If you’ve been around closely held businesses long enough, you know that a transfer of money between a business and its owner, or between two related businesses, is sometimes characterized by the parties as a loan (“related...more
Few individual owners of a closely held business would be surprised if you explained to them that the IRS and the Federal courts generally will subject many transactions between certain “related” persons to heightened...more
On November 2, 2017, Republicans in the House of Representatives released their long-anticipated tax reform bill (the “Bill”) which includes significant changes to the current U.S. federal income tax regime for businesses and...more
Many routine transactions occur between related parties, including the payment or accrual of interest on indebtedness, license fees, salary or benefits to employees and/or shareholders, and trade invoices. The Tax Court...more
“Add-Backs”- In the course of valuing a target business, a potential buyer will want to develop an accurate picture of the target’s earnings and cash flow. In doing so, the buyer will try to normalize those earnings by...more
Recently proposed Treasury regulations under IRC § 385 (the Proposed Regulations) would create sweeping changes to the federal income tax treatment of related-party debt. The Proposed Regulations could also have far-reaching...more
On August 6, 2015, the Department of the Treasury issued Notice 2015-54 (the Notice) announcing its intent to issue new regulations addressing transactions involving partnerships formed by related parties. According to the...more