Tax

Accounting And Financial Planning For Law Firms

Determining Law Firm Employee Classification Through the ABC Test

Jonathan Weinberg

Law firms have traditionally been large consumers of contract labor for a variety of purposes. These workers are traditionally classified as independent contractors, issued a 1099 and treated as ineligible for employee benefits. In recent years, many states have started to adopt the “ABC” test to determine whether a worker should be classified as an independent contractor or an employee.

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Entertainment Law & Finance

U.S. Tax Court Considers Whether Net Operating Losses from Film Production Companies Are Deductible

Stan Soocher

Structuring finances for independent film productions isn’t for the faint of heart, especially where there are multiple entities formed in different states involved in the productions; loans involving different entity members; and efforts on tax returns to deduct net operating losses (NOLs).

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Accounting And Financial Planning For Law Firms

The Future of IRS Summonses After Supreme Court ‘Poselli’ Ruling

Jeremy H. Temkin

In Polselli v. Internal Revenue Service, the U.S. Supreme Court unanimously refused to limit the IRS’s ability to issue summonses without notice to situations in which it seeks records of accounts in which a delinquent taxpayer has an interest. This article discusses the court’s decision, Justice Jackson’s concurring opinion, and the potential for future challenges to the IRS’s issuance of summonses without notice.

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Accounting And Financial Planning For Law Firms

Should Law Firms Make Pass-Through Entity Tax Elections?

Jonathan Weinberg

As a result of the TCJA, the owners of pass-through entities are limited in the amount of state and local taxes they can deduct on their Federal income tax return. In response, over 25 states have enacted pass-through entity tax regimes, which allow the owners of law firms to preserve their state and local tax deduction on their income from the law firm.

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The Bankruptcy Strategist

Appellate Court Reverses Chapter 11 Confirmation Order Based on Faulty Tax Ruling

Michael L. Cook

The Northern District of California recently issued two blistering opinions on appeals by the IRS and California Franchise Tax Board from a bankruptcy court’s Chapter 11 plan confirmation order and a tax determination order.

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Entertainment Law & Finance

Tax Issues In Charitable NIL Collectives In College Sports

Todd Kesterson and Alyssa R. Wan

With a growing number of donor groups forming Name Image and Likeness collectives as not-for-profit entities, there are questions about whether or not these collectives truly qualify as charitable organizations for tax purposes.

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Entertainment Law & Finance

Right to Funds from Sale of Tax Credits At Issue In Litigation Between Production Companies

Stan Soocher

State tax credits are valuable tools for helping meet the costs of producing films, TV shows, commercials, and other media and entertainment productions. But if more than one production company is involved with a project, a legal dispute can arise over which company owns the right to the tax credit funds.

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Entertainment Law & Finance

What’s Happening With Productions Tax Credit In GA?

Mason Lawlor

In recent years, the Peach State has become one of the most popular spots for film companies. However, the state General Assembly’s action with regarding one bill and inaction with regard to another have threatened to harm the entertainment industry.

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The Bankruptcy Strategist

Stipulation That Resolves Entire Amount Must Reflect Intent of Parties

Francis J. Lawall and Kenneth A. Listwak

The Ninth Circuit recently affirmed a lower courts’ rulings that a stipulation between the IRS and a bankruptcy trustee, which allowed the IRS’s priority tax claim, did not prevent the IRS from collecting nondischargeable tax debt above the agreed amount in that stipulation.

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Commercial Leasing Law & Strategy

7 Post-Pandemic Commercial Property Tax Tips

Cris K. O’Neall

As post-pandemic market values fluctuate due to higher prices, property owners need to adopt strategies to keep their assessed property values down. As we emerge from COVID-19 here are seven key considerations to minimize property tax assessments even as prices increase.

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Accounting And Financial Planning For Law Firms

Tax Implications of Budget Reconciliation Bill

Lawrence L. Bell

Part Two of a Two-Part Article

This installment discusses how to use benefit laws that have been on the books for over 30 years to fund not only death benefits but also alternatives to deferred compensation for business and estate planning purposes for pass-through entities.

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The Bankruptcy Strategist

Will Supreme Court Settle Sale of Tax Liens Issue?

Kenneth L. Baum

There's a split among circuit courts on whether tax foreclosure sales may be avoidable as preferential and fraudulent transfers by property owners who subsequently seek relief under the Bankruptcy Code. If the Supreme Court eventually weighs in to resolve this circuit split, property owners, municipalities, and potential bidders for tax liens across the country will receive greater clarity on this critical issue.

