1. Topics

S Corporation, Partnership & LLC Taxation

Current developments in S corporations

This update on recent developments in taxation relating to S corporations includes cases and rulings on eligible shareholders, electing small business trusts, inadvertent S election terminations, and other issues, as well as changes made by the TCJA.

IRS finalizes centralized partnership audit regulations

The IRS issued final regulations on the centralized partnership audit regime, which generally assesses tax at the partnership level.

Current developments in partners and partnerships

This article reviews and analyzes recent rulings and decisions involving partnerships and discusses developments in partnership formation, debt and income allocations, distributions, and basis adjustments.

IRS takes narrow view of aggregation under the at-risk rules

The IRS concluded that a taxpayer was not permitted to aggregate the S corporations with the partnership for the purpose of applying the at-risk rules of Sec. 465.

Repeal of technical terminations: What will and will not be missed

With the repeal of technical terminations, partnerships can only terminate for U.S. federal income tax purposes if no part of any business, financial operation, or venture continues to be conducted by any of its partners.

Understanding the effect a partnership agreement has on allocations

If the partnership agreement’s tax allocations do not have substantial economic effect, or if the partnership agreement is silent concerning tax allocations, the tax allocation must be made in accordance with the partners’ interests in the partnership.

Issues and considerations in appointing a partnership representative

This item discusses issues partnerships and their advisers should consider when designating a PR or DI, accounting for the potential for conflicts of interest, whether and to what extent limitations can be placed on the PR or DI, and how these roles differ dramatically from that of the TMP.

Economic benefits of life insurance premium payments are not includible in income

Economic benefits from an S corporation’s payment of a premium on a life insurance policy were not includible in the shareholder/employee’s income.

Capital contribution of reduced basis S corporation debt

The passthrough of S corporation losses to the extent of the shareholder’s basis in his or her stock and debt can be beneficial, but the resulting reduced basis debt may lead to taxable income on repayment of the debt.

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.

A uniform state approach to the new federal partnership audit regime

Broad state adoption of the model statute developed by the AICPA in partnership with other major stakeholders will provide greater uniformity and increased compliance.

Converting from an S corp. to a C corp.

This item discusses the many tax ramifications of converting.

Amended returns satisfy statement-of-inconsistency requirement

A taxpayer’s amended returns sufficiently apprised the IRS of inconsistencies between the amended returns and the returns filed by the bankruptcy trustee of his wholly owned S corporation.

Filing a timely S election

Many factors must be considered when electing S status for a new corporation or converting an existing C corporation to ensure a timely election.

Changing from cash to accrual accounting after revoking an S election under TCJA

A terminated S corporation may remain a cash-basis taxpayer if its average gross receipts for the three previous tax periods are less than $25 million.

Prop. regs. restore allocation of partnership liabilities in disguised sales

Disguised sale occurs when a partner(s) engages in a transaction that, when viewed together with a partnership, involve property and are characterized as the sale or exchange of property.

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.

Loan guarantee does not increase S corp. shareholder’s debt basis

This item discusses how a back-to-back loan is a viable option for shareholders who want to increase their debt basis in an S corporation.

Shareholder cannot unilaterally change an S corp.’s election

Regulations explicitly require elections to be made by the corporation, and shareholders themselves cannot change these elections.

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.
Next
Previous