Taxing Thoughts

From international tax legislation to M&A deals; our Taxing Thoughts blogs cover hot topics and trends in the continuously changing tax landscape.

    A Tax Sandwich – Not Tasty At All

    When a foreign investor becomes a U.S. tax resident, one easily overlooked U.S. tax issue is that such residence change may result in an adverse U.S. tax structure, sometimes referred to as a “Sandwich Structure.” What is a Sandwich Structure? Let’s use an example to explain what a Sandwich [...]

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      How a Tax Consultant Can Save a Business Money

      Clients of any industry, who do not have a state and local tax specialist, often rely on a tax consultant to resolve issues. A tax consultant’s priorities include not only compliance but extend to saving the company money where they can. While businesses may prepare their tax returns themselves or [...]

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        Tax Law Forces Revamps for Agriculture Companies

        The 2017 Tax Cuts and Jobs Act has introduced section 199A, which generally provides special tax deductions to taxpayers doing business as pass-through entities. While an in-depth analysis of section 199A is beyond the scope of this article, section 199A generally allows a special deduction on 20% [...]

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          Tax Insights for Private Equity Investors

          This article explores an intricacy between certain private equity investments and various tax rules deferring the recognition of losses flowing up from partnerships. This article is not meant to be an exhaustive analysis of private equity structuring or the loss limitation rules. Rather, it is to [...]

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            Top 5 California Tax Planning Opportunities

            Weather aside, a rapidly growing economy and profitable marketplace has named California one of the most desirable states for new and expanding businesses and individual taxpayers.  One major obstacle that taxpayers face when seeking to enter into, or expand in California, is state taxes. [...]

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              Avoiding PFIC Status – Practical Considerations

              Overview: One area where complexities of U.S. taxation is clearly demonstrated is the Passive Foreign Investment Company (“PFIC”) rules.  These PFIC rules generally apply to U.S. investors in a foreign corporation where U.S. ownership is 50% or less.  A PFIC is any foreign corporation if – 75 [...]

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                Nexus: The New Era of State Taxation

                The physical presence nexus standard is becoming a thing of the past as state governments try to shift the tax burden from in-state to out-of-state taxpayers. If a state has jurisdiction to tax either the business entity or the subject matter, then a taxpayer has nexus in a state with or without [...]

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                  Tax Cuts Are in the Air

                  By Liubou Partnaya (Tax Senior Associate, Green Hasson Janks) With Donald Trump as President-elect, proposals presented during his campaign are brought to the forefront. Among his proposals are sweeping changes to our income tax laws. Here is a quick overview of individual and business tax reform [...]

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                    The IRS’s International Focus

                    By: Jason Booth For years now an ongoing debate has taken place on Capitol Hill about U.S. international tax policy reform. member at 35 percent) as well as improving our worldwide tax system’s “competitiveness” (compared to nearly all other OECD members’ territorial tax system). However, the [...]

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                      Tax Issues Arising From “Bargain” M&A Deals

                      In a transaction consummated by parties who are unrelated and on an equal footing, one often assumes that the terms of the transaction should represent the fair market value of the property being exchanged. Even the tax law appears to follow the same assumption that “” After all, the fair market [...]

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                        New Rules to Curb Corporate Inversions

                        Over the past two years, a number of high profiled transactions involved U.S. domiciled multi-national companies acquiring a foreign-based company resulting in the U.S.-based acquirer changing its domicile to the country of the foreign company that it had acquired.  This is broadly referred to as [...]

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                          F.I.C.A. Refunds From Severance Payments

                          Our Tax Alert of Jan. 8, 2014 discussed potential refund claims to recover F.I.C.A taxes paid on severance payments made to former employees. The United States Supreme court issued a unanimous opinion on March 24, 2014 in which it determined that payments to laid off workers are subject to both [...]

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                            Credit Where No Credit Was Due

                            The Treasury Department's inspector general for tax administration has estimated that the Internal Revenue Service issued between $11.6 billion and $13.6 billion in improper payments through its Earned Income Tax Credit (EITC) program for the fiscal year ended 2012. The EITC is a welfare program [...]

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                              Proposed Tax Changes from the “Green Book”

                              The United States Treasury recently released the so-called "Green Book," which is the Administration's Fiscal Year 2014 Revenue Proposals. The Green Book is the President's wish-list of tax changes, and as usual, this year's wish-list is a cornucopia of tax proposals - past and present. The [...]

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                                At the Cliff’s Edge

                                Does tax policy change the way in which people behave economically? Could higher tax rates generate lower revenue to the government?   This has been an age old tug of war amongst economists since the Kennedy administration proposed tax cuts in 1962, and the ushering in of the so called "Laffer [...]

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                                  The Looming Cliff

                                  The newest idiom in the American political lexicon is the "fiscal cliff.” It is all but certain to become a catch-phrase for the next fiscal iceberg facing the supertanker known as the U.S. economy. The fiscal cliff refers to approximately $1.2 trillion in automatic spending cuts coupled with [...]

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                                    Benefits and Burdens of U.S. Citizenship

                                    The name of Eduardo Saverin recently appeared on the Federal Register list of U.S. citizens who have renounced their U.S. citizenship. Saverin who was born in Brazil and currently resides in Singapore is best known as a Facebook co-founder and a soon-to-be billionaire. The motivation for [...]

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                                      The Big Apple

                                      On Monday, Apple announced that it is planning to pay a significant dividend to its shareholders for the first time since 1995. The dividend plan is being maneuvered through a maze of U.S. tax issues having to do with repatriating off-shore income. According to its latest regulatory filing, Apple [...]

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                                        The IRS “Dirty Dozen”

                                        On February 16, the IRS published its list of top 12 “tax scams” for 2012 dubbed the “Dirty Dozen.” “Taxpayers should be careful and avoid falling into a trap with the Dirty Dozen,” said IRS Commissioner Doug Shulman. “Scam artists will tempt people in-person, on-line and by e-mail with misleading [...]

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                                          Tax proposals in the fiscal 2013 budget

                                          On Monday February 13, 2012, the Administration submitted its fiscal 2013 budget proposal to Congress. The budget proposal contains changes to spending and deficit projections. As is true with all budget proposals, it includes an outline of future tax proposals by the administration. Here are some [...]

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                                            Administration’s Corporate Tax Reform Proposals

                                            The White House followed up the State of the Union address by releasing a fact sheet named “Blueprint for an America Built to Last” which highlights the administration's proposals for corporate tax reform and support for domestic manufacturing. The corporate tax reform is structured as a framework [...]

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                                              A Worldwide Study on Tax Compliance

                                              Paying Taxes 2012, an annual study by the World Bank, International Finance Corp. and PricewaterhouseCoopers, ranks 183 countries based on difficulty of compliance with business taxes. The study measures the tax systems by viewing a domestic company complying with the different tax laws in each [...]

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                                                IRS Commissioner Lobbying for a Simpler Tax Code

                                                In a recent speech at Harvard’s Kennedy School of Government, IRS commissioner Doug Shulman tried to make the case for tax simplification. In his prepared remarks he said “Most taxpayers want simplicity. They want to pay what they owe, understand what tax benefits they are entitled to, and not get [...]

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                                                  Where there is smoke…

                                                  Buried in the Tax Relief Act of 2010 was a provision that increased the lifetime gift tax exemption from $1 million to $5 million for each individual ($10 million for a married couple). This increase in exemption was provided for a period of two years and is slated to sunset on December 31, [...]

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