Showing 11 posts by Scott W. Dolson.
We recently published four articles discussing the potential benefits of holding and selling Qualified Small Business Stock (QSBS) under IRC § 1202 and diving into the complicated qualification rules. Based on the volume of responses to those articles, we felt that a basic checklist of qualification requirements would help business owners and tax professionals considering structuring or restructuring a business to take advantage of IRC § 1202, or trying to confirm whether their stock is QSBS. Read More ›
Shifting the focus from understanding the Tax Cuts and Jobs Act to considering whether what has changed significantly alters the choice of entity landscape. Read More ›
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 ›
During the past decade, private equity investors and other financial buyers (referred to generally in this article as financial buyers) have dramatically increased their activity in the M&A marketplace. These financial buyers generally acquire portfolio companies with the intention of holding them for around five years and then selling them for a substantial profit. Read More ›
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 ›
During the past decade, the White House, Congress and the IRS have threatened on numerous occasions to reduce or eliminate the tax benefits of carried interests ("promotes" in the real estate world). In 2009, legislation was introduced that would have taxed all income from carried interests as ordinary income. Read More ›
Taxpayers who qualify for the IRC § 199A deduction (the "Deduction") will be one of the big winners under the Tax Cuts and Jobs Act (the "2017 Tax Act"). Read More ›
In the aftermath of the 1986 tax act and the introduction of LLCs, pass-through entities (LLC and S corporations) replaced C corporations as the default choice for closely-held businesses. Several changes made by the 2017 Tax Cuts and Jobs Act (the "2017 Tax Act") have put this settled planning issue back into play. The 2017 Tax Act reduced the top corporate tax rate from 35% to 21%, eliminated the corporate alternative minimum tax, and left untouched the C corporation's right to deduct state and local taxes. In prior years, the potential benefits of IRC § 1202 tax treatment for C corporation stock were usually dismissed as being too speculative to move the dial in favor of choosing the C corporation. But in combination with the recent tax law changes, the additional benefits of IRC § 1202 make a strong case for at least taking a close look at organizing a new business through a C corporation. Read More ›
New laws governing IRS partnership audits (the “New Audit Rules”) were enacted during 2015 and are effective for all partnership tax returns filed for partnership tax years beginning January 1, 2018. Read More ›
During the past decade, financial buyers such as private equity firms (PE firms) have dramatically increased their participation in the M&A marketplace. PE firms and other financial buyers generally acquire companies with the intention of holding them for a three to seven-year period and then (hopefully) selling their "portfolio company" for a profit. Most PE firms look for target companies with strong management teams. PE firms also often encourage a target company's equity owners (referred to in this article as "founders") to "roll over" a portion of their equity, so that the founders own a minority equity position in the target company or its holding company after the transaction closes. Read More ›
Ask the Blogger
Do you have a topic that you would like discussed in a future blog article? Please let us know. If you have a confidential question regarding a blog article, please feel free to contact the article's author directly, or let us know if you would like for someone to contact you directly.
Alison M. Stemler is FBT’s Employee Benefits Team leader. She advises on executive compensation and employee benefits plans, including equity-based and deferred compensation arrangements, and assists with compliance issues for retirement and welfare plans and HIPAA.