Finish that Rollover before Declaring Bankruptcy

In the recent case of In Re Jones, 123 AFTR 2d 2019-_________ (Bktcy. Ct. IL), an individual taxpayer and petitioner for bankruptcy relief under chapter 7 was able to withdraw $50,000 from his individual retirement account (“IRA”), deposit the funds into his personal account, spend $30,000 of the funds on personal items (primarily lottery tickets),…
Read More

Conservation in Bi-Partisan Crosshairs of Congress for 2019

On March 27, 2019, Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.) announced an investigation into potentially abusive syndicated conservation transactions. Senator Grassley commented on the investigation saying: ““There are very legitimate purposes for the conservation easement provisions of the tax code. But when a handful of individuals cook up a scheme to cash in at the…
Read More

Law Firm Technology – An Open Discussion

At our firm, we use a host of technological tools. As the attorney responsible for research, acquiring, and implementing our tools, I am required to invest a tremendous amount of time in our tools. This article changes pace a bit and may be geared to a different audience, our peers, in hopes to engage in…
Read More

IRS Addresses Estate and Gift Tax Exemption “Claw-back”

Overview As of November 23, 2018, the Internal Revenue Service (“IRS”) published proposed regulations providing some valuable guidance with respect to the upcoming sunset of the increased estate and gift tax exemption in the Tax Cuts and Jobs Act (“TCJA”). With the TCJA, the estate tax exemption amount was increased from $5.49 Million to $11.18…
Read More

High Stakes 1031 Goes Bust: Exelon

Background In a recent case out of the Seventh Circuit, a large corporate taxpayer lost a involving three like-kind transactions under IRC 1031. Applying the substance over form doctrine, the Court upheld the imposedtax liability of approximately $437,000,000 and accuracy related penalties under IRC 6662(a) of approximately $87,000,000. In this case, Exelon Corporation (“Exelon”) sold…
Read More

Another Technicality Attack by the IRS in Belair Woods

On September 20th, 2018, the Tax Court issued its memorandum decision granting a partial summary judgment in favor of the Internal Revenue Service (“IRS”). This decision arrives after a series of other decisions relating not about the traditional valuation disputes and battles of the experts, but instead a quick “gotcha” by the IRS negating the…
Read More

No, a Lessee Cannot Grant a Conservation Easement

In the recent Harbor Lofts case, the Tax Court clarified that a long-term lessee of real property is not entitled to take a deduction with respect to a grant of a conservation easement on that same property.With this case, we are reminded again that easements can be completely denied, even when a substantial interest in…
Read More

An Avalanche on Rose Hill: 5th Circuit Upholds Denial of Conservation Easement Deduction

On August 14, 2018 the 5th Circuit upheld the Tax Court’s September 9, 2016 bench opinion in PBBM-Rose Hill, LTD v. Comm’r. The case involved a $15,160,000 conservation easement deduction under IRC § 170(h) that was denied based on a technicality relating to strict compliance with the extinguishment regulations under Treas. Reg. § 1.170A-14(g)(6)(i) and a rejection of…
Read More

Estate Inclusion: The New Estate Plan, Step-Up

Background The traditional estate planning game has been to: (1) ensure client wishes were achieved by drafting wills and trusts such that the assets within the client’s estate served the intended purposes and landed in the hands of the desired beneficiaries, and (2) minimize or eliminate estate (and generation skipping) taxes. Since 2000, a few…
Read More