The proposed new Treasury regulations under IRC Section 2704 are important not only for estate planners but also for LLC lawyers concerned about asset valuation issues. See new blog post under the following link:
Every operating agreement for a multi-member LLC taxable as a partnership should contain comprehensive partnership audit provisions under TEFRA and under the Bipartisan Budget Act of 2015. Once reason that, as of January 1, 2018, BBA will replace TEFRA for most such LLCs is the unending tax litigation that TEFRA has inspired over the past 34 years. A very recent example of this litigation is the case discussed under the link below.
Under the link below is a useful new post about the new Treasury Department temporary regulations under the new Bipartisan Budget Act of 2015 partnership audit rules.
As many of you will know, Congress in November 2015, enacted, in the Bipartisan Budget Act of 2015, major and draconian new partnership audit rules. Congress painted with a broad and messy brush, and there are dozens of issues as to the meaning and implementation of these rules. All of these issues must be resolved, if at all, by Treasury regulations. Yesterday, the IRS announced that Treasury is aiming to issue these regulations by the end of this calendar year.
Over time, one or more of our LLC clients may go bankrupt. If they do, can a bank provide in the LLC’s operating agreement that the LLC may not file for bankruptcy except with the bank’s consent? According to the very recent decision of the Delaware bankruptcy court, discussed in the post under the link below, the answer is no.
Profits interests can be a highly useful way of attracting and reward LLC employees, independent contractors and investors, but they can involve federal tax pitfalls. The post under the link below summarizes new IRS regs that address whether “employees” of multi-member LLCs taxable as partnerships will be treated for federal tax purposes as partners if the LLC grants them profits interests.
The new Bipartisan Budget Act partnership audit rules are a major development in LLC tax and will affect every existing and new partnership agreement for general and limited partnerships and operating agreement for multi-member LLCs taxable as partnerships. The Treasury Department has just issued a new temporary reg and a proposed reg re early elections under these regs. See T.D. 97800 and REG-105005-16. Every LLC lawyer should have at least a basic understanding of these regulations.
Every LLC lawyer should have, at the very least, a solid basic understanding of the TEFRA partnership audit rules, which will apply until the end of 2017; the new Bipartisan Budget Act rules, which will apply thereafter; and how to deal with these rules in the operating agreements of multi-member LLCs taxable as partnerships. Below is a link to a very practical new blog post by Lou Vlahos about the new regs.
I’ve just stumbled across the blog post under the link below. The post was published in September 2015. I have not posted about this post previously, and I generally post only about current developments. However, I’m covering it in this post because it’s significant for at least a significant number of LLCs. It addresses the issue of who, for federal tax purposes, may sign the federal tax return of an LLC managed by another LLC.