516-227-0700

Working to ensure maximum tax advantages for business and individual clients.

Tax considerations are integral to the structure of virtually every business transaction. The Farrell Fritz team of tax attorneys helps Long Island and New York metropolitan area businesses, charities and individuals with federal, state, and local tax planning across a broad spectrum of matters.

Our tax attorneys also represent clients in all levels of tax controversy work, including IRS and New York audits, IRS Appeals and New York Conciliation Conferences, United States Tax Court, and New York State Division of Tax Appeals. We also secure rulings from the Internal Revenue Service on a variety of tax matters on behalf of clients.

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  • Business Organization and Operation

    Experienced in the various legal and tax issues inherent in how a business is organized and operates, our tax attorneys:

    • Help clients select the most beneficial legal and tax form in which to organize a new business. We are experienced in structuring and advising partnerships, limited liability companies, S corporations and C corporations to address both of these objectives.
    • Offer counsel on tax matters affecting all aspects of business operations, including capital contributions, the admission or removal of a shareholder or partner, distributions, redemptions, recapitalizations, reorganizations and other restructurings, S corporation issues, cancellation or restructuring of indebtedness, and liquidation and dissolution.
    • Advise on the structure of strategic transactions involving either tax-free or taxable sales or acquisitions of stock and assets, including mergers, reverse mergers, spin-offs, and joint ventures.
    • Assist in the preparation of shareholder and partnership/LLC agreements, the resolution of shareholder disputes, the structure of executive and deferred compensation arrangements (including phantom stock plans and stock options) and the settlement of litigated business matters.
  • Real Estate Investments

    Our tax attorneys work with real estate investors on income tax and New York transfer tax matters involving acquisitions, refinancings, leases, dispositions and like-kind exchanges of real property. We also advise owners and charities in connection with the bargain sale of real property and with the granting of conservation easements.

  • Estate and Gift Planning

    We advise individual clients in connection with planning for the disposition of their business and investment assets for estate and gift planning (and business succession) purposes, including recapitalizations, grantor trusts, GRATs, QPRTs, charitable remainder trusts, sales to intentionally defective trusts and family limited partnerships/LLCs. We also represent clients in estate and gift tax audits.

  • Employee Benefit Plans

    The firm’s tax practice encompasses all aspects of ERISA and employee benefits, including the establishment and operation of qualified plans, pensions, health and welfare benefits and related tax issues, including their continued qualification, compliance obligations, and IRS and New York State audits of such plans.

  • Not-for-Profit Creation and Operation

    Private foundations and public charities alike trust the counsel of Farrell Fritz in all stages and aspects of their operations, including the creation of their not-for-profit organizations and the filing of their exemption applications. We represent not-for-profits in corporate restructurings, mergers, joint ventures, executive compensation matters, and dissolutions. In addition, our tax attorneys counsel not-for-profits (and defend them in IRS audits) on issues related to excise taxes and the maintenance of their not-for-profit status, including private inurement, self-dealing, taxable expenditures, jeopardy investments, and excess benefit transactions.

Professionals

Louis Vlahos

Partner
Uniondale

Joseph T. La Ferlita

Partner
Uniondale

Bernadette Kasnicki

Associate
Uniondale

David Neuman

Associate
Uniondale

Recent Blog Posts

Selling S Corporation Stock – Are You Sure?

Still a Valid S Corporation? Much has been written regarding the limitations of the S corporation, especially the requirement that…

September 09, 2019

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September 09, 2019

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Gifting Business Interests: Will the Parent’s Tax Treatment Be Visited Upon the Child?*

The Tax Gene? King of Swamp Castle: One day, lad, all this will be yours. Prince Herbert: What, the curtains?…

September 03, 2019

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September 03, 2019

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Valuing Closely Held Businesses: The Reality of Economic Control?

A Time for Planning? It’s late August – again. As usual, many business owners are looking forward to having all…

August 26, 2019

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August 26, 2019

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Employer-Related Scholarships & The Closely Held Business

Education Equals Indebtedness? We’re more than halfway through the month of August and many college students are returning to their…

August 19, 2019

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August 19, 2019

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Closely Held C Corporations, Constructive Dividends, and More

Choice of Entity The owners of a closely held business are generally free to select the form of business entity…

August 12, 2019

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August 12, 2019

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Business Succession and Trust Fund Taxes: Lessons for Owners and Their Beneficiaries?

Teach Your Children Well [I] It may be the dream of every parent who owns a closely held business that…

July 22, 2019

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July 22, 2019

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Escape from New York — It Will Cost You

If I Had a Dollar . . . How many times have you sat with a client who wants to…

July 16, 2019

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July 16, 2019

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Lou Vlahos Quoted in Forbes’ Recent Article on Monetized Installment Sales

Tax Law for the Closely Held Business blog author Lou Vlahos was extensively quoted in Peter J. Reilly’s July 8 Forbes column…

July 10, 2019

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July 10, 2019

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Monetized Installment Sales: What Are They About?

