IRS - The S Corporation Association

The Legal Case for Pass-Through SALT Parity

Last week, Bloomberg published a report that got our attention. Entitled, “IRS May Knock down New York, Connecticut SALT Workarounds,” the article says the IRS is “likely” to issue regulations that invalidate SALT workarounds.

The reference to New York didn’t surprise us. It’s no secret the IRS is targeting the charitable workaround adopted by New York and other states – they already issued guidance last fall throwing sand in the gears of that one. But the pass-through SALT parity bills passed by Connecticut and Wisconsin are entirely different, both legally and politically.

Why can C corporations deduct all …

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admin2019-03-14T16:58:06+00:00March 14, 2019|

199A Pass-Through Deduction Rules Finalized

Treasury issued the final rules on 199A earlier this month. You can read the rules and accompanying guidance here:

You can also read a terrific “how does it all work” review published in Forbes the other day. As the writer notes:

I believe in giving credit where credit is due, and …

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admin2021-08-16T14:02:03+00:00January 30, 2019|

S-CORP Testifies at IRS

Last month’s elections so dramatically changed the outlook for tax policy in 2017 that we’re still trying to catch up. The outlook for the proposed 2704 regulations in particular has done an about-face, going from appearing almost inevitable to having the Chairman of the Ways and Means Committee, along with others, targeting them for elimination quickly next year.

But they are not dead yet, and the regulatory process moves on. Today, the IRS hosted its public hearing on the proposed rules, and the family business community arrived in force—S-CORP in particular. We submitted our formal comments back on October 17th, …

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admin2019-02-01T19:49:54+00:00December 1, 2016|

S-Corp Submits Valuation Comments

Yesterday, the S Corporation Association submitted its formal comments to the IRS on the pending Section 2704 valuation rules. You can read all 15 pages of comments here, but the basic message of the submission was that Treasury should discard this effort and start over. As the comments conclude:

Promulgation of the Proposed Regulations in their current form and scope will generate significant uncertainty and constitute a significant impediment for the continuity of family-controlled businesses. The Proposed Regulations inappropriately and illegally discriminate against family controlled businesses in form and effect. If Treasury is inclined to promulgate regulations to address perceived …

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admin2019-02-01T19:49:54+00:00October 18, 2016|

Business Community Responds to Valuation Rules

Business Valuation Wire reports there has been a sharp spike in the number of families asking valuation professionals to analyze what the newly proposed rules out of Treasury mean to their business succession plans:

Valuation practitioners tell BVWire they are already seeing an increase in valuation engagements triggered by the proposed Section 2704 regulations. And they expect this to gain steam as the regs continue to sink in with attorneys, wealth planners, and clients.

This should not come as a surprise. The proposed rules target family businesses for higher estate and gift taxes, simply for being family-owned businesses. They accomplish this …

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admin2019-02-01T19:49:55+00:00September 16, 2016|