Partnership Profits Interest Taxation

Potential Taxation on Grant of a Partnership Profits Interest for Services Rendered: Part II Introduction Part I of the article explained why a grant of a partnership interest for services only entitling the recipient to a portion of future partnership cash flow can result in an immediate taxable event to that service partner. More specifically,…

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Consolidated Appropriations Act 2016 Could Effect You

The recently enacted 2016 Consolidated Appropriations Act, Pub. L. No. 114-113, extends, modifies, and/or adds numerous business-related provisions that affect business of all sizes. Below is just a few of the many changes. Depreciation, and Other Provisions Extended and/or Modified • Increased expensing limitations and treatment of certain real property as § 179 property -The…

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Potential Partnership Taxation Scenario

Potential Taxation on Grant of a Partnership Profits Interest for Services Rendered Overview Under general principles of income taxation the receipt of cash or property in exchange for the provision of services produces taxable income to the service provider. If the service provider receives property (tangible or intangible) in return for services the provider general…

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Proposed Regulations – Disguised Payments

New Proposed Regulations Concerning Disguised Payments to Partners for Services: Part II (Targeted Capital Accounts) Background Our August 6th article, “Proposed Regulations Concerning Disguised Payments to Partners”, described the new proposed regulations that treat certain payments to service partners as compensatory payments rather than as partnership distributions.  The proposed regulations particularly focus on the amount…

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Regulations Concerning Disguised Payments To Partners

New Proposed Regulations Concerning Disguised Payments to Partners for Services Background A partner can act in more than one capacity with respect to its partnership, that of a partner or that of a third-party.  For example, if a partner contributes property to the partnership in exchange for an increased ownership interest the transfer represents a…

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Construction Deductions and Taxes

Previously, we discussed the tax impact of construction allowances on tenants and landlords, including the application of Revenue Code (“IRC”) §110. IRC §110 treatment is not “elective.” However, the regulations add an important additional requirement interpreting the statute’s broad statement that the portion of the construction allowance subject to IRC §110 is that intended for…

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Tax Advantages: Build Yourself Or Let Tenant?

Tenant and Leasehold Improvements: The Tax Impact of Construction Allowances from the Landlord’s Perspective A landlord leasing commercial space can either directly improve or finish-out the tenant’s space or provide the tenant with a construction allowance so that it can arrange for its own finish-out. One can correctly observe that there is no real substantial…

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Partnership and LLC Tax Allocation

April 15th was the deadline for federal and most state income tax returns! Note that Texas annual franchise tax reports are due May 15, 2015. Taxpayers can file the Texas franchise tax report or request an extension of time to file electronically using the WebFile system, which makes it easy to request extensions, submit tax…

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New Summer Office Hours

Dear Clients: We wanted to let you know that our office will be closed this Friday, April 17th. We will be back in the office on Monday, April 20th. We will also start our shorter work week on Monday, April 20th. That is, we will be working one extra hour each day, Monday – Thursday,…

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Applying TPRs and Form 3115

In my last newsletter/blog, I wrote that in connection with the preparation of our clients’ 2014 tax returns, we will do an analysis of, and have discussions about, applying the TPRs to 2014, which may lead us to discussions about filing the Forms 3115 for certain entities if we think there may be some additional…

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