Category Archives: Tax

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What Employers Need to Know About Healthcare Reform for 2013

As the end of 2012 approaches, we consider what a notable year it has been for the future of healthcare reform, starting with the United States Supreme Court’s decision to uphold key provisions of the Patient Protection and Affordable Care Act (“PPACA”), and culminating with the November elections. Since PPACA’s enactment in 2010, employers have … Continue Reading

FTB issues Notice to Retroactively Deny “Qualified Small Business Stock” Tax Benefits. Amended Returns Should be Filed.

By Matthew Richardson A California appellate court recently held as unconstitutional the California statutes extending the benefits of selling “qualified small business stock” (QSBS) to California taxpayers. In Cutler v. Franchise Tax Board (2012) 208 Cal. App. 4th 1247, the court held that the QSBS exclusion and deferral statutes – California Rev. & Tx. Cd. … Continue Reading

IRS Issues Proposed Regulations To Make International Grant-Making By Private Foundations Easier

On September 24, 2012, the IRS issued Proposed Regulations §§ 53.4942(a)-3 and 53.4945-5 in order to reduce barriers to international grant-making made by private foundations. Secretary of State Hilary Clinton announced the guidance during an address at the Clinton Global Initiative. In particular, the new guidance modernizes the process of evaluating whether a foreign non-governmental … Continue Reading

Further Relief on Section 6045B Reporting

As previously reported in the January 9th blog article, today is the last day to file Form 8937 to report 2011 corporate actions that affect stock basis, as required under Internal Revenue Code section 6045B. Because the actual IRS Form 8937 was only very recently released, and because a number of questions about the form … Continue Reading

Update on New Reporting Rules for Stock Splits, Recapitalizations, Mergers and Acquisitions

As previously reported in the March 15 blog article, Section 6045B of the Internal Revenue Code imposes new reporting requirements on issuers of "specified securities" engaging in organizational actions after December 31, 2010 that affect the tax basis of their specified securities. Generally, a "specified security" includes shares of stock and interests treated as stock … Continue Reading

IRS Launches Voluntary Worker Reclassification Program

On September 21, 2011, the IRS announced (in Announcement 2011-64) a new program that will allow employers to resolve their worker classification problems at a relatively low cost. This new Voluntary Classification Settlement Program (VCSP) is available to businesses that erroneously treat their workers or a class or group of workers as nonemployees or independent … Continue Reading

New IRS Reporting Rules for Stock Splits, Mergers and Acquisitions

Update: The IRS recently came out with a Notice (Notice 2011-18) stating that, for transactions occurring in 2011, penalties will not be imposed against issuers for missing the deadline to file a return or post the tax return on the issuer’s primary public Web site (which generally was required 45 days after the transaction), provided that the return … Continue Reading

IRS Announces Second Special Voluntary Disclosure Initiative for Taxpayers With Undisclosed Offshore Accounts

The Internal Revenue Service announced on February 8, 2011 the creation of a second special voluntary disclosure initiative for U.S. taxpayers with undisclosed foreign bank and other financial accounts. This new program is a follow-on to the IRS’ original voluntary disclosure initiative that closed on October 15, 2009. The 2009 program reportedly attracted some 15,000 voluntary disclosures … Continue Reading

General Counsel and State Tax Notices

General counsel often do not receive notices from tax agencies. These notices generally go to the financial officer’s departments or to whomever handles taxes. Notices from the Internal Revenue Service generally get attention, but notices from state or local agencies often get ignored because the amounts are small or the recipient does not think that the … Continue Reading

Extension of 100% Gain Exclusion for Qualified Small Business Stock

Included in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 signed into law on December 17, 2010, a tax incentive relating to qualified small business stock ("QSBS") was extended for another twelve months.  Pursuant to this extension, noncorporate taxpayers are allowed to exclude all (100%) of their gain from the sale or exchange of  QSBS (subject to  a … Continue Reading

Major Changes to the Federal Transfer Tax System

On December 17, 2010 President Obama signed into law "The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010" (the "2010 Act"). The 2010 Act made major changes to the federal transfer tax system, which includes the estate tax, the gift tax, and the generation-skipping transfer tax (the "GST tax"). These changes will … Continue Reading

Congress Enacts 2010 Small Business Jobs Act

Congress recently enacted the "2010 Small Business Jobs Act," which includes an assortment of tax breaks and incentives for small businesses (as well as a few revenue raisers).  Continue reading for a summary of some of the tax breaks and incentives provided by the act. … Continue Reading

IRS Guidance on Series LLCs

A number of domestic jurisdictions (Delaware, Illinois, Iowa, Nevada, Oklahoma, Tennessee, Texas, Utah and Puerto Rico) have enacted "series LLC" statutes, which provide for the creation of limited liability companies (LLCs) with separate "series."  Although such statutes generally do not treat each series as a separate entity for state law purposes, the association of members with one or more particular series is similar … Continue Reading

Newly Enacted 5-Year NOL Carryback Election To Provide Significant Tax Savings

On November 6, 2009, the "Worker, Homeownership, and Business Assistance Act of 2009" (the "Act") was signed into law. While primarily directed at extending unemployment compensation benefits, the Act provides a significant opportunity for taxpayers that have net operating losses in 2008 and 2009 to trigger tax refunds by carrying those losses up to five years … Continue Reading

California Tax Commission Report

Governor Schwarzenegger established the Commission on the 21st Century Economy (the "Commission") to evaluate and recommend changes to California’s tax system. A report of the Commission’s findings was published in September 2009. Six recommendations were proposed, which, if approved, would take effect in 2012.  … Continue Reading


In United States v. Textron Inc., 2009 WL 2476475 (1st Cir. Aug. 13, 2009), the United States Court of Appeals for the First Circuit held that the attorney work product doctrine only protects documents “prepared for use in possible litigation.” This arguably marks a significant modification of the previous rule in that Circuit and elsewhere that … Continue Reading

City of Los Angeles Tax Penalty Amnesty Program

The City of Los Angeles Office of Finance recently implemented a Tax Penalty Amnesty Program (the "Program") that allows businesses that have not registered with the Office of Finance, or that have unpaid taxes or underreported gross receipts, to avoid a penalty of up to 40% of the tax due for tax periods ending on … Continue Reading

Modifications of home loans under government program will not adversely affect REMICs

The IRS recently issued "safe harbor" guidance that home loans modified under the Home Affordable Modification Program (HAMP) will not adversely affect real estate mortgage investment conduits (REMICs). Without this guidance, payments from the US government to lenders and servicers of home loans under HAMP may have resulted in a 100% penalty tax and may … Continue Reading

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