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Our Holiday

Thanksgiving has been a national holiday in the U.S. since 1870. During most of that period, at least until recently, it has also been a unifying force as immigrants to this country, eager to be assimilated to American society,[i] and recognizing the holiday’s universal message of gratitude,[ii] have adopted the day as their own.[iii]

In 1863, only months after the Battle of Gettysburg and the Siege of Vicksburg, and a few years before Thanksgiving officially became a national holiday, President Lincoln issued the following Proclamation:[iv]

Continue Reading This Thanksgiving, Give Thanks for Taxes . . . or Not
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NY Needs the Revenue

A couple of weeks ago, the Tax Foundation released its latest “State Business Tax Climate Index,”[i] which assesses a state’s tax system and compares it to that of other states. New York seems to be a perennial among the ten lowest-ranked states, at number 49.[ii]

According to another report recently issued by the Foundation, New York experienced the highest net loss of residents as a result of interstate migration as a share of its population.[iii]

Continue Reading N.Y. Sales Tax – Responsible Person Liability
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WTF

It appears that many of the country’s colleges and universities[i] believe they have not already contributed enough to the decline of American education and to the erosion of our society, generally.

These institutions of so-called higher learning are not satisfied with having introduced major studies in subjects that can only be described as laughable, diluted academic standards, misrepresented history, encouraged identity politics, adopted cancel culture, stifled free speech, vilified Judeo-Christian values, and demonized Western civilization.

Continue Reading Activities Contrary to Public Policy – Revoking the Tax Exempt Status of Universities
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It’s not enough for the founder of a closely held business to have successfully established the business. The business has to grow, not only to increase profits, but also to make it more competitive and to diversify its customer base. Such “smart” growth will attract talented employees to the business, facilitate borrowing, prepare the business to withstand economic downturns, and make it more attractive to potential buyers.

Continue Reading Disclaiming to Save Taxes
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Tax the Rich

For many weeks, we’ve been hearing about the IRS’s plans to use the funding provided under the Inflation Reduction Act[i] to increase and expand its compliance and enforcement efforts with respect to the wealthy, high-income earners, partnerships, and large corporations.

According to the IRS, not only will the agency add a significant number of new employees, especially examiners, it will also introduce the use of new technologies, including artificial intelligence, to identify persons who may be skirting their tax obligations.

Continue Reading Hospitals and Community Benefit: Senators See a Shortfall
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Uncertain Future

The Congressional Budget Office (“CBO”) recently released some data for the federal government’s 2023 fiscal year. According to the CBO, the federal budget deficit for the year was $1.7 trillion, or 28-percent larger than it was in 2022.[i]

The CBOs’ report attributed the increase to a combination of lower revenues and higher outlays. Can you guess which expenditure was among those most responsible for the increase? If you said payments of interest on the federal debt, you were right.

Continue Reading Debtor Corp’s S Election: “Property” in Bankruptcy?
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Last Week

Many of you, perhaps most, may have read about a case that will be heard by the U.S. Supreme Court during its current term.[i] The case, Moore v. United States, comes out of the Ninth Circuit Court of Appeals.[ii] The Supreme Court recognized the national significance of the case and granted cert in March of this year.[iii] Within less than two weeks of the taxpayer’s having filed its brief with the Court,[iv] about 25 amicus briefs were filed in support.[v]

Continue Reading Supreme Court to Decide: No Realization Means No Moore Income Tax?
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Ups and Downs

It’s wonderful to be part of a successful business, especially in a strong economy. The owners are probably enjoying a more than just decent return on their investment and, in most cases, are getting along well enough. The business’s employees feel secure in their position; hopefully, they also feel valued.

This rosy picture can change rather quickly, however, when the overall economy, or the industry in which the business operates, experiences a downturn.[i]

Continue Reading The Trust Fund Penalty – Times May be Tough, But Don’t “Borrow” from Withheld Taxes
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Another Mess

Congress has only a few days to avert a “shutdown” of the federal government.[i]

It’s not looking good in the House, as Speaker McCarthy has struggled to bring certain members of the majority into line, while more moderate members of his party have displayed a willingness to reach across the aisle to secure a temporary funding bill.[ii]

Meanwhile, it seems that the members of the minority[iii] have been content to watch the GOP’s drama unfold.

Continue Reading Open Transaction Treatment for The Liquidation of a Partner’s Interest
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Toll the Bells

Since 1995 to the present, the LLC has emerged as the entity of choice for the vast majority of entrepreneurs. This form of business entity owes its success to the flexibility and to the tax benefits that it affords its members.[i]

For example, there are no restrictions on (i) the ownership of equity in an LLC, (ii) the number of members it may have, and (iii) the varying classes of economic interests it may issue its members and its ability to specially allocate items of income, gain, loss and deduction.[ii] In addition, the LLC is treated as a pass-through for federal income tax purposes; it does not pay an entity-level tax on its taxable income – instead, such income is reported by and taxed to its members.[iii]

Continue Reading ESBTs and the Carryover of S Corporation Losses