Tax Law Defined® Blog

Showing 5 posts by Nelson D. Rodes.

New Regulations Provide Clarity About “Specified Service Trade or Business” Categories Under Section 199A

Under IRC § 199A, some businesses that are not C corporations can claim an income tax deduction equal to 20% of their combined qualified business income, subject to certain adjustments and limitations. Read More ›

2019 Update – How to Deal with Section 1061's Three Year Holding Period Requirement for Carried Interests

Uncover the Tax Benefits of Section 1061

Hedge fund, private equity and real estate professionals value the carried interest because it allows them to be compensated for their services at long-term capital gains rates. In a prior article, we discussed the impact of the new IRC § 1061 and provided a summary of its rules. This article provides an update on the status of IRC § 1061 and discusses methods for avoiding its application. Read More ›

A Roadmap for Obtaining (and not Losing) the Benefits of Section 1202 Stock

Planning Ideas for Avoiding IRC § 1061's Three-Year Holding Period Requirement

IRC § 1202 has been around for years, but has not received a lot of attention. This inattention has resulted in large part from IRC § 1202's complicated qualification rules, not to mention the planning uncertainties associated with a required five-year holding period. Read More ›

Planning Ideas for Avoiding IRC § 1061's Three-Year Holding Period Requirement

Planning Ideas for Avoiding IRC § 1061's Three-Year Holding Period Requirement

Investment fund managers value compensation in the form of carried interests, which allows them to be compensated for services with income that qualifies for long-term capital gains tax treatment. Numerous efforts have been made during the past decade to cut back or eliminate the favorable tax treatment of carried interests. Read More ›

Horse Owners’ Ability to Utilize a Section 179 Deduction Against Income from Multiple Active Trades or Businesses

Horse Owners’ Ability to Utilize a Section 179 Deduction Against Income from Multiple Active Trades or Businesses Edit

While the Internal Revenue Code allows taxpayers to deduct from taxable income all ordinary and necessary expenses incurred in carrying out an active trade or business, generally, when purchasing tangible business assets with a useful life greater than a taxable year, the asset must be capitalized rather than deducted from business income for the year the property is placed in service. Read More ›

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