News Updates

We Stay Up-To-Date on Flow-Through Tax News and Precedents So You Don't Have To.

Below you will find recent rulings and updates affecting flow-through taxes and closely-held business structures. If you have any questons on these, or about any updates on other sites, please do not hesitate to reach out to us for further insights.

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Treasury and IRS Reverse Position on Related-Party Basis-Shifting Transactions

04/21/2025
News

On April 17th, the IRS issued Notice 2025-23 announcing the intent of the IRS and Treasury to remove basis-shifting transactions as transactions of interest that require reporting under Reg. §1.6011-18 and not to issue proposed related-party basis adjustment regulations, as had been announced in Notice 2024-54.

04/18/2025
News

On “Tax Day,” two new developments addressing the §1402(a)(13) limited partner exclusion from SE tax were published. As has been well-chronicled in our email blasts and at our TAX FORUM programs, the eligibility of a partner who provides substantial services to a personal service-type partnership to qualify for the §1402(a)(13) exclusion for allocations of income received with respect to an interest held as a limited partner is, perhaps, the most contentious issue in the partnership arena in decades. (To date, all the cases appear to involve only partners who are providing full-time services to the partnership.)

04/07/2025
News

As Tax Season #2 winds down (March 15th being Tax Season #1), we thought it would be interesting to pass on a compliance issue that was raised with us at the end of last week by one of our TAX FORUM attendees.

04/01/2025
News

Just recently, we were focusing on a §1202 stock eligibility question for a client, and we decided to listen to a §1202 webinar to determine whether the speakers had focused on a particular issue.

03/25/2025
News

We’re guessing that many of our readers are fully ensconced in Tax Season #1 and might welcome some “light reading” to take their minds off the tasks at hand. With that in mind, we’d like to share our take on a recent interesting Tax Court case that came to our attention.

02/11/2025
News

On January 31, 2025, the IRS Office of Chief Counsel released CCA 202505027 invalidating an agreement to extend the statute of limitations where an individual who signed the extension was different than the individual designated as the Partnership Representative (“PR”) on the Form 1065 filed with IRS (or the Designated Individual (“DI”) if an entity is the PR). Generally, the statute of limitations is three years from the date the return is filed or its original due date, whichever comes later. (§6235(a).) Code §6235(b) allows a taxpayer to extend the statute of limitations by agreement with the IRS, and if the taxpayer is a partnership subject to the BBA, Form 872-M, BBA Consent to Extend Time for Making Adjustments to Partnership-Related Items, is used to extend the statute to a specified date agreed to by the IRS and the partnership.

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None of the authors is rendering legal, accounting or other professional advice. If such advice is required, it is strongly recommended that a professional advisor be engaged.