U.S. TAX COURT RULING: IRS LACKS AUTHORITY TO ASSESS PENALTIES UNDER SECTION 6038(b)
On April 3, 2023, the United States Tax Court (“Tax Court”) issued a decision in Farhy v. Commissioner, 160 T.C. No. 6 (April 3, 2023) in which it determined that the Internal Revenue Service (“IRS”) does not have the statutory authority to assess penalties imposed by Section 6038(b) of the Internal Revenue Code (the “Code”). …
FGMK Tax Alert – Secure Act 2.0 Impact to Qualified Retirement and 529 Plans
As part of the $1.7 trillion spending bill Congress passed and President Biden signed into law at year-end, a series of new laws—known collectively as Secure Act 2.0—has provided favorable changes to both qualified retirement plans and Section 529 plans. This FGMK Tax Alert provides a summary of these key changes. Changes to …
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Does Your Foreign Corporation Need a U.S. Tax Return?
Foreign corporations need to evaluate their U.S. activity to ensure they stay in compliance with the Internal Revenue Service’s filing obligations. Several factors, including the existence of a trade or business and nature of and extent of economic activities can impact or otherwise create a filing requirement. This FGMK article highlights key considerations for foreign …
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Wire and ACH Fraud: 5 Steps to Reduce Your Chances of Becoming the Next Victim
Wire and ACH fraud is on the rise. It is possible you and your company have already experienced it, or you know someone that it happened to, or you have read stories about it. The question to be asked is: “Why wait for this to happen to you or your company (possibly again) to take …
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FGMK Tax Alert – The Inflation Reduction Act of 2022
On Sunday, August 7, 2022, the United States Senate passed the Inflation Reduction Act of 2022 (the “Act”) in a 51 – 50 vote with Vice President Harris providing the tie-breaking vote. The House of Representatives subsequently passed the legislation on Friday, August 12, 2022 in a 220-207 vote, with no Republicans joining Democrats in …
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FGMK Tax Alert – Summary of Key Tax Provisions in President’s FY2023 Budget
On March 28, 2022, President Biden released his FY2023 budget (the “FY2023 Budget”), and the U.S. Treasury released the so-called “Green Book,” which provides details related to the revenue provisions in the FY2023 Budget. This FGMK Tax Alert provides a summary of the salient tax provisions offered under this proposal. Increased Tax Rates, New …
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U.S. International Tax 2022 Health Check
While significant current developments in international tax are evolving (potential U.S. tax reform, adoption of OECD’s Pillar One and Two, recently issued foreign tax credit regulations, etc.) companies and individuals with multi-national operations or interests should assess how they are positioned globally from a tax efficiency standpoint for what might be coming in potential tax …
House Ways and Means Committee Tax Proposal Includes Significant Retirement Planning Modifications
The House Ways and Means Committee proposal provides significant changes to the administration and taxation of individual retirement accounts. A particular focus was placed on those who hold IRA account balances in excess of $10 million. Provided below is a summary of the proposed changes. Prohibition of IRA Contributions Taxpayers would be prohibited …
Illinois Extends Certain Income Tax Deadlines to July 15, 2020
On March 25, 2020, the Illinois Department of Revenue (“IDOR” or “Department”) announced the extension of certain income tax filing and payment deadlines in response to the COVID-19 outbreak, in light of the federal government providing similar taxpayer relief in Notice 2020-18. The IDOR issued Informational Bulletin FY 2020-24 (the “Bulletin”) outlining its guidance to …
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Tax Treatment of Carried Interests: Comparing Carried Interests to Capital Interests, 83(b) Elections, and Issues with the New Three-year Rule
Part I: Capital Interests vs. Carried Interests What is a carried interest? A carried interest (also referred to as a profits interest) is a typical piece of the compensation package for managers of private equity funds.[1] Many private equity funds purchase businesses, operate them for a short period, and then sell them for …