Tax Warrior Chronicles

Understanding REITs and Their Place in Your Portfolio

Posted on Fri, Mar 06, 2020

By: Stuart Shikiar, Albert Sipzener, Lockwood Sloan and Sam Shikiar

 

Real estate has been a time-tested addition to investor portfolios. Real Estate Investment Trusts, or REITs, provide an opportunity for tax-advantaged income investing. Today’s post features a discussion by the team at Shikiar Asset Management, a New York-based registered investment advisor and long-time friend of Drucker & Scaccetti.  Here is what they have to say about REITs…

 

Real Estate Investment Trusts (REITs) have been a central component of our strategy for several years. REITs offer investors the benefits of exposure to real estate coupled with the ease and advantages of investing in publicly traded equities,

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IRS Hones in on Partial Asset Disposition Deductions

Posted on Fri, Jan 17, 2020

By: Ashley Menders

 

On November 6, 2019, the IRS released a process unit to train and educate its agents on partial asset dispositions of a building. The release of this educational material to its employees may indicate IRS intent to target these deductions for examination, which are common in the real estate industry. Before we address this development, we'll first give you a refresher and explain the information your tax preparer needs to determine if you may benefit from the deduction. Finally, we'll address risk mitigation, given the recent IRS pronouncement.

 

What is a Partial Asset Disposition?

As part of the Tangible Property Regulations (TPR) released in 2013 that overhauled how

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The New Tax Law: 2018 Year-End Planning Tips for Businesses

Posted on Wed, Nov 28, 2018

By: Joseph Brunell, CPA

 

The Tax Cuts and Jobs Act (TCJA) was signed into law on December 22, 2017, and became effective on January 1, 2018.   For many businesses, the TCJA provides benefits such as reduced corporate tax rates, removing the corporate alternative minimum tax, and a new pass-through business income deduction.  However, many tax planning ideas go beyond the big-ticket items.  The Tax Warriors® at Drucker & Scaccetti are here to provide some of the top year-end tax planning tips.

 

Take advantage of business expensing under Section 179

 

Generally, taxpayers can elect to immediately expense up to $1 million of business tangible personal property placed into service after

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The Basics of Becoming a Business Partner

Posted on Thu, Mar 16, 2017

By: Irina Moyseyenko, CPA, MT and Kim Racer Robinson, EA

 

You’ve been offered an opportunity to invest in a partnership; or perhaps you’ve been  promoted to partner at your law, accounting or architectural firm.  After spreading the good news to everyone, you come to grips with the great unknowns. What does it mean to be a partner? How will my financial life change? Below, we review a few things to consider before signing on the dotted line.

 

Know the Financial Shape of the Entity

If you buy into a business partnership, you become an owner.  As a potential owner, you should know what the business owns, how much it owes, and how it generates cash flow.  Review the partnership’s books and

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Are You in the Business of Flipping Houses?—Tax Court Answers This Real Estate Question

Posted on Thu, Dec 04, 2014

Issachar Ohana, et ux. V. Commissioner, TC Memo 2014- 83

In a recent decision, the U.S. Tax Court concluded that a taxpayer was not in the trade or business of flipping properties and, therefore, wasn’t entitled to take deductions under Internal Revenue Code (“IRC”) Section 162 for the improvements to two properties he owned. In this case, the taxpayer failed both the continuity and regularity test and the primary purpose test used to determine if a taxpayer is engaged in a trade or business. The Court also upheld the substantial understatement penalty under IRC Section 6662 stating it was not reasonable for the taxpayer to rely on his tax preparer and that the taxpayer did not act in

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