Tax Planning, Internal Revenue Code (IRC), Self-Employment Tax

Self-employment cannot be used as a tax smokescreen

IR Global on 3/3/2025

Self-employment cannot be used as a tax smokescreen for contracted employees A complex celebrity case arose recently in which the First-tier Tax Tribunal (FTT) was asked to consider the application of the intermediaries’...more

Another U.S. IRS Victory in the Self-Employment Tax Arena: Denham Capital Management

Hogan Lovells on 1/31/2025

For those keeping score at home, it’s currently two wins for the IRS in as many years, and nada/zilch/zero for the fund managers, at least when it comes to the limited partner exception for self-employment taxes (the “Limited...more

Tax Court Affirms “Functional Analysis” Test for Limited Partner Status

Cadwalader, Wickersham & Taft LLP on 1/28/2025

On December 27, the U.S. Tax Court issued an opinion declining to revisit its holding from 13 months earlier that a partner’s formal status as a “limited partner” under state law does not determine whether the partner is...more

Tax Court Reaffirms Soroban Holding that “Active” Limited Partners are Subject to Self-Employment Tax

Foley & Lardner LLP on 1/13/2025

On December 23, 2024, the Tax Court ruled in Denham Capital Management LP v. Commissioner (T.C. Memo. 2024-114), that limited partners that actively participated in the activities of a fund manager formed as a state law...more

For Tax Purposes, Are Limited Partners Really Limited Partners?

Falcon Rappaport & Berkman LLP on 4/17/2024

In Soroban Capital Partners v. Commissioner, the United States Tax Court determined that entities formed as state law limited partnerships did not necessarily mean that the limited partnerships’ limited partners were limited...more

‘As Such’: Soroban Case Puts Limited Partnerships Under Tax Scrutiny

DarrowEverett LLP on 2/14/2024

In Soroban Capital Partners, LP v. Commissioner, the U.S. Tax Court determined that the exception to net earnings from self-employment in Section 1402(a)(13) of the Internal Revenue Code of 1986, as amended (the “Code”) ...more

U.S. Tax Court: Limited Partner SECA Exception Requires Functional Analysis

Holland & Knight LLP on 2/5/2024

The U.S. Tax Court recently issued a precedential opinion in Soroban Capital v. Commissioner, holding that the limited partner exception to the Self-Employed Contributions Act (SECA) in Section 1402(a)(13) of the Internal...more

Limited in Name but Not in Tax? U.S. Tax Court Increases Tax Liability for Limited Partners

Kohrman Jackson & Krantz LLP on 12/8/2023

Certain limited partners in venture capital and private equity will likely see an increase in their tax liability due to a recent U.S. Tax Court decision. Generally, partners in a partnership and members in a limited...more

Tax Court Rules That Limited Partners May Be Subject to Self-Employment Tax

Troutman Pepper Locke on 12/6/2023

Summary - On November 28, the Tax Court, granting the Internal Revenue Service (IRS) summary judgment, held in Soroban Capital Partners LP v. Commissioner that a state law limited partner who is limited in name only, is...more

Tax Planning Under the Tax Cuts and Jobs Act: Flow-Throughs Are the Answer to Everything

Proskauer - Tax Talks on 11/14/2017

The tax reform bills introduced in the House of Representatives and the Senate dramatically reduce the corporate tax rate from 35% to 20% and create added incentives for taxpayers to invest capital into U.S. businesses with...more

Tax Planning › Internal Revenue Code (IRC) › Self-Employment Tax

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