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Accounting And Financial Planning For Law Firms

Remote Work Yields Savings, But Watch for Tax and Jurisdiction Issues

Troy Ayala

While the rapid ascent of home offices may have initially come as a shock to more than a few corporate cultures, the truth is that business leaders who embrace long-term remote working can yield significant cost savings and boost employee morale.

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Accounting And Financial Planning For Law Firms

Tax Implications of Budget Reconciliation Bill

Lawrence L. Bell

In this two-part article, we look at the proposed tax law changes in the budget reconciliation bill — the major legislation in 2021.

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Accounting And Financial Planning For Law Firms

Build Back Better: Considerations for Tax Advisers & Planners

Lawrence L. Bell

The Infrastructure Investment and Jobs Act, signed by the President on Nov. 15, 2021, presents a number of issues for advisers, planners and taxpayers to consider.

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Accounting And Financial Planning For Law Firms

Biden’s Economic Road Map Includes Benefits for Government Contractors

Lawrence L. Bell

The Biden Administration and the Democratic controlled Congress is rolling out a robust spending plan that will provide benefits and burdens for the defense and government contract community. This article provides a road map that will assist in providing permissibly selective benefits for the qualifying government contractors and employees.

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Commercial Leasing Law & Strategy

Selective Reassessment of Only Commercial Properties Violates the Uniformity Clause

Alan Nochumson and Clementa Amazan

The Commonwealth Court of Pennsylvania recently analyzed whether the City of Philadelphia’s selective reassessment in tax year 2018 of only commercial properties at current market value violated the Uniformity Clause and the Assessment Law’s requirement that the City assess all properties annually at actual market value.

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Accounting And Financial Planning For Law Firms

Registered Nurses In a Top Hat Plan

Lawrence L. Bell

As the healthcare industry is emerging from the pandemic they are looking for ways to reward, retain and recruit a very important segment of its people — Registered Nurses. Employers are looking for ways to provide benefits in an economically efficient fashion that does not create an immediate and punitive tax on the participant.

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Accounting And Financial Planning For Law Firms

Biden Administration Budget 2022: Employer Sponsored Death Benefits a Forgotten Planning Tool

Lawrence L. Bell

Part One of a Two-Part Article

While providing a current benefit for employees, an employer sponsored death benefit is an asset that may create needless taxation if not properly handled. Taking prudent steps will avoid the problems of loss of control and flexibility while minimizing income, estate, transfer and capital income taxes.

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Entertainment Law & Finance

How U.S. Tax Court Reached Its Decision on Michael Jackson’s Right of Publicity

Stan Soocher

The significance of the U.S. Tax Court decision for celebrities and their estates is clear: Prior to now, as Tax Court Judge Mark V. Holmes noted: “We haven’t had a case directly addressing the taxability of the image and likeness.”

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Accounting And Financial Planning For Law Firms

Implications of NJ BAIT for Law Firms

Edward J. Sadowski

NJ Senate Bill 3246 established the “business alternative income tax” (BAIT), an elective business tax regime for pass-through entities. Law firms are left wondering if electing to pay the BAIT is the right choice. This article summarizes how the NJ BAIT works, as well as its pros and cons.

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Commercial Leasing Law & Strategy

Floor Area Bonuses Allowed for Mixed-Used Properties Under the Philadelphia Zoning Code

Alan Nochumson and Clementa Amazan

Part Two In a Series

In this part of the series on “zoning” bonuses in the city of Philadelphia, we explore Floor Area Bonuses provided under the Mixed Incoming Housing, Green Building, and Underground Accessory Parking & Loading Bonuses.

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Business Crimes Bulletin

No ‘Fishing’ In Trump Tax Return Case

Steven A. Cash

“Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime.” Judge Victor Marrero, writing in a decision dismissing the President’s civil suit under the Civil Rights Act, neither gives a fish, nor teaches how to fish — rather he explains what fishing is.

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The Bankruptcy Strategist

Treatment of Straddle Year Federal Taxes in Bankruptcy Cases

Andrew C. Kassner and Joseph N. Argentina Jr.

When does a tax liability claim arise in a bankruptcy case? The issue was recently addressed by the U.S. District Court for the District of Delaware which ruled that federal income taxes for the year in which a debtor files for bankruptcy are entitled to priority treatment as administrative expenses when the end of the taxable year occurred after the bankruptcy petition date.

