit for an LLC member when circumstances indicate a plan to circumvent or avoid debt payment obligation.
Dissolution of an LLC
Procedures for concluding the affairs of the LLC should be included in the operating agreement.
Practitioner’s incorrect change to passive status costly
A preparer’s improper change of status of income from active to passive is costly for taxpayers.
The trust fund recovery penalty and LLCs
A responsible person may be subject to the TFRP if it can be shown he or she willfully failed to pay the trust fund taxes due.
Liquidation of an LLC
Rules regarding gain or loss on liquidation are a major reason for formation as an LLC rather than as a corporation.
Debt Modification Issues for LLCs
Practitioners should be familiar with the cancellation-of-debt rules to ensure that modifications of an LLC's debts are not significant enough to cause the members to recognize income.
The Problematic Use of Transparent U.S. LLCs by Foreign Taxpayers
This item explores some common issues encountered by foreign taxpayers adopting transparent U.S. LLCs to invest or operate in the United States.
