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New Statute Provides Remedy for Overissuance of Stock
By on January 29, 2016
Often, shareholders of small and midsized corporations who also serve as the governing persons of those corporations must devote so much of their time and energy to business operations that corporate formalities may be overlooked and actions taken without proper approval. An example of such a situation is the issuance by a corporation of stock in excess of the number of authorized shares included in the corporation's Certificate of Formation, which happens more often than you would expect. Fortunately, a new amendment to the Texas Business Organizations Code ("TBOC") provides a relatively simple remedy for the overissuance of shares by Texas corporations.
IRS Says File 2015 Tax Returns As Soon As Possible or Criminals Will Do It For You
By on January 27, 2016
The IRS head criminal investigator, Richard Weber, had a message for all taxpayers while speaking at a conference on January 25th. "File early before the criminals file for you," Weber said. Weber explained that "current intelligence" indicates that criminal groups have amassed stolen taxpayer identification information to be used to file fraudulent refund claims during the 2016 filing season.
Decanting: Injecting Flexibility into Irrevocable Trusts
By on January 26, 2016
Irrevocable trusts restrict a beneficiary's access to assets. Generally, trusts are designed to provide trustees with sufficient flexibility to achieve the settlor's goals. However, until Doc Brown perfects the Flux Capacitor, the unforeseeable will occur and trusts, which were thought to be perfect in every regard at inception, will fail to achieve the settlors' goals.
U.S. Supreme Court to Resolve Lower Courts' Split on "Tippee" Insider Trading Criminality
By on January 22, 2016
The U.S. Supreme Court will review the Ninth Circuit's recent "tippee" insider trading case, United States v. Salman. The review is significant, because what's legal and what's not has become too unsettled - especially in the wake of the Second Circuit's 2014 decision in United States v. Newman and Chiasson.
Handling Taxpayers Who Have Forgotten Their Filing Obligations
By on January 20, 2016
We often encounter clients who have not filed tax returns for many years, some of whom have received a notice from the IRS regarding their non-filing status. Many times, these clients don't have the liquidity or even the assets to pay their delinquent tax obligations and end up applying for an Offer in Compromise (OIC).
Tax Court's Proposed Rule Changes and Clarifications Would be Welcome
By on January 19, 2016
Last week Chief Judge Michael Thornton announced a number of proposed changes and clarifications to the Tax Court's Rules of Practice and Procedure. Once finalized, and there is little reason to believe that they won't be, practitioners may want to adjust the ways they practice before the Tax Court. To assist in that transition, here is a summary of some of the key proposed revisions:
Deadlines for Information Reporting Required by the Affordable Care Act Extended
By on January 13, 2016
Internal Revenue Code sections 6055 and 6056 were added to the Internal Revenue Code by the Affordable Care Act and impose certain reporting requirements on minimum essential coverage providers and applicable large employers. The IRS recently issued Notice 2016-4, extending the due dates for the information reporting required by sections 6055 and 6056 for the 2015 calendar year.
Filing Dates have Changed for Some Tax Returns, FBARs and New Rules for Auditing Partnerships
By on January 11, 2016
Changes have been made to Partnership Tax Return and FBAR filing dates for 2016.
IRS Criminal Employment Tax Enforcement: The Next Big Thing
By on January 7, 2016
The IRS has experienced a 28% decline in collectors from 2010 to 2014. Meanwhile, the IRS estimates that $59 billion is owed from unpaid employment taxes from which employment tax returns have been filed. Additionally, taxes withheld by employers make up two-thirds of IRS revenue collection by the IRS. These factors converge for the perfect storm of IRS Criminal Tax Enforcement on payroll taxes.
Congress Passes "Game-Changing" Rules for Small Captive Insurance Companies
By on January 7, 2016
It's no secret that the IRS has been eyeing – closely – the small captive insurance industry. This industry embraces Section 831(b) of the Internal Revenue Code, which generally permits an electing insurance company with no more than $1.2 million of annual underwriting income to exclude such underwriting income from taxable income. In that case the insurance company is only subject to tax on its investment income. Back in February 2015, the IRS placed these small captive insurance arrangements on its "Dirty Dozen" list - a list of commonly-promoted techniques that the IRS contends are abusive tax shelters. This was part of a broader IRS crack down on the small-captive insurance industry, which has involved large-scale IRS examinations and promoter investigations and several test cases awaiting decision in the courts.
Spring Break in Mexico -- Think Again if you Owe the IRS
By on January 6, 2016
Was the Grinch in Congress last winter? The FAST Act, 2015 Fixing America's Surface Transportation Act, did much more than fix our nation's highways when enacted on December 5, 2015. The FAST Act broke down previous prohibitions that prevented the IRS from sharing information with the State Department.
