As tax planning practitioners, we do not typically see issues we deal with daily become the subject of cases before the United States Supreme Court. This term, we had the Connelly[1] case involving estate tax valuation of a decedent’s stock in a corporation funding a redemption buy-sell with corporate-owned insurance. Shortly thereafter, the Supreme Court…
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In a previous writing, I discussed the potential of an executor to be personally liable for a decedent’s tax obligations.[1] That discussion was based on lessons learned from a Tax Court opinion,[2] outlining certain steps for executors to consider in minimizing exposure to such personal liability. In 2023, in a split decision, the Ninth Circuit…
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Many individuals take out life insurance policies for valid planning reasons which later are no longer needed or desirable. Alternatively, the policy owner may need current liquidity. While many policies can be surrendered for their cash value or the owner may take loans against the policy, there may be other options. One of those options…
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Tax rules relating to S corporations are a frequent and often time-consuming problem. With the release of Revenue Procedure 2022-19[1], the IRS just made it easier for S corporations to confirm compliance with tax rules and also has eased the administrative burden on the IRS in dealing with these taxpayers. The Internal Revenue Code provides…
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Many practitioners think limiting creditors of an LLC member to a “charging order” is a panacea. Other practitioners think the benefits of charging orders are overblown. Who is correct? Can a member’s judgment creditor access LLC property? In addition to a recent case from the Alabama Supreme Court[1], two other recent cases illustrate how charging…
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In yet another set of headlines involving a conservatorship, Hank Williams, Jr.’s son, Sam Williams, has posted on social media that his family has placed him in a conservatorship, starting in August 2020, which he wants to end.[1] Apparently, this conservatorship was opened to protect Sam while grieving after the death of Sam’s sister in…
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The Multistate Tax Commission (“MTC”) has recently started its Project on State Taxation of Partnerships (“Project”).[1] The proposed scope of the Project is to consider a number of issues relating to state taxation of income associated with partnership income or partner income from the sale of partnership interests. Importantly, the Project is commencing on the…
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We regularly see continuing education materials, blog posts, publications, and other materials titled “LLC v. S Corp. – Which is Right for Your Business?” or something similar. Regardless of the exact title, these items purport to ask the question of whether an LLC or S Corp. is the better choice of entity. But is that…
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Introduction A couple of years ago, I wrote about the state income taxation of trusts.[1] Since that time, there have been some significant developments relating to the issues raised in that writing. Primary among those developments include the United States Supreme Court decision in the Kaestner[2] case and the United States Supreme Court’s decision to…
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