Treasury published long-awaited proposed revisions to the existing I.R.C. Section 2704 regulations on August 4, 2016. 81 Fed. Reg. 51413 . If published as final regulations in current form, the revisions will inhibit transfers of closely-held business interests to family members. Treasury provided a reprieve by postponing the effective date of the proposed regulations until such time as they are published as final regulations...

INTRODUCTION When the Tax Reform Act was enacted 30 years ago, Congress was able to implement major tax reform by collaborating across bipartisan lines. [1] It was the last time the Internal Revenue Code underwent a major overhaul, and the elements that came together to create such a major change have proven quite elusive during the past three decades. [2] As we move toward the November election, tax policy and tax...

by Mark A. Muntean * Introduction A new law allows the Internal Revenue Service ("IRS" or the "Service") to revoke or deny passports for certain taxpayers who owe unpaid federal taxes. This change to the tax law was included in the Fixing America's Surface Transportation Act, ("H.R. 22"), which was signed into law on December 4, 2015. [PL 114-94, Title XXXII Offsets, Subtitle A...

by Jessica L. Kerner, J.D., LL.M. * In 2007, a hotel room shortage in San Francisco prompted two roommates to create a website to rent out air mattresses in their apartment. Less than eight years later, the company they founded, Airbnb, has been valued at more than $25 billion. ["Value of Airbnb Hits $25.5 Billion with Latest Round," The Wall Street Journal (June 29, 2015).] The success of Airbnb is mirrored...

by William H. Byrnes IV and Marvin Petry * @ A multinational enterprise is ordinarily organized as a parent company having subsidiaries, branches, or joint ventures in foreign locations where the enterprise may have employees, agents, business assets, or customers. The parent and its subsidiaries are potentially subject to taxation on some part of the enterprise's income in any jurisdiction where factors of production...

by Marc T. Finer and Ryan M. LoRusso Albert Einstein once said “[t]he hardest thing in the world to understand is the income tax." Nowhere is this truer in the Internal Revenue Code than in the context of the recourse versus nonrecourse liability rules of Subchapter K (partnership tax). Unfortunately, for those of us who eventually do master these rules, a recent IRS Chief Counsel Advice (CCA) 201525010...

by Marc T. Finer , William J. Kambas , and Ryan M. LoRusso A captive insurance company is an insurance company formed primarily or exclusively to insure the risks of one or more affiliated businesses. Many larger companies form captive insurance companies for the purpose of insuring against risk which is commercially uninsurable or for which the cost of insurance protection is unreasonable. However, captive insurance...

By Suellen M. Wolfe * The Patient Protection and Affordable Care Act (hereinafter referred to as ACA) [PL 111-148, 124 Stat 119 (Mar 23, 2010)] provides for health care reform law in the United States. The ACA consists of the Affordable Health Care for America Act, the Patient Protection Act, health care related sections of the Health Care and Education Reconciliation Act, and the Student Aid and Fiscal Responsibility...

The IRS and Treasury have issued Notice 2015-79, 2015 IRB LEXIS 583 (Nov. 19, 2015) , announcing the government’s intention to issue additional regulations targeting corporate inversion transactions. The initial announcement of the government’s plan to issue regulations addressing inversion transactions was in Notice 2014-52, 2014 IRB LEXIS 576 , issued in September 2014, and the new notice follows-up on the...

Identity theft is an increasing problem that can potentially affect any individual or business. The IRS, FBI, and FTC have published information for individuals and businesses for the prevention, detection, and correction of identity theft. … In the past year, the IRS has published a substantial amount of information pertaining to this subject. The irs.gov website contains a wealth of material on identity...

by Sheryl Phipps * Birkenfeld Case On September 11, 2012, the Internal Revenue Service (IRS) paid former Union Bank of Switzerland (UBS) banker Bradley Birkenfeld $104 million in awards for assisting them in collecting more than $5 billion in unpaid taxes. Birkenfeld received the funds pursuant to whistleblower statute IRC Section 7623(b) . ... Brad Birkenfeld... was sent by UBS to lure U.S. investors from...

by Lawrence A. Kogan* The Foreign Account Tax Compliance Act of 2010 (FATCA) and its regs impose certain information gathering, reporting and withholding requirements on nonfinancial foreign entities (NFEEs) operated by U.S. taxpayers overseas. In part, FATCA is intended to address difficulties that authorities have had with identifying US beneficial owners of US source income paid through foreign entities. ......

by Edward W. Stepnick, CPA, continuing professional education consultant on government accounting and auditing, Venice, FL. Revised and updated by G. Robert Smith, Jr., Associate Professor of Accounting, Middle Tennessee State University, and Dwayne N. McSwain, Assistant Professor of Accounting, Appalachian State University. ... Introduction The United States economy is comprised of two major sectors: the private...

