IRS Continues Aggressive Stance on Charitable Contributions

Overview In a recent Tax Court decision handed down in a Memorandum opinion, the Internal Revenue Service (“IRS”) showed that it will continue to be aggressive in denying charitable deductions for transactions they might view as taking abuse of the charitable deduction available under Internal Revenue Code (“IRC”) §170. In Chrem v. Comm’r, TC Memo…
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Melasky: When the Levy Breaks

Last week the Tax Court handed down its opinion in Melasky v. Comm’r, 151 T.C. 9 (Oct. 10, 2018). The important issue in Melasky relates to the application of the proceeds of a levy. Four days prior to the date the levy was made, the taxpayer hand-delivered a check to the IRS and properly designated…
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Asset Protection: Is Your LLC Creditor-Protected?

Background In the recent case of Golfwood Square, LLC v. O’Malley, 2018 WL 4370875 (Ill.App., Unpublished, Sept. 11, 2018), the Appellate Court of Illinois held that a creditor could reach assets of a subsidiary LLC to satisfy debts of its parent company’s owner. This is an important case to review in evaluating how to operate…
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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…
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Champions Retreat Denied Deduction for Golf Course Conservation Easement

The Tax Court recently struck down another conservation easement under Internal Revenue Code (“IRC”) IRC § 170(h). This case follows several other high-profile conservation easements that have been struck down recently. IRC § 170(h) and the related Treasury Regulations contain a myriad of technical requirements in order for an easement to qualify for the deduction,…
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The Intersection of the TCJA and the Mississippi Income Tax

The Tax Cuts and Jobs Act (“TCJA”) is arguably the most significant tax legislation passed by Congress since last revision of the Internal Revenue Code in 1986. The legislation fundamentally altered the Code by reducing or eliminating many longstanding, popular deductions and credits while expanding others and creating new ones. Much has been written about…
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The Importance of Being a “Trade or Business”

Introduction In tax planning, it always has been important to determine whether an activity qualifies as a “trade or business.” There are a number of consequences. An important consequence is being able to deduct “ordinary and necessary” business expenses under Sec. 162. Others are the applicability of the 3.8% net investment income tax, hobby loss…
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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…
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Estate Planning for Nontaxable Estates

In the wake of the Tax Cuts and Jobs Act, P.L. 115-97 (Dec. 22, 2018), estate planning has seen a return to its genesis. At its core, estate planning is about making sure assets pass to the right people, at the right time, and in the right manner. For most estates, the estate tax tail…
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199A Proposed Regulations: Clarifying Scope Of Specified Services Trade or Business Under Section 199A

The Internal Revenue Service (“IRS”) recently issued proposed regulations on the new deduction for qualified business income (“QBI”) under new Code section 199A. Among other things, the proposed regulations address the hotly debated interpretive issue regarding the term “specified service trade or business” (“SSTB”). SSTB is a key term under section 199A because, if an…
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