1. Topics

S Corporation, Partnership & LLC Taxation

PTE deduction: Timing issues for accrual-method taxpayers

taxpayers and practitioners face uncertainty regarding the timing of the deduction provided for in Notice 2020-75.

Navigating partnership continuations

This item discusses the rules and authorities related to partnership continuations and when they may apply.

Interaction of S shareholders’ loss limitations

Shareholder basis and other applicable loss limitations must be applied in a specified order, with differing rules.

Current developments in partners and partnerships

This article reviews and analyzes recent rulings and guidance involving partnerships. The discussion covers developments in the taxation of partnerships and partners, debt and income allocations, distributions, and basis adjustments.

Notice listing syndicated conservation easement transactions held invalid

Notice identifying syndicated conservation easement transactions as listed transactions is held invalid.

Dividing an LLC

The form of an LLC division determines the tax treatment of any resulting LLCs.

IRS provides guidance on perfecting S elections and QSub elections

The guidance focuses on nonidentical governing provisions; principal-purpose determinations regarding the one-class-of-stock requirement; disproportionate distributions; certain errors on forms; missing administrative or acceptance letters for an S or QSub election; and the requirement to file returns consistent with an S election.

The ‘one class of stock’ requirement: An interesting letter ruling

While it might stand to reason that if there is only one shareholder, then there can be only one class of stock, that is not necessarily what the Code and regulations provide.

FinCEN provides time estimates for compiling beneficial ownership details

FinCEN estimates that most companies will have a simple structure that will require 90 minutes per response, but complex entry filings will require much more time.

FinCEN proposes rules about access to beneficial ownership information

Proposed regulations under the Corporate Transparency Act address protocols for access to beneficial owner information by authorized recipients.

Prop. regs. to provide withholding relief on sales of foreign PTPs

The IRS announced that it will issue proposed regulations providing some relief to brokers that are required to withhold on the transfer of an interest in a publicly traded partnership (PTP) if the PTP is a foreign-traded entity.

Final regs. issued on centralized partnership audit regime

Final regulations, issued last week, except certain partnership-related items from the regime and provide alternative rules for their examination by the IRS, as well as provide rules for the calculation of imputed underpayments.

Domestic filing exception requirements modified in draft Scheds. K-2, K-3

Revised draft instructions for partnership and S corporation Schedules K-2 and K-3 contain significant changes to the requirements to qualify for the domestic filing exception for filing and furnishing the 2022 schedules.

Real property losses are capital, not ordinary

In Musselwhite, T.C. Memo. 2022-57, the Tax Court held that a taxpayer’s losses from the sale of four lots (real property) were ordinary in nature, as opposed to capital.

Inadvertent terminations of S and QSub elections

The IRS addressed a consolidated corporation’s request to apply Sec. 1362(f) to provide relief from termination of the corporation’s subsidiary’s S corporation and QSub elections.

Target capital account allocations in 11 easy steps

This item discusses the complexities encountered when working with partnership allocations under a target capital structured operating agreement.

10 good reasons why LLCs should not elect to be S corporations

The owners of an LLC may be tempted to have the LLC elect to be treated as an S corporation for federal tax purposes. However, there are a host of issues that should be considered before making this move. In this article, the authors discuss 10 reasons why it may not be beneficial for an LLC to make an S corporation election.

Real estate partnership restructuring and potential disguised sales

With certain restructuring transactions, careful consideration is needed to prevent the transaction from being deemed a disguised sale.

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.

Partnership examinations: Imputed underpayment modification

This item discusses how to request modification of an imputed underpayment.
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