Challenge IRS Fee Waiver Rules

In July 2015, the U.S. Department of the Treasury issued proposed regulations (REG-115452-14) pursuant to IRC 707(a)(2) addressing the tax treatment of certain private equity management fee waivers. Under the proposed regulations, the conversion of a management fee to a capital contribution without any “significant entrepreneurial risk” may be a “disguised payments for services.” Such…

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Donald Trump’s Billion Dollar Loss: Good Tax Planning, or Dubious Trick?

Donald Trump’s tax returns have led to intense interest in and speculation concerning his tax positions. Recently, the New York Times[1] reported that he had nearly a billion dollars of net operating loss on his 1995 tax returns, available for carryover for many years. Tax commentators have speculated about the loss and the corresponding “cancellation…

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Nevada Enacts New “Commerce Tax” Into Law

Effective on July 1, 2015, Nevada S.B. 483 imposes an annual commerce tax on business entities engaged in business in Nevada, whose ‘Nevada gross revenue’ in a taxable year exceeds $4,000,000.[1] For this purpose, the tax year is a static twelve-month period running from July 1 through June 30 of the following year, regardless of…

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Business Structure of Marijuana Business

Harborside Health Center, one of the nation’s biggest cannabis dispensaries located in Oakland, CA, is challenging the IRS’s efforts to collect a $2.4 million tax bill resulting from an audit of its returns from 2008 and 2009. The IRS claims that Harborside was not allowed to take business deductions under Section 280E of the Internal…

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