The Internal Revenue Code provides the IRS with authority to waive the 60-day IRA rollover requirement “where the failure to waive such requirement would be against equity or good conscience, including casualty, disaster, or other events beyond the reasonable control of the individual subject to such requirement.” See generally Accepting Late Rollover Contributions. The IRS…
Takeaway: While S corporations can be an effective means to reduce FICA taxes, the form of the arrangement must be consistent with the taxpayer’s intended reporting position(s). The S corporation, not the S corporation’s employee-shareholder, must be in control of the receipt of income in order shift income from the shareholder’s personal income tax return…
Overview How can a corporation have a loss for tax purposes if it does not have any bank accounts, credits cards, or other lines of credit and it does not keep any books or records? The taxpayers in Rochlani v Commissioner found out the hard way.[1] Business Formation and Operations In 2006, Mr. Rochlani (the…
This post is a primer on the federal income tax effects of adding a new member to a limited liability company (“LLC”) that goes from a single member limited liability company (“SMLLC”) to a two member LLC. These effects include the conversion of the LLC being treated as a disregarded entity (“DRE”) to a partnership…
Can you help your client obtain a “step-up” in a stock purchase? As a tax adviser, you may have been confronted with the following scenario: your client (P) is buying 100% of the stock of a corporation (T) from seller (S), but the purchase price far exceeds T’s basis in its assets. Since P…