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New York Real Estate Law Reporter

What Happens to Surplus Funds in Tax Lien Foreclosures?

Stewart E. Sterk

When a sale follows a municipality’s foreclosure on a tax lien, who is entitled to sale proceeds that exceed the amount of the tax lien?

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The Bankruptcy Strategist

Update on Corporate Bankruptcy Tax Refund Litigation

Michael L. Cook

The bankruptcy trustee of a bank holding company was not entitled to a consolidated corporate tax refund when a bank subsidiary had incurred losses generating the refund, Tenth Circuit held.

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New York Real Estate Law Reporter

Challenge to Property Tax Rejected

Stewart E. Sterk

No one disputes that the property tax system in New York City is byzantine. In Tax Equity Now LLC v. City of New York, the First Department confronted what it viewed as a very different question: is it illegal. The court concluded that it is not, rejecting a variety of claims and leaving any reform to the legislature.

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Accounting And Financial Planning For Law Firms

Supreme Court Defers to State Law on Ownership of Tax Refund

Michael L. Cook

Federal courts should “turn to state law to resolve” a “fight over a tax refund,” held a unanimous U.S. Supreme Court in Rodriquez v. FDIC (In re United W Bancorp., Inc.).

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The Bankruptcy Strategist

Supreme Court Defers to State Law on Ownership of Tax Refund

Michael L. Cook

High Court Rejects Application of Bob Roberts Rule

Federal courts should “turn to state law to resolve” a “fight over a tax refund,” held a unanimous U.S. Supreme Court in Rodriquez v. FDIC (In re United W Bancorp., Inc.)

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Commercial Leasing Law & Strategy

Deciphering the Tax Status of Leased Property

Janice G. Inman

Is a property leased to a farming tenant a commercial property or an agricultural property? What about a building leased to a government entity? The distinction can make a difference in the tax laws that apply to the parcel.

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Accounting And Financial Planning For Law Firms

Basic Tax Issues for Social Media Influencers

Robert M. Jason

This article provides a general introduction to social media influencers and discusses common tax issues arising on the income side of the equation. What is taxable income? What happens if the influencer’s compensation is paid in equity?

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Accounting And Financial Planning For Law Firms

IRS Issues New Plan 457(f) Non-Profit Exam Guidelines

Lawrence L. Bell

Planning for executive benefits for top hat employees at non-profit organizations has undergone a frenzy of regulatory roadmap changes. Nonprofit NonQualified Benefits are largely directed and controlled by IRC §457.

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Accounting And Financial Planning For Law Firms

Key Tax and Financial Considerations for New Law Partners

John Fitzgerald and Christopher Imperiale

Being asked to join the partnership of a firm is a measure of success as a legal professional. With that achievement comes tax and financial responsibilities that, surprisingly, few attorneys are fully prepared to deal with. These responsibilities include the unexpected individual federal and state and local tax filing and payments.

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Accounting And Financial Planning For Law Firms

Work Opportunity Tax Credit and On-Boarding

Lawrence L. Bell

With the cost of doing business consistently on the rise combined with the increasing difficulty to find/retain great employees, there is no better time to pursue employment-based tax credits. There are both federal and state employment-based credits available that can help businesses offset income tax liability.

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Accounting And Financial Planning For Law Firms

Athletic Coaches and the Tax Act

Lawrence L. Bell

When the Tax Cut and Jobs Act became law in December of 2017 there was a question whether some of the highest salaried employees at non-profit organizations would be exempt from the $1M remuneration tax. In the majority of states, the highest salaried employees are athletic coaches.

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Accounting And Financial Planning For Law Firms

Valuation Implications of the Tax Cuts and Jobs Act of 2017

Ronald L. Seigneur

This article focuses on the impact of tax reform on C corporations and looks at the significant and complex changes to pass through entities.

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Accounting And Financial Planning For Law Firms

Inside the New Tax Plan’s Changes to Carried Interest

Kelsi Maree Borland

Phil Jelsma, a partner and chair of the tax practice team at a San Diego-based commercial real estate law firm talks about the changes to carried interest, how this will impact commercial real estate investment and what investors should do now to comply.

