The IRS delays e-filing capability for schedules reporting S shareholders’ items of international tax relevance, earlier forecast for mid-June, to July 24.
S Corporation Income Taxation
In eight new FAQs on its website, the IRS covers some special issues, including several that it says will be added to the forms’ instructions.
AAA and AE&P calculations are key to determining stock basis and, thus, the taxability of shareholder distributions.
S corporation stock was not subject to a substantial risk of forfeiture because the stock forfeiture provision was unlikely to be enforced.
The IRS, citing earlier problems e-filing a new form reporting S corporation owners’ basis, has granted relief to certain farmers and fishermen who missed their March 1 filing deadline.
What partnerships, S corporations, and others with foreign partnership interests need to know for tax year 2021 and beyond.
stock and debt basis under Sec. 1366(d)(1). Failing to properly track basis may require a recomputation of the shareholder’s basis.
To be deductible at the entity level, payments by passthrough entities of state and local taxes should be made in the tax year of the liability, but state-specific elections may complicate that timing, tax advocates advise.
To avoid the hobby loss rules, with their limitation on deductible expenses, an activity must be engaged in for profit; electing S status can help a taxpayer establish profit motive.
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.
The issue of a stock sale versus an asset sale raises a number of significant issues to be considered by S shareholders.
This update on recent developments in taxation relating to S corporations includes cases and rulings on eligible terminated S corporations, S corporation income and losses, the one-class-of-stock requirement, and other issues.
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.
Economic benefits from a compensatory split-dollar life insurance arrangement are not property distributions.
Covenants not to compete can protect a company’s interest as long as they are drafted in an appropriate manner, but their 15-year amortization period can cause issues.
When the basis in an S shareholder’s loan to the S corporation has been reduced by passthrough losses, repayment of the loan may be a taxable event.
In a letter dated March 15, the AICPA asked for IRS guidance on how S corporations and partnerships should treat tax-exempt income from PPP loan forgiveness, especially when it occurs during a different tax period.
IRS Notice 2020-69 provided a new entity election that allows an S corporation to compute the deemed inclusions at the entity level, as opposed to at the shareholder level. This item provides background on the new election, illustrates its effects, and highlights opportunities and traps to consider when contemplating the election.
The IRS issued final regulations on ETSCs and distributions of money from those corporations after the post-termination transition period.
The built-in gains tax applies to C corporations that make an S corporation election, and it can be assessed during the five-year period starting with the first tax year for which the S election is effective.