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IRS Form 8275: To Disclose or Not Disclose -- That Is The Question
By on September 4, 2019
At least once in their career most tax return preparers have faced the dilemma of whether and how to make a disclosure with a tax return. A disclosure is an extra explanation beyond the usual income and expenses shown on a tax return. Not surprisingly, most taxpayers do not want to disclose anything more than necessary to the IRS. There may be privacy concerns or they just don't want the IRS to know anything more than necessary about them or their business. They also may be concerned that a disclosure is a red flag and will increase the chances of an IRS audit. All of these are legitimate concerns, but a disclosure can protect the taxpayer -- and maybe more importantly the tax return preparer -- from penalties.
New IRS Ruling Shows the Dangers of Standard LLC Agreement Provisions When an S Election is Made
By on September 3, 2019
Most LLC agreements provide that distributions will be made to members in accordance with their positive capital accounts. In fact it is virtually boilerplate. So what happens when an LLC makes a Subchapter S election with this provision in its LLC agreement? You guessed it -- a second stock of class, and the need for IRS relief in resurrecting the S election, as a new IRS private letter ruling reveals.
