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MULTI-STATE TAX ISSUES

The three excellent new posts from Tax Analysts under the links below address Alabama LLC multi-state tax issues, but the discussions also apply to other states:

  1. http://www.taxnotes.com/state-tax-today/partnerships-and-other-passthrough-entities/alabama-tax-tribunal-llc-must-file-return-distributions-nonresident-members/2015/08/14/15099796
  2. http://www.taxnotes.com/state-tax-today/limited-liability-companies/alabama-tax-tribunal-disregarded-entity-llc-required-pay-business-privilege-tax/2015/08/14/15099926
  3. http://www.taxnotes.com/state-tax-today/limited-liability-companies/alabama-tax-tribunal-finds-single-member-llc-subject-business-privilege-tax/2015/08/14/15099866
  4. http://www.taxnotes.com/imp/15099866
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CONVERSION FROM SUBCHAPTER C TO SUBCHAPTER S

It’s not unheard of for an LLC to elect to be taxable as a C corporation but then to want to convert to a S corporation.  The new post under the link below discusses the conversion:

http://www.taxlawforchb.com/2015/08/c-corp-to-s-corp-it-pays-to-be-the-last-in-and-first-out/?utm_source=Tax+Law+for+the+Closely-Held+Business&utm_medium=email&utm_campaign=92c17b8100-RSS_EMAIL_CAMPAIGN&utm_term=0_4d5d267118-92c17b8100-73367009

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NY TIMES ARTICLE ABOUT IRS HOSTILITY TO FAMILY LIMITED PARTNERSHIPS

If you’re interested in the law and taxation of family limited partnerships, you may find this article interesting:

http://www.nytimes.com/2015/08/08/your-money/navigating-tougher-irs-rules-for-family-partnerships.html?_r=1

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NON-GRANTOR TRUSTS-CHART OF STATE TAXES

A colleague sent me this chart.  It’s not directly relevant to LLC practice, but it may be of interest for other reasons to the readers of this blog.

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PARTNERSHIP TAX DEVELOPMENT

For those of you who are partnership tax wonks, the post sent today by Tax Analysts (the world’s best source of federal tax information, in my opinion) under the link below will be of great interest.  For the rest of us:  “Not so much.”

Here’s the link:  http://www.taxnotes.com/tax-notes-today/14969946

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DEFERRED COMPENSATION

The new FarrelFritz blog post under the link below on the subject of deferred incentive compensation won’t be useful to LLCs taxable as sole proprietorships or partnerships, but it may be very useful to those taxable as S or C corporations.

Here’s the link:

http://www.taxlawforchb.com/2015/07/deferred-incentive-compensation-first-times-the-charm/?utm_source=Tax+Law+for+the+Closely-Held+Business&utm_campaign=2a5cb3c836-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_4d5d267118-2a5cb3c836-73367009.

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NH TAXES

For those of you who follow New Hampshire tax developments, here is an excellent current overview by Tax Notes concerning current negotiations between New Hampshire’s governor and the New Hampshire Legislature concerning New Hampshire business taxation as applicable to LLCs and other entities.

http://www.taxnotes.com/state-tax-today/budgets/new-hampshire-governors-budget-compromise-includes-corporate-tax-breaks/2015/07/24/14943551

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DISCOUNTS

Under the link below is a brief but interesting current blog post about the history of discounts and about current alleged threats to their continued validity.  The first post in the blog is the relevant one, but you may also find that the older posts are also of interest to you.

Here’s the link:

http://www.taxlawforchb.com/?utm_source=Tax+Law+for+the+Closely-Held+Business&utm_campaign=20869b4beb-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_4d5d267118-20869b4beb-73367009

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ARTICLE RE PROFITS INTERESTS

Here is a cite, which I received from a WestLaw Alert, to a new law journal article on some key issues in structuring the federal tax provisions in the operating agreements of multi-member LLCs taxable as partnerships:

Polyatskiy, STRUCTURING LLC WITH CAPITAL INTEREST, PROFITS INTEREST, NCO, COMPENSATORY OPTION, AND CONVERTIBLE DEBT AND EQUITY, 27 DCBA Brief 32 (July, 2015).

I haven’t been able to find a link to the article, but if I do, I’ll post it.

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RISKS WHERE LLC IS IRA-FUNDED

The blog post under the link below addresses the IRA conflict-of-interest issue when an IRA-funded LLC pays compensation to the IRA owner.   The risk is great and the penalty can be “draconian.”

Here’s the link:

http://www.lexology.com/library/detail.aspx?g=ffe62cb0-7e4d-497e-ba71-2c61af139229&utm_source=Lexology+Daily+Newsfeed&utm_medium=HTML+email+-+Body+-+General+section&utm_campaign=Lexology+subscriber+daily+feed&utm_content=Lexology+Daily+Newsfeed+2015-06-30&utm_term=

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