Tax

The fiscal cliff deal extended the 100% qualified small business stock exemption for federal purposes. California tax authorities, however, have taken a restrictive and limiting view and have announced that the exemption will not be allowed for state income tax purposes.Under recently proposed SB 209, (1)...

The Fiscal Cliff deal last January renewed and extended through 2013 a little-known film and TV tax incentive under section 181 of the Code. Basically, in 2004, Congress passed legislation allowing a deduction of up to $15 million for investment US production.Absent this legislation, investors...

For federal income tax purposes, the IRS view is that a partner (or member of an LLC that is taxed as a partnership) cannot be an “employee” for tax purposes and instead must be taxed as a “partner” on their share of the LC’s income.The...

Apportionment is the division of an entity’s income between all states in which it has a presence. The unitary-business principle attempts to prevent entities from shielding income from apportionment by dropping an income-producing business division into one or more subsidiaries that operate in different states...

In a little noted but hugely significant provision of the American Taxpayer Relief Act of 2012 (“ATRA”), Congress has extended the 100% exclusion from tax for gains from the sale of Qualified Small Business Stock (QSBS) held for more than 5 years. Although it seems...

Delaware LLCs required to pay taxes in CaliforniaMany limited liability companies (LLCs) are formed under non-CA law (often Delaware), even if they are managed from California, to obtain the perceived benefits of Delaware law. The downside of filing in California is the $800 per year...

The Internal Revenue Service (IRS) has finally issued final regulations on the tax treatment of non-compensatory options and convertible instruments issued by a partnership. These rules are particularly interesting to companies that have formed as LLCs taxed as a partnership for tax efficiencies but have...

By David SpenceOn January 1, 2013, the generous estate and gift tax provisions in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (“2010 Tax Relief Act” or “the Act”) are set to expire. The Act lowered estate, gift, and GST taxes...

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