Ledgers and Law: Start With an Ending in Mind When Building a New Business
THE ACCIDENTAL ENTREPRENEUR
Investment Management Update – Exit Strategies
Lawyers on Tap: Tap Tips for Entity Formation and Taxation
Many closely held businesses operate through entities classified as “S corporations,” an elective federal income tax regime that combines elements of corporate and partnership taxation. Among other reasons, S corporations are...more
Last month, Bloomberg carried an article about a “small but growing trend” of states that are either cutting their individual income taxes or phasing them out entirely. According to the article, the states adopting these...more
Section 1202 provides for a substantial exclusion of gain from federal income taxes when stockholders sell qualified small business stock (QSBS). But a number of requirements must be met before a stockholder is eligible to...more
Don't stick your head in the sand and miss important business or personal tax deadlines...more
When considering converting a C corporation to an S corporation, tax advisers and taxpayers need to pay careful attention to the many perils that exist. Failure to pay close attention to the road in this area could result in...more
For an active business in the post-Tax Cuts and Jobs Act (TCJA) world of lower corporate tax rates, buyers and shareholders considering a future exit should always consider C corporations and the availability of potential...more
On June 20, 2024, the Supreme Court released its opinion in Moore et ux v. US, authored by Kavanaugh, decided by 6-3 vote and marking a rare instance for the Court to interpret the 16th Amendment, upholding the...more
In the S corporation arena, tax advisors generally do not focus much attention on unreasonable compensation. As we delve into the issue in this Part VII of my multi-part series on Subchapter S, it will become apparent that...more
In Leto v. United States, the taxpayer reincorporated an S corporation business into a C corporation, then the taxpayer later sold the shares in the C corporation and tried to exclude the gain from such sale under section...more
This sixth installment of my multi-part series on Subchapter S is focused on the revocation of an S corporation election. While the rules relating to revocation are fairly straightforward, there are a few nuances that may...more
This article provides some brief insight surrounding the initial steps in making an S election. The entirety of issues that may arise can often be mitigated, if not entirely avoided, with proper tax planning. The scope of...more
Qualified Small Business Stock (“QSBS”) is arguably one of the largest “gifts” Congress has given taxpayers by excluding from a shareholder’s gross income the greater of $10 million or 10 times the shareholder’s basis in the...more
Last week, Sen. Warren reintroduced her “Ultra-Millionaires” wealth tax proposal to the Senate. Query her timing. The measure has the proverbial snowball’s chance in Hell of being enacted by this Congress.Perhaps the Senator...more
Acquiring a business can be a strategic move to grow, diversify, or compete in the market. Acquisition also involves significant tax implications that can affect the value and structure of the deal. Therefore, it is crucial...more
The IRS recently provided guidance addressing inadvertent terminations of S Corporation (S Corp) status based on existing provisions in corporate documents that remain after a company makes an S Corp election. This can be a...more
KEY FACTS OF REAL ESTATE ACQUISITIONS UNDER MICHIGAN LAW - I. STANDARD FORMS OF AGREEMENTS - A. Offers to Purchase that are accepted by sellers are the typical form of purchase contract for residential properties....more
This second installment of my multi-part series on Subchapter S is focused on two Code Sections, namely IRC Section 1375 and IRC Section 1362(d)(3)....more
Before founders can kick-start operations, bring in customers, or engage investors, they are advised to create a legal entity to pursue such milestones. Establishing a legal entity serves several key purposes: the founder can...more
KEY FACTS OF REAL ESTATE ACQUISITIONS UNDER MICHIGAN LAW - I. STANDARD FORMS OF AGREEMENTS - A. Offers to Purchase that are accepted by sellers are the typical form of purchase contract for residential properties. The...more
I. Introduction F reorganizations, much like the game of Othello, can take a minute to learn but a lifetime to master. They are often a critical part of structuring the purchase and sale of S corporations. As part of an F...more
This webinar will go into detail about the advantages and disadvantages of using an F-reorganization as a tax strategy when selling your S-Corporation and will discuss the following topics: - What is an F-reorg for...more
Limited liability companies (LLC or LLCs) are an attractive choice of entity for many non-public companies. An LLC is the preferred choice of entity for many advisors, including me, unless the facts warrant something...more
Once you have a business idea, creating a business entity may seem daunting from a legal standpoint. However, setting up your business with thoughtful consideration and guidance will pay off over time, as you can...more
Partnerships are ineligible S corporation shareholders. So, a partnership cannot acquire shares in an S corporation without terminating that corporation’s S election. However, a partnership can still invest in an S...more
Don’t Do It- There are certain generally accepted “dos and don’ts” of which almost every investor is certainly aware. For example, do not put all your eggs in one basket; if an investment seems too good to be true, stay...more