Income Tax

Independence & Taxes

Last week the United States celebrated the 249th anniversary of its declaration of independence from Great Britain.[i] In celebration of the occasion, President Trump signed into law the One Big Beautiful Act which, among other things, extended the tax cuts enacted during the first year of his first term in the White House.[ii]

As most of us are aware, the debates preceding the enactment of this legislation – whether they occurred in a House or Senate committee, on the floor of either Chamber, in public assemblies, with members of the media, or on city streets – often devolved into what may fairly be described as exercises in divining economic collapse, promoting class warfare, accusing others of demagoguery, etc.[iii]Continue Reading Taxes: An American Obsession?

An Agency Under Siege

The mission statement of the IRS reminds taxpayers that it is their responsibility to understand and meet their tax obligations, while it is the role of the IRS to “enforce the [tax] law with integrity and fairness to all” to ensure that those obligations are satisfied.

The IRA

In 2023, following the $80 billion of funding authorized for the agency by the Inflation Reduction Act (the “IRA”),[i] the IRS announced it was going to increase its enforcement efforts with regard to wealthy and high-earning taxpayers, and the complex partnerships they employ,[ii] to ensure these taxpayers were held accountable for the full amount of taxes they owed.Continue Reading The Limited Partner Exclusion From Self-Employment Tax – But Who Is A Limited Partner?

Two Camps

Last month, Bloomberg carried an article about a “small but growing trend” of states that are either cutting their individual income taxes or phasing them out entirely.[i]

According to the article, the states adopting these measures have determined that, by reducing income taxes, they will enhance their ability to attract and retain people and businesses.[ii]Continue Reading State Taxation of a Nonresident’s Gain from the Sale of Stock –The Shot Heard Round the Country?

Back to the Office

You are probably aware that many employers are discarding the fully flexible, remote work policies that were forced upon them – as “nonessential” businesses – during the COVID-19 pandemic[i] and which they retained as an accommodation to employees after the pandemic ended. Indeed, there is now a steadily increasing percentage of employers that are requiring their employees to return to the office or place of business.

Some employers are mandating that employees work in the office full-time.[ii] Many other businesses expect employees to be physically present at least three days per week.[iii] Often, employers are “taking attendance” to ensure compliance with their in-office policies.Continue Reading Employer to Nonresident Employee: “You Cannot Work in New York”; New York to Employee: “We Will Tax You Anyway”

August is Like Sunday

As far back as I can remember, the end of August has always elicited a sense of dread comparable to what many schoolchildren, and a fair number of adults, experience every Sunday afternoon.

In retrospect, I cannot say that this feeling of doom was ever fully warranted.[i] Still, its presence has been undeniable, and it is especially palpable this year, and for good reason.  Continue Reading New York’s Tax Treatment of Compensatory Restricted Stock and Dividends in the Hands of a Nonresident Executive

Bon Voyage?

Over the last couple of years, several of my friends have become citizens of the country from which their parents emigrated to the U.S.[i]

Also during that period, some acquaintances took advantage of the so-called “golden visa” programs still being offered by a handful of European Union members.[ii]

A few clients gave up their U.S. citizenship, or their status as permanent residents of the U.S. (green card holders), and paid the resulting exit tax.[iii]Continue Reading Swapping Foreign Real Properties On a Tax Deferred Basis

Notice of Deficiency

Over the years, I have observed there is only one thing that a taxpayer fears more than being notified by the IRS that their income tax return for a particular taxable year has been selected for audit, and that is being notified that the IRS has determined the taxpayer owes additional tax,[i] plus interest[ii] and penalties,[iii]  for such year.

A taxpayer who has received a timely[iv] notice of deficiency[v] is generally presented with three basic options:Continue Reading Missing the Tax Court’s 90-Day Deficiency Deadline – Now What?

Tax Season

As we approach the deadline for paying federal individual income taxes and, generally, for filing the returns on which such taxes are determined, some of you may be recalling how the Inflation Reduction Act of 2022 appropriated billions of dollars[i] to the IRS to bolster enforcement of the Code, including hiring more enforcement agents, providing legal support, and investing in “investigative technology.”Continue Reading An Inveterate Golfer At the IRS

What Corporate Shield?

Would you be surprised to learn that most shareholders of closely held corporations, and especially those with minority or merely passive interests, believe they cannot be held responsible for the tax obligations of their corporations?

I, for one, would not. Over the years, I have both experienced and read about many situations in which shareholders realized too late that the “limited liability” protection the corporate shield affords them under a state’s business corporation law goes only so far, even in cases where the corporation is respected as a separate legal entity.[i]Continue Reading Shareholder-Transferee Liability for a Corporation’s Income Tax

Mixing Holidays With Business

Hope you had a good Thanksgiving Holiday. Some of us probably feel we ate or drank either too much or not enough, watched too much or not enough football, or spent too much time discussing politics and the state of the Dis-Union with family or friends. Then there were some who, having overheard in the midst of the merrymaking how someone else had implemented what sounded like a wonderful tax-saving strategy, resolved to do the same themselves for 2024.[i]Continue Reading The Family Business – Compensating Family-Employees