Tax Warrior Chronicles

Stock Received on Option Exercise Taxable to Individual, Deductible by Company

Posted on Thu, Aug 29, 2013

In a recent case involving a family-owned S corporation (Allen L. Davis, et al., (CA 11 5/16/2013)), disharmony among family members, and whipsaw deficiency notices issued by the IRS, the 11th Circuit, affirming the Tax Court, held that the family patriarch had income of $36,962,694 from stock he received on exercise of an option, and that the company could deduct this amount.

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Appeals Court Rejects Retroactive Adjustments in Purchase Price Allocations

Posted on Tue, Aug 13, 2013

 

Peco Foods, Inc. & Subsidiaries v. Comm., (CA 11, 7/2/2013)

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Tax Court Denies Like-Kind Exchanges of Real Property for Fee Interests

Posted on Fri, Aug 02, 2013

 

The Tax Court recently issued TC Memo 2013-157, in which  it held that a leasehold interest in real property improved by a motel, with a remaining term of 21 years and 4 months, was not like-kind to two real property fee interests, one containing a motel and the other an office building, for which the leasehold was exchanged. The Court also rejected the taxpayer's alternative argument that the motel improvement to the transferred leased property was like-kind to the fee interests in the exchanged properties. Therefore, all realized gain on the exchanges had to be recognized.

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Temporary Alimony Payments Not Deductible Without Signed Agreement

Posted on Wed, Jun 26, 2013

 

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Independent Contractor or Employee?: Tax Implications for Employers

Posted on Wed, Mar 20, 2013

Taxpayers and businesses alike frequently find themselves in tax court over the question of whether a worker is an independent contractor or employee for federal income and employment tax purposes.  Jane Scaccetti, a D&S partner, in fact, recently tweeted about just such a case, in which a taxpayer lost his case. The question can be quite complex and the stakes can be very high. Let’s try to shed some light, in this brief blog, on some of the more obvious ways to determine on which side a worker may fall and what employers should do to comply with the law.

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"Limited Partner" for Tax Purposes? What are the Stakes?

Posted on Mon, Mar 18, 2013

This Journal of Taxation column, edited by Sheldon I. Banoff and Richard M. Lipton, comments on the IRS's and courts' positions on characterizing members of limited liability entities as "limited partners" and "general partners," for purposes of potential self-employment tax avoidance under Section 1402(a)(13).  

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Statute of Limitations Not Extended by Overstated Basis

Posted on Tue, May 01, 2012

Good news for S-Corporation owners who have sold property for large gains and possibly over-stated their basis in that property. In a case that has been going on for the better part of the last decade, the owners of Home Concrete & Supply, LLC (an S-Corporation) have won a victory over the IRS.

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