In a letter to Treasury’s Financial Crimes Enforcement Network, the AICPA says the additional time will give all businesses a fair and reasonable time frame to become aware of the new and complex rule.
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TOPICS / PASSTHROUGHS
S Corporation Income Taxation
FinCEN continues outreach on BOI reporting, may release YouTube videos
The new head of the Financial Crimes Enforcement Network said the online videos, which she used in her previous government position, are among the communication options being considered to inform companies about beneficial ownership information reporting requirements.
Special per diem rate for business travel rises
Starting Oct 1, 2023, the special per diem rates taxpayers may use to substantiate ordinary and necessary business expenses for travel away from home will go up, the IRS announced.
FinCEN posts guide to help small businesses with BOI reporting
A new guide posted by the Financial Crimes Enforcement Network describes BOI rules, answers questions, and provides tools to assist with compliance with the BOI reporting rules.
Guidance issued on applicability and calculation of new corporate AMT
In advance of proposed regulations, the IRS provided interim guidance to help corporations determine whether they are subject to the new corporate alternative minimum tax and how to calculate the tax, including how to determine financial statement income and applicable financial statement income.
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.
Proposed PFIC regulations could complicate elections and reporting
Proposed regulations would extend to PFICs the aggregate treatment of U.S. partnerships and S corporations for Subpart F income.
Structuring stock dispositions to prevent S election termination
An S election can be at risk of termination by a shareholder’s disqualifying transfer of stock, but several safeguards are available.
Passthrough-entity treatment of foreign subsidiary income
Entities such as S corporations and partnerships, as well as sole proprietorships, should carefully consider the U.S. tax treatment of foreign subsidiaries.
AICPA advocates for delay in BOI reporting requirements
Too many businesses are unaware of the beneficial ownership information reporting requirements, which will be a burden for small businesses, the AICPA told Congress.
Current developments in S corporations
This annual update covers recent developments relating to S corporations, including new IRS relief for common inadvertent S election lapses; state passthrough entity taxes; and court holdings concerning S corporations’ constructive distributions and passive versus nonpassive activities.
Stock repurchase excise tax reporting and payment delayed by IRS
The IRS says covered corporations will not have to report or pay the new 1% stock repurchase excise tax until it issues forthcoming regulations.
Penalty for underpayment of estimated corporate AMT waived for 2023
The IRS waived the penalty for corporations that did not make estimated payments of corporate AMT for their 2023 tax year, saying the move is “in the interest of sound tax administration.”
Interaction of S shareholders’ loss limitations
Shareholder basis and other applicable loss limitations must be applied in a specified order, with differing rules.
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.
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.
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.
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.
Rolling over shares upon S corporation’s acquisition
This item discusses nonprorated S corporation rollovers and the unexpected tax consequences.
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.
