Uncategorized - The S Corporation Association

2704 Comment Period Closes Big

The official comment period on the proposed Section 2704 regulations closed yesterday, with nearly 10,000 comments filed! You can review those comments here, but a cursory review this morning made clear they were nearly unanimous in their opposition to the Treasury action.

Eventually, all the comments submitted will be accessible at the regulations.gov website, but until then, here are some of the more significant comment letters we’ve seen. Definitely worth a read if you have clients or businesses affected by the proposed rule:

S Corporation Association
Family Business Estate Tax Coalition (NFIB-led coalition)
American Institute of Certified …

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admin2019-02-01T19:49:54+00:00November 3, 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|

S Corps Exempted from 385 Rules

Here’s a bit of good news for the S corporation community – Treasury has exempted them from the newly published rules under Section 385.

This is a huge relief to the S corporation community. The rules would have hit S corporations the hardest, despite them having no skin in the “base erosion” game. S corporations would have suffered through the new reporting requirements and limitations on cash pooling and related party loans just like their C corporation counterparts, but they also would have faced the prospect of losing their S corporation status, together with the multitude of tax and penalty …

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admin2019-02-01T19:49:54+00:00October 14, 2016|

Latest on 385

It looks like the IRS and Treasury have made their revisions to the proposed 385 regulations and are just waiting for sign-off from the White House. According to our friends at Politico:

Tax lawyers just held a big confab in Boston, and, not surprisingly, it was rife with speculation about just what the Treasury Department’s final Section 385 rules might contain. Tax Analysts sifted through some of the unanswered questions and predictions now that Treasury has sent final rules to the White House, including whether the department would only finalize part of the extensive anti-inversion rules it rolled out …

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admin2019-02-01T19:49:54+00:00October 5, 2016|

Business Community Rallies

Thousands of family businesses signed a letter this week calling on the Department of the Treasury to withdraw proposed regulations that target family businesses for sharply higher gift and estate taxes.

Getting that many private companies to weigh in on a public issue like this one is simply astounding, and should serve as an indication of just how threatening these regulations are to the ability of family businesses to survive from one generation to the next. As Law360 reported on the letter:

NAM released a letter with more than 50 pages of signatures urging Lew to pull the proposed regulations, …

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admin2019-02-01T19:49:54+00:00September 30, 2016|