Too Good . . .? What if I told you that you could sell your property today, receive cash in…

July 01, 2019

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July 01, 2019

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Lou Vlahos Quoted in Forbes’ Recent Wealth Tax Article

Tax Law for the Closely Held Business blog author Lou Vlahos was extensively quoted in Peter J. Reilly’s latest Forbes column.…

June 28, 2019

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June 28, 2019

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The Pervasive Related Party Rule And the Like Kind Exchange

Counting Days Do you know what June 29, 2019 is? Of course you do. It’s a Saturday. It’s also the…

June 24, 2019

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June 24, 2019

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S’s, ESBT’s, NRA’s – AOK?

Letters, acronyms, initialisms[i] – they seem to slip into every post these days. It has always been a goal of…

June 18, 2019

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June 18, 2019

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“Checking the Box” – For a Pass-through Entity In Bankruptcy?

Tax and bankruptcy: “Can two divorced men share an apartment without driving each other crazy”[i] or “Two great tastes that…

June 10, 2019

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June 10, 2019

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Stock Sales and Employee-Minority Shareholders: What Does It Take to Make a Deal?

If you’ve been representing closely held businesses long enough, then the “conversation transcribed” below should sound familiar to you. I…

June 03, 2019

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June 03, 2019

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The Section 199A Deduction & Effectively Connected “Foreign” Income

It’s Not Easy The owners of many closely held businesses recently filed federal income tax returns on which they claimed,…

May 29, 2019

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May 29, 2019

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Is Timing Everything? Only Time Will Tell: Small Business Stock and the Reduced Corporate Tax Rate

The Tax Law In theory, the primary purpose of the income tax, as a body of law, is to raise…

May 20, 2019

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May 20, 2019

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Guarantees: Tax Considerations and Surprises

Don’t Take It Lightly Regardless of who or what they are, taxpayers have to be careful of saying things like,…

May 13, 2019

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May 13, 2019

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Determining the Value of an S Corp

Beyond Income Tax Over the last several weeks, we have explored various aspects of the choice of entity dilemma that…

May 06, 2019

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May 06, 2019

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Insured to Captive: “More, Charge Me More, Charge Me More . . .” Premiums?*

It’s Not All About 2017 A casual review of the recent tax literature may leave a “lay person” with the…

April 29, 2019

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April 29, 2019

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Post-2017: Is It Time To Kick Your Corporation’s “S”?

Choice of Entity Following the enactment of the Tax Cuts and Jobs Act,[i] tax advisers were inundated with inquiries from…

April 22, 2019

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April 22, 2019

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Current Distributions & Partial Liquidations: Corps vs. Partnerships

“You Must Choose, But Choose Wisely.”[I] The enactment of the Tax Cuts and Jobs Act,[ii] and its undeniable bias in…

April 16, 2019

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April 16, 2019

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Checked the Box? Feeling GILTI Now?

Once Upon A Time I recently recalled a client that was referred to us a few years back, shortly before…

April 08, 2019

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April 08, 2019

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Deferring Real Property Gain: Like Kind Exchange or Opportunity Fund? (Part II)

Yesterday, in Part I, we reviewed the like-kind exchange rules. https://www.taxlawforchb.com/2019/04/deferring-real-property-gain-like-kind-exchange-or-opportunity-fund-part-i/ Now we turn to the new kid on the…

April 03, 2019

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April 03, 2019

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Deferring Real Property Gain: Like Kind Exchange or Opportunity Fund? (Part I)

The Act Among the business transactions on which the Tax Cuts and Jobs Act[i] has had, and will continue to…

April 02, 2019

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April 02, 2019

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Lou Vlahos Receives 2019 JD Supra Readers’ Choice Award

Lou Vlahos is a recipient of a JD Supra Readers’ Choice Award in the Tax category for the second year…

March 27, 2019

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March 27, 2019

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Succession Planning and Charitable Bequests: It Pays to Sweat the Details

After Me, Who Cares? In the context of a family-owned business, managerial succession and the transfer of ownership – not…

March 25, 2019

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March 25, 2019

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U.S. Individuals Electing to be Treated as Corporations: American Werewolves?

The Tax Cuts and Jobs Act[i] has been called a lot of things by a lot of different people.[ii] Certain…

March 19, 2019

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March 19, 2019

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Choice of Entity? I Choose A . . . No, I Meant B . . . Wait, Can I Try Again?

Choice of Entity The owners of a closely held business will confront many difficult decisions during the life of the…

March 11, 2019

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March 11, 2019

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New York City’s Unconscionable . . . Unexpected . . . Unincorporated Business Tax – A Glimpse of Things to Come?

