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Archive for the ‘Federal Taxation’ Category

Plan to Replant – A Future Without Citrus Greening

Published: February 22nd, 2016

By: Dana M. Apfelbaum

We previously reported on the development of genetically modified citrus trees by IFAS that show enhanced resistance to citrus greening, as well as potentially canker and black spot. While many growers have not replanted groves lost to freeze, hurricanes, citrus canker, and citrus greening due to the ever-looming threat of citrus greening, this new development […]

Court Finds Shareholder Liable in Recent Midco Transaction

Published: January 15th, 2016

By: Stephen R. Looney

In Tricarichi,1 the Tax Court held that the sole shareholder of a corporation was liable as a transferee for the corporation’s unpaid tax liability after he sold his stock in a “Midco” transaction, resulting in a tax deficiency of $15,186,570 and penalties of $6,012,777 under Section 6901 and Ohio fraudulent transfer laws. The taxpayer was […]

Some Sunshine for Florida Citrus Growers in the Battle Against Citrus Greening

Published: November 23rd, 2015

By: Michael D. Minton Brad Gould Dana M. Apfelbaum

Earlier today the University of Florida’s Institute of Food and Agricultural Sciences (IFAS) announced that its researchers have developed genetically modified citrus trees that show enhanced resistance to citrus greening. These citrus trees may also have the potential to resist canker and black spot. IFAS noted that the commercial viability of these new citrus trees […]

Tax Court Holds that Sale of Real Property Resulted in Ordinary Income Rather than Capital Gain

Published: August 26th, 2015

By: Stephen R. Looney

In Fargo,[1] the Tax Court held that a couple had ordinary income from a property sale by a partnership in which they were partners because the property was sold in the ordinary course of business.  The taxpayer, husband and wife, were partners in Girard Development, L.P. (GDLP), an entity subject to the partnership procedures under […]

IRS Issues Proposed Regulations Eliminating Requirement That Service Provider File Copy of Section 83(b) Election with Tax Return

Published: August 11th, 2015

By: Stephen R. Looney

On 7/17/2015, the IRS issued proposed regulations regarding the Section 83(b) election.  Under the general rule of Section 83(a), if, in connection with the performance of services, property is transferred to any person other than the person for whom such services are performed, the excess of the fair market value of the property as of […]

Circular Flow of Funds in Back-to-Back Loan Transactions May Give Rise to Basis under Section 1366(d)(1)(B)

Published: April 17th, 2015

By: Stephen R. Looney

At the ABA Tax Section S Corporations meeting held in Houston, Texas, on 1/30/2015, government officials defended their decision not to include in the final Section 1366 and Section 1367 S corporation back-to-back loan regulations an example on loan restructurings involving a circular flow of funds.  The statement was made in a panel presentation at […]

Tax Court Recharacterizes Portion of Bonus Paid to Physician as Nondeductible Dividend

Published: April 7th, 2015

By: Stephen R. Looney

In Midwest Eye Center, S.C.,[1] the Tax Court held that $1 million of a $2 million bonus paid to the physician sole shareholder of a personal service corporation was a non-deductible dividend distribution. Under the facts of the case, the taxpayer, a C corporation, conducted an ophthalmology surgery and care center during the tax years at […]

Eighth Circuit Denies Like-Kind Exchange Treatment to Taxpayer Attempting to Avoid Related Party Rules of Section 1031(f)

Published: March 30th, 2015

By: Stephen R. Looney

In North Central Rental & Leasing, LLC,[1] the Eighth Circuit Court of Appeals determined that the taxpayer, North Central Rental & Leasing, LLC (“North Central”) had improperly claimed non-recognition treatment under Section 1031 with respect to gains from certain property exchanges. Butler Machinery Company (“Butler Machinery”) sold agricultural, mining and construction equipment for manufacturers, primarily […]