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By on April 21, 2020
In one of three recent decisions issued by the Texas Supreme Court involving the Texas franchise tax, the Court held that certain costs associated with the rental of heavy construction equipment could not be included in the cost of goods sold deduction.
By on April 13, 2020
In the recent case of American Multi-Cinema, Inc. v. Hegar, Cause No. 17-0464 (Tex. Apr. 3, 2020), the Texas Supreme Court held that a taxpayer engaged in exhibiting movies in movie theaters could not claim a cost of goods sold for the costs it incurred in exhibiting its movies. This case, which has been closely monitored by taxpayers and practitioners alike, addresses important questions regarding the definition of "tangible personal property" for cost of goods sold purposes. The Court ultimately concluded that American Multi-Cinema, Inc. ("AMC") did not qualify for the cost of goods sold deduction because it did not sell tangible personal property.
IRS Provides Partners and Partnership Tax Professionals Relief in Rev. Proc. 2020-23
By on April 9, 2020
For those partnerships who had not elected early application or validly elected out, the 2018 tax year was the first year in which the new partnership audit rules, enacted by the Bipartisan Budget Act of 2015 (the "BBA"), took effect.
COVID-19 – EXCUSAL FROM PERFORMANCE UNDER THE TERMS OF A CONTRACT
By on April 9, 2020
Businesses across Texas are facing many uncertainties with several counties and municipalities ordering citizens to either "shelter–in–place" or "stay–at–home" and banning gatherings of more than 10 people, all in an attempt to slow the spread of the novel coronavirus, also known as COVID-19. As a result, many non–essential businesses whose employees are unable to work remotely and/or scheduled events with attendance of more than 10 people being cancelled or delayed are expressing their concern about little to no incoming revenue. Such business owners are requesting guidance as to whether their performance will be excused pursuant to the terms of their commercial contracts.
By on April 8, 2020
In one of three recent cases addressing the Texas franchise tax, the Texas Supreme Court held that a company engaged in performing work on offshore oil-and-gas drilling rigs could not claim a cost of goods sold deduction with respect to certain costs incurred with that work, but could exclude payments to subcontractors from total revenue.
TAX STIMULUS PROVISIONS OF THE CARES ACT
By on April 7, 2020
In addition to the PPP loan program, the CARES Act has implemented various tax stimulus provisions for individuals and businesses, including retroactive temporary deferral, or modification of certain loss deduction limitations added by the Tax Cuts and Jobs Act.
By on April 6, 2020
A key portion of the Coronavirus Aid, Relief, and Economic Security Act ("CARES") is an expansion of the SBA's Section 7(a) loan program aimed primarily at businesses with fewer than 500 employees.
Texas Supreme Court Issues Three Decisions Addressing Various Aspects of the Texas Franchise Tax
By on April 6, 2020
In a monumental day for Texas franchise tax, the Texas Supreme Court issued on Friday, April 3rd, three much-anticipated decisions addressing different aspects of the Texas franchise tax.
Recent Microcaptive Letters are an IRS Gift in Disguise
By on April 2, 2020
I recently blogged on the IRS' mass mailing of soft-contact letters to microcaptive participants. Although perceived as a nuisance, it is an early Christmas present from the IRS – the gift of time to assess the planning, shore up defenses, and in some instances, to remediate.