Recent Texas Supreme Court Decision Addressing Treatment of Capital Losses for Texas Franchise Tax Apportionment Purposes Carries Significant Implications... [ read ]
In a recent decision with potentially broad implications, the Texas Supreme Court held in favor of a taxpayer on a question involving the treatment of capital losses for purposes of the Texas franchise tax.
Another Cautionary Tale for Executors, Trustees, and Beneficiaries: Liability for Unpaid Estate Taxes... [ read ]
The United States District Court for the Eastern District of California has issued an opinion finding that the executors of the estate, the trustees of the family trust, and the beneficiaries of the estate who received distributions from the estate are liable for unpaid estate taxes. United States v. Estate of Espinor, 2016 WL 2880191 (ED Cal. May 17, 2016)
Taxpayers Beware! Partnerships Should Consider Amending Their Agreements Now to Address Significant Issues Resulting From the New Partnership Audit Rules... [ read ]
As discussed in a recent blog post, a new partnership audit regime that was enacted as part of the Bipartisan Budget Act of 2015 (the "Partnership Audit Rules") will have significant, wide ranging effects on the taxation of income from partnerships. Under the Partnership Audit Rules, the general result (the "General Method") is that the tax liability resulting from an Internal Revenue Service ("IRS") audit adjustment to a partnership's income will generally be assessed and collected directly from the partnership. See I.R.C. § 6221 (2018). This is obviously a significant departure from the result under the partnership audit rules that are currently in place through year-end 2017 (the "TEFRA Rules"), under which an adjustment is made at the partnership level, but the resulting tax liability is assessed and collected from the partners of the partnership.
Master Limited Partnerships and Cancellation of Indebtedness Income... [ read ]
A Master Limited Partnership ("MLP") is an investment vehicle used in oil and gas, and several other industries. MLPs are designed to avoid corporate level taxation; however, this comes at a price that many investors have not anticipated.
Texas Bar Tax Section Issues Comments Regarding New Partnership Audit Rules... [ read ]
On April 26, 2016, the Tax Section of the State Bar of Texas ("Tax Section") submitted to the Internal Revenue Service comments (the "Comments") regarding the implementation of the new partnership audit regime (the "Partnership Audit Rules") that was enacted as part of the Bipartisan Budget Act of 2015. Stephen Beck of Meadows Collier participated as a principal drafter of the Comments in his capacity as Vice Chair of the Tax Section's Partnerships and Real Estate Committee.
The Clock is Ticking: U.S. Government Officials Investigate Panama Papers... [ read ]
Panama has long been known as a favorite country for many taxpayers on account of its low tax rates and strict confidentiality laws, the latter of which serve to protect the identities of Panamanian corporate shareholders and bank account holders in the case of frivolous civil litigation. Accordingly, it should come to no one's surprise that many non-Panamanian citizens take advantage of these low rates and confidentiality laws by creating Panamanian entities and utilizing the Panamanian banking system. Until recently, no one really knew how prolific the use of these entities was by non-Panamanian citizens or the extent to which they may be used by persons to avoid detection by taxing authorities and other governments. However, on April 3, 2016, the world got a glimpse of all of the above when a treasure trove of business records and documents relating to the formation and operation of Panamanian companies was released by hundreds of journalists from across the globe.
Navigating the Deferred Like-Kind Exchange Rules... [ read ]
Are you interested in obtaining §1031 like-kind exchange treatment upon disposition of a property but have not located suitable replacement property? You may be able to qualify for deferred exchange treatment under Reg. §1.1031(k)-1 but the Regulations will keep you on a very short leash.
Think You're Too Wealthy for a ROTH IRA? Think Again.... [ read ]
Excluding pensions and defined benefit retirement plans, there are two basic schemes for retirement accounts: one in which dollars are contributed pre-tax, grow tax deferred and are subject to income tax on withdrawal, and the other, where dollars are contributed after-tax, grow tax free and are not subject to tax upon withdrawal.
Captive Insurance and the 5th Amendment... [ read ]
An IRS summons enforcement recommendation was issued by a federal magistrate judge in Massachusetts on April 19th, where the summonsed witness appeared as required, but asserted his 5th Amendment privilege against self-incrimination in response to questions by the IRS. The case has a couple of interesting issues.
Does a Long-Term Relationship Indicate a Taxpayer's Reliance on a Tax Preparer was Reasonable?... [ read ]
Yes, in Vandenbosch v. Commissioner, the Tax Court listed the taxpayers' long-term relationship with their tax preparer as one of the facts supporting its decision that the taxpayer acted with reasonable cause.