by Harvey L. Frutkin, J.D. Partner: The Frutkin Law Firm, PLC, Phoenix, Arizona. ... The furnishing of goods, services, or facilities between a plan and a "party in interest" to the plan is generally prohibited under ERISA. [ERISA § 406(a)(1)(C)]. As a result, a service relationship between a plan and service provider would constitute a prohibited transaction, because any person providing services to...

by Diane L. Mutolo * ... On Jan. 1, 2013, a 3.8% net investment income tax on individuals and estates & trusts, enacted as part of the Health Care and Education Reconciliation Act of 2010 (Pub L No 112-152, 111th Cong, 2d Sess (March 30, 2010)) takes effect... IRC Section 1411 ... will provide additional funding to Medicare ["Technical Explanation of the Revenue Provisions of the 'Reconciliation Act...

by Mary Howley, Esq . * Deduction limits apply with respect to compensation in excess of $1,000,000 per year for covered employees of any publicly held corporation. A limit also applies for remuneration in excess of $500,000 paid by certain health insurance providers. Financial institutions that participated in the troubled assets relief program (TARP) are limited to a $500,000 per year deduction for covered executives...

* by Lawrence A. Kogan, Esq. FATCA's Objective The Foreign Account Tax Compliance Act ("FATCA"), which added new Chapter 4 to Subtitle A of the Internal Revenue Code (comprising Sections 1471 , 1472 , 1473 , and 1474 ) was signed into law on March 18, 2010 by President Obama as part of the Hiring Incentives to Restore Employment Act of 2010, P.L. 111-47 . FATCA's objective is to help "plug"...

by Richard B. Robinson * IRC Section 1411 imposes a new Medicare tax on the net investment income of individual taxpayers. The tax is equal to 3.8 percent of the lesser of: the taxpayer's net investment income or the taxpayer's modified adjustment gross income over the threshold amount. An S corporation is not subject to the new Medicare tax, but each individual shareholder will compute his,...

by Nicholas L. Raby, Susan W. Stanley and Elizabeth A. Sweigart * Although the majority of U.S.-based multinational enterprises make efforts to document and charge for headquarters general and administrative services provided to foreign affiliates under Treas. Reg. § 1.482-9 , not all taxpayers are aware of steps needed to protect themselves from disallowed deductions... The majority of U.S.-based multinational...

By Suellen Wolfe, J.D., LL.M. * In 2011, IRS adopted final regs on indebtedness satisfied by receipt of a partnership interest and application of IRC §108(e)(8)(B) to partnerships and their partners. The regs provide guidance on determining discharge or cancellation of indebtedness income incurred by a partnership on the transfer of a partnership interest to a creditor in satisfaction of partnership debt. This...

By Kimberly Stanley, J.D., LL.M. * In Mayo Found. for Med. Educ. & Research v. United States , 131 S. Ct. 704 (U.S. 2011) , the U.S. Supreme Court addressed a narrow tax issue involving medical residents and Social Security tax on wages. The issue was part of a larger discussionregarding the validity of federal regulations. In United States v. Home Concrete & Supply, LLC , 132 S. Ct. 1836 (U.S. 2012) , the...

An estate fiduciary may be held personally liable for the estate's unpaid taxes. IRC § 6901 provides that the government may collect a fiduciary's liability under the Federal Priority Statute (31 U.S.C. § 3713) for an unpaid claim of the Government. In three recent U.S. district court cases, the courts considered the personal liability of estate representatives... ... ... Under IRC Section 6901...

The tanning tax was... stuck at the end of a 906-page health care reform bill. Moreover, it was, indeed, intended to be a revenue-generating provision, though even at best, it was projected to generate less than one percent of the money needed to fund the legislation. ... [1] Scope of the Indoor Tanning Excise Tax The tanning tax is a ten percent excise tax on indoor tanning services. [ IRC § 5000B ....

By Darrell Oyer Publicly traded companies and many other companies must report financial data in accordance with established financial reporting requirements. These same companies must also file tax returns with the Internal Revenue Service (IRS). If the company has Federal government contracts, there is also a set of rules for reporting costs (Federal Acquisition Regulation or FAR) under those contracts, and larger...

By Darrell Oyer The cost accounting regulations for contracting with the Federal government consist of many pages 1 of detailed principles, practices, rules and regulations, despite the fact that existing cost principles exist in the U.S. Generally Accepted Accounting Principles (GAAP) as well as in international accounting principles. Why is all this necessary? Do these detailed directions add value to the Federal...