On March 8, 2012, the Senate amended the surface transportation bill (S. 1813) to include provisions that would allow the United States Treasury to prohibit United States banks from honoring credit cards or accepting wire transfers from foreign banks that the Treasury considers to “significantly impede” United States tax enforcement. Under the bill, the Treasury’s [...]

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Spurred by the requirements set forth in the Foreign Account Tax Compliance Act (FATCA), on February 8th, the governments of France, Germany, Italy, Spain, the United Kingdom, and the United States agreed to implement a system for government-to-government sharing of bank account information of their citizens and residents. On February 24, it was reported that [...]

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In 2010, the U.S. government enacted the Foreign Account Tax Compliance Act (FATCA), containing provisions that would require, starting in 2013, foreign financial institutions (FFIs) to provide to the IRS the personal information of any United States persons holding accounts at that FFI. See http://rroyselaw.com/blog1/2012/01/12/third-offshore-voluntary-disclosure-program-announced-by-irs/.The Proposed Treasury Regulations published on February 8th push the effective date [...]

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Under Section 6045B of the Internal Revenue Code of 1986, as amended (the “Code”) many corporations are required to file a new return (Form 8937) with the IRS in connection with non-dividend distributions and other corporate actions affecting stock basis. More specifically, starting in 2011, the issuer of “specified securities” shall file a return with [...]

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In 2009 and 2011 the Internal Revenue Service (IRS) created two temporary initiatives to allow U.S. taxpayers with unreported income relating to undisclosed foreign bank or financial accounts to make a voluntary disclosure to get current with their taxes and information filing obligations. On Monday, January 9, 2012, the IRS announced a third initiative with [...]

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On Nov. 15, 2011 the Internal Revenue Service (IRS) released guidance on the application of the Section 108(e)(8) to cancellation of indebtedness (COD) income of partners and partnerships (the “Guidance”).  See T.D. 9557.  The new rules are effective Nov. 17, 2011.
Generally, Section 108(e)(8) provides that when a partnership transfers a capital or profits interest to [...]

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In our blog post from December 2010, we discussed the potential for investors to acquire certain qualified small business stock (“QSBS”) and be eligible to exclude 100% of the gain realized on a subsequent sale of that QSBS, if held for at least five years. That 100% gain exclusion for QSBS was enacted by Congress [...]

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Shareholders of Subchapter S Corporations frequently sell their stock and are inspired, either by their own tax professionals or the tax professionals of the buyer, to make a Section 338(h)(10) Election to treat such sale of stock as a sale of assets for tax purposes. The expectation is that the buyer can obtain a valuable [...]

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The Franchise Tax Board of California has announced the Voluntary Compliance Initiative 2 (VCI 2) as an opportunity for taxpayers with underreported California tax liabilities relating to either (i) abusive tax avoidance transactions (ATATs) or (ii) offshore financial arrangements (OFAs), to amend their tax returns for 2010 and prior years and obtain a waiver of [...]

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On August 31, the IRS Offshore Voluntary Disclosure Initiative is closing. The Initiative allows U.S. taxpayers with unreported income relating to undisclosed foreign bank or financial accounts to make a voluntary disclosure to get current with their taxes and information filing obligations for the past 8 years. When the program closes later this month, U.S. [...]

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