Crossing the Streams[i]
It is not uncommon, in the context of a business entity in which a family owns a controlling or substantial interest, for an adviser to encounter intersecting gift and income tax issues.
This week’s post will consider one such instance in which the IRS was asked to determine the tax consequences of certain transfers of stock by an individual shareholder of the issuing corporation and by the trusts created for the benefit of the shareholder’s family.[ii]
Before describing these transactions, it may be helpful to briefly review some of the applicable tax principles.Continue Reading Transfers Within the Family Business: Gifts or “Ordinary Course” Transactions?