CPA Articles
June 24, 2008
Rosanna DiFilippo - MFA - Moody, Famiglietti & Andronico Over the course of two decades, online sales went from fad to fortune to bust, and have now settled in as part of everyday business for a wide variety of small to medium sized companies. In fact, if you’re selling something then you most likely have an online component – and if you don’t, you’re thinking about it. The wide net that can be cast brings in more buyers from more places, giving sellers the ability to leapfrog to a new level of success. But just as online sales yield higher income for companies, the states in which they do business expect to be compensated through both sales and income tax. Full Story
June 24, 2008
Grant Thornton LLP Where a partnership is owned entirely by a husband and wife who file ajoint return, there has been the question of whether a Form 1065 for thepartnership is necessary. In the Small Business and Work Opportunity TaxAct of 2007, signed into law in May 2007, Congress added section 761(f) toaddress joint ventures between spouses who file joint returns, effectivefor years beginning after Dec. 31, 2006. Full Story
June 18, 2008
Baker Donelson Like-kind exchanges allow an investor to swap property and defer the
capital gains tax. Section 1031 of the Internal Revenue Code allows an
investor to defer taxable gains on the sale of certain types of investment
property if the investor exchanges that investment property for similar or
like-kind investment property. Real property can be exchanged as like-kind
property. One type of real property may be exchanged for another. So long
as the real property is investment property only, the type of real
property swapped does not matter. A warehouse/distribution property may be
swapped for a shopping center or vacant land may be swapped for an office
building. Interests, however, in business entities, such as a partnership
interest, shares of a corporation or membership interests in an LLC do not
qualify for §1031 tax-deferred exchange treatment, even if those
business entities manage or hold investment real property.1 Full Story
June 12, 2008
Joseph Rieser Jr. and Melanie L. Bartlett Jr. - Arent Fox LLP The Internal Revenue Service has updated and revised its Form 990, theannual information return required to be filed by tax-exemptorganizations. The redesigned Form 990 reorganizes many of the elements ofthe old form, so tax-exempt organizations will have to orient themselveswith the new layout. More importantly, the IRS has greatly increased thenumber of schedules to Form 990. The purpose of the new and expandedschedules is to gather increased amounts of information and allow thepublic to view the collected data. Full Story
May 28, 2008
James Masella - Blank Rome LLP On January 15, 2008, the U.S. Supreme Court issued a much-anticipated
decision that significantly reduces the risk that a third party –
such as a vendor or financial institution – that does business with
an issuer who files financial statements that violate the federal
securities laws, would itself be held liable for violations of Section
10(b) of the Securities and Exchange Act of 1934, as amended, and
Securities and Exchange Commission Rule 10b-5. This decision should
significantly insulate financial institutions and others who work with
issuers of publicly traded securities from federal securities law
liability based on a claim that, but for the conduct of the third party,
the issuer would not have been able to make an actionable misstatement. Full Story
May 28, 2008
Morgan, Lewis & Bockius LLP IRS Issues First Private Letter Ruling on Section 409(p) of the
CodeOn January 25, 2008, the IRS published the first
ruling on the S corporation ESOP antiabuse rules codified in Section
409(p) of the code since the rules became law in 2001. Because the rules
were complicated and left many questions unanswered, in 2003 the Treasury
Department issued temporary and proposed regulations to provide guidance
on the application of the provisions of Section 409(p) of the code. On
December 17, 2004, a new set of temporary and proposed regulations were
issued toclarify, expand and modify the 2003 regulations; these
regulations were ultimately finalized in December 2006. Despite these
actions by the Treasury Department, it has taken the IRS more than seven
years to first interpret these complicated and draconian rules. Full Story
May 19, 2008
Wayne Strasbaugh - Ballard Spahr Andrews & Ingersoll, LLP Several years ago promoters devised a strategy to help corporations avoid
large potential tax bills that would otherwise be due upon a sale of their
business. The strategy was a so-called intermediary transaction. An
intermediary corporation with unused tax benefits, such as net operating
loss carryforwards, would acquire the stock of the corporation with the
potential tax bill and then immediately sell off its appreciated assets to
the real purchaser, using the intermediary's tax benefits to shelter the
tax that would otherwise be due. Full Story
May 14, 2008
Scott Saunders As vacant land becomes scarce in many parts of the United States and as states and municipalities have acted to restrict and regulate new construction, the value of development rights has skyrocketed. As used in this article, “development rights” means unused rights to develop a property to the extent permitted under state or local law. Full Story