The Tax Consequences of Family Business Transactions

Parents are often in a position to help their children take advantage of business opportunities. A parent’s connections, business knowledge, expertise, and other intangibles acquired over may years of work can be used to benefit a child starting a career or business. Likewise, a parent may advance funds to a child to start or acquire…
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IRS Leaves $155.5 Million Lump of Coal for Faulty Easement Deed

On October 28, 2019, the Tax Court released its opinion in Coal Property Holdings, LLC v. Comm’r, 153 T.C. No. 7 (2019). This case comes at a sensitive time of year where deadlines are looming in order to file conservation deeds to qualify for the deduction under Section 170(h), relating to qualified conservation contributions, for…
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All about that basis, about that basis, no gains

The Tax Cut and Jobs Act (“TCJA”) enacted some sweeping changes to our nation’s tax laws. One major change was the modification of Section 2010 to increase in the individual estate tax exemption from $5M, indexed for inflation ($5.49M in 2017), to $10M, indexed for inflation ($11.2M in 2018, 11.4M in 2019). Thus couples went…
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Can You Avoid Creditors by Moving Assets (or Yourself) to Another State?

A couple of recent cases illustrate situations where moving assets from one state to another may have the effect of shielding those assets from creditors. In both of the cases, judgment debtors moved assets to another state and succeeded in avoiding enforcement of the judgment. In re Cleopatra Cameron Gift Trust, a California Judgment Against…
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Tales from the Crypto: Rev. Rul. 2019-24 and New FAQs Released by IRS

On October 9, 2019, the Internal Revenue Service (“IRS”) released its latest buzzkill, Rev. Rul. 2019-24, answering questions involving hard forks of cryptocurrency, which, as explained more below, is where a new type of cryptocurrency is created and there is a permanent diversion from legacy currency or existing distributed ledger. In conjunction with the release…
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The Sale of a Business – Part 5: The Closing

One of the more common engagements for our firm is to assist with business sales and acquisitions. This article is the fifth in a series of articles which will walk through and generally discuss the steps typically associated with the sale of a business. In Part 1, we discussed the breakdown of the business, the…
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IRS Provides Automatic Relief from Underpayment Penalties

In 2018, taxpayers enjoyed an increase in take-home pay as a result of revisions to the Internal Revenue Service (“IRS”) withholding tables that decreased the amount of federal income taxes withheld from their paychecks. The revisions to the withholding tables were made to reflect changes from the Tax Cuts and Jobs Act of 2017 (“TCJA”).…
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Higher Scrutiny for Tax Professionals: In Re Benavides

The Tax Court has just ruled against a CPA in a case involving income tax, self-employment tax, deductions for personal expenses, fraud, and other items. The CPA at issue, Al Benavides, had previously been criminally convicted for assisting a client in evading income tax liabilities. Although there are a number of substantive issues in the…
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IRS Stirring the Pot Again with Micro-Captives: Settlements Announced

On September 16, 2019, the Internal Revenue Service (“IRS“) announced that it would be mailing settlement offers for certain taxpayers under audit who participated in “abusive” micro-captive insurance transactions. The micro-captive transactions were listed as a transaction of interest by the IRS back in 2016. Section 2 of Notice 2016-66 described the transaction itself as…
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The Sale of a Business Part 4: Definitive Agreements

One of the more common engagements for our firm is to assist with business sales and acquisitions. This article is the third in a series of articles which will walk through and generally discuss the steps typically associated with the sale of a business. In Part 1, we discussed the breakdown of the business, the…
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