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Commercial Leasing Law & Strategy

New Development Projects: The Reports of Demise Were Greatly Exaggerated

Michael R. Leighton

Numerous shopping center developers use a “layer-cake” of financing, including state and federal tax incentives to reduce the costs of debt and equity financing. The industry correctly saw that the market value of the credits would drop once the Jobs Act become effective. Such tax cut could undoubtedly impact the ability of developers to raise equity, certainly for new projects not yet placed in service.

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Commercial Leasing Law & Strategy

Opportunity Zones and Commercial Real Estate

Erika Morphy

One of the many provisions of last year’s tax overhaul was the creation of a little-noticed program called Opportunity Zones, which was designed to give investors tax breaks for investments in designated areas. Now, attention is starting to pick up as the program takes shape.

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Business Crimes Bulletin

Swiss Bank Pays for Helping U.S. Clients Evade Taxes

Sue Reisinger

Here’s a sure way to lose half your cooperation credit in a federal investigation: Let your in-house counsel advise employees not to cooperate with U.S. prosecutors.

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Accounting And Financial Planning For Law Firms

Executive Benefits at Non-Profits after the Tax Cuts and Jobs Act

Lawrence L. Bell

The Tax Cuts and Jobs Act made significant changes to certain Internal Revenue Code provisions dealing with highly compensated employees. Among these are restrictions (in the form of excise taxes) on compensation of certain highly paid employees of “applicable tax-exempt organizations.”

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Commercial Leasing Law & Strategy

The Tax Cuts and Jobs Act — How It Affects Real Estate

Peter M. Fass

Part One of a Two-Part Article

The Tax Act is the most sweeping change to the U.S. federal income tax laws since 1986. This and future articles discuss the individual tax and business tax provisions that affect real estate investment and investors in real estate.

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Entertainment Law & Finance

Loan-Out Corporations after Tax Reform and CA Supreme Court Decision in 'Dynamex'

Robert M. Jason

The tax reform bill signed by President Trump at the end of 2017 has caused us to take a fresh look at many long-held assumptions about how to take into account income taxes in planning for the entertainment industry. At the same time, the California Supreme Court recently decided a case that has the potential to eviscerate loan-out corporations entirely. This article discusses loan-out corporations in light of these two important developments.

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Commercial Leasing Law & Strategy

The Tax-Exempt Entity’s Property and a Lessee’s Private Purpose

Janice G. Inman

When a tax-exempt property’s use by a lessee involves an element of private profit. Is the tax-exempt status lost?

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Accounting And Financial Planning For Law Firms

Online Extra: How the Supreme Court's Online Sales Tax Case Could Affect Law Firms

Marcia Coyle

A tax nightmare could face big law firms and other multistate service providers if the U.S. Supreme Court this term requires retailers to collect sales taxes in states where the business has no physical presence.

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Entertainment Law & Finance

New Federal Tax Act Gives New Life, and Twists, to Treatment of Film, TV and Stage Productions

Thomas D. Selz and Bernard C. Topper Jr.

Section 181 of the IRC has provided benefits to both producers of movies and television programs and — under pass-through legal structures such as limited liability companies — to their investors. Now, with the enactment of the sweeping new federal tax law, §181 has been given new life, with a couple of additional benefits and a couple of additional twists.

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Commercial Leasing Law & Strategy

The Basics When Reviewing a Real Estate Tax Provision

Mark Morfopoulos

There are several clauses that rarely find their way into a landlord’s initial draft of the lease that may be beneficial to a tenant. In addition, certain real estate tax provisions that are typically included in a landlord’s standard lease form need to be carefully reviewed to make sure they are fair to both the landlord and the tenant.

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Accounting And Financial Planning For Law Firms

Taxing Questions for Law Firms Looking to Benefit in the New Regime

Meredith Hobbs

The new law offers two obvious potential benefits: a 20% deduction for pass-through entities such as partnerships, and a 21% tax on corporations.

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Accounting And Financial Planning For Law Firms

Impact of the Tax Cuts and Jobs Act on Law Firms

Marcus Dyer

This article describes the provisions of the Act most likely to impact law firms.

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Accounting And Financial Planning For Law Firms

Tax on Excess Tax-Exempt Org. Executive Compensation

Lawrence L. Bell

Under the Tax Cut and Jobs Act, should certain employees of a tax-exempt organization receive compensation greater than $1,000,000 during the tax year from any combination of a tax-exempt organization and/or its related organizations, the organizations would be subject to an excise tax on that employee’s compensation in proportion to their payments to the employee.

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