Hell of a Town Ask most New Yorkers what New York City has in abundance and you’ll get responses that…

March 04, 2019

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March 04, 2019

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Timing the Sale of a Business . . .To Maximize the Sec. 199A Deduction?

Yes, it sounds odd. It is also seems to be at odds with this blog’s constant refrain of “Thou shalt…

February 25, 2019

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February 25, 2019

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Establishing Taxpayer Intent – Why It Matters

“You Know What I Meant” In order to determine the income tax consequences of a given transaction, a court must…

February 19, 2019

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February 19, 2019

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A Closely Held Qualified Opportunity Fund? It’s Possible, But It’s Not Easy

Committed to a Zone Last week’s post[i] considered how the newly-enacted qualified opportunity zone (“QOZ”) rules seek to encourage investment…

February 11, 2019

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February 11, 2019

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Sale of a Business and Qualified Opportunity Funds: Deferral, Exclusion, and . . . Risk?

A lot has been written about the tax benefits of investing in a Qualified Opportunity Fund. Some have suggested that…

February 05, 2019

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February 05, 2019

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Rental Real Estate and the Sec. 199A Deduction: Round Two

Shortly after Section 199A was added to the Code at the end of 2017, and again after the IRS proposed…

January 29, 2019

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January 29, 2019

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“It’s Ordinary Income – No, I Meant to Say Capital Gain”

We Want You One of the most challenging problems facing a business is how to attract, and then retain, qualified…

January 22, 2019

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January 22, 2019

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Lou Vlahos, Bernadette Kasnicki: TCJA Means Treating Nonprofits More Like For-Profits

Tax Law for the Closely Held Business blog authors Lou Vlahos and Bernadette Kasnicki presented yesterday, January 17, on how…

January 18, 2019

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January 18, 2019

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It’s a Business . . . No, It’s a Charity . . . Wait – It’s a Charity That Is Treated Like a Business?

The Business-Charity Connection As our readers know, this blog is dedicated to addressing the tax-related business and succession planning issues…

January 15, 2019

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January 15, 2019

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Unwinding an Unwanted Transaction

Rescission As kids playing ball, we learned about the “do-over” rule, pursuant to which the player in question was allowed…

January 07, 2019

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January 07, 2019

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All in the Family: The Closely Held Business, the Private Foundation and Indirect Self-Dealing

Home for the Holidays? Our last post considered the division of a business between family members as a means of…

January 02, 2019

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January 02, 2019

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Lou Vlahos Published In National Taxation E-Book

I am excited to announce that my June 18, 2018 blog post “S Corps, CFCs & The Tax Cuts &…

December 26, 2018

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December 26, 2018

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To Gift or Not to Gift? The Time May Have Arrived

The Joy – and Tax Benefits – of Gifting As we enter the “season of giving” and the end of…

December 07, 2018

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December 07, 2018

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Trusts and the Section 199A Deduction

If there was one part of the Tax Cuts and Jobs Act (“TCJA”) that estate planners were especially pleased to…

November 26, 2018

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November 26, 2018

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Plan Ahead to Avoid Tax Surprises and Temptations

“I Didn’t See That Coming” Over the years, I have seen many business owners blanche when they learn how much…

November 19, 2018

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November 19, 2018

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The Nonresident Taxpayer vs New York – “Know When to Fold ‘Em”[i]

NY’s Tax Jurisdiction Last week we considered New York’s “statutory residence” rule pursuant to which an individual domiciled outside of…

November 13, 2018

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November 13, 2018

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Doing Business in New York? Domiciled Elsewhere? Paranoid over New York Residency Status?

Welcome (?) to NY The Tax Foundation recently issued its annual State Business Tax Climate Index. The 2019 Index compares…

November 05, 2018

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November 05, 2018

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Family Limited Partnerships – They’re Still Out There (?)

Dr. Wallace Wrightwood: “You’ve seen hundreds, thousands of pigeons, right?” George Henderson: “Of course.” Dr. Wallace Wrightwood: “Have you ever…

October 30, 2018

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October 30, 2018

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Split-Dollar Life Insurance and S Corps: Distribution or Compensation?

How Does It Work? Many employers struggle to hire and retain key employees. In addressing this challenge, employers will sometimes…

October 22, 2018

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October 22, 2018

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Corporate Distribution: Return of Capital or Capital Gain?

  Ode to a Dividend It sounds relatively simple: A distribution of property made by a regular “C” corporation to…

October 17, 2018

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October 17, 2018

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Assignment of Income And Charitable Contributions of Closely Held Stock

But I Don’t Want to Pay Any Taxes! I was recently speaking to an older client who told me that…

October 08, 2018

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October 08, 2018

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Private Foundations and Business Ownership: A New Day?

Many not-for-profit organizations are dependent, in no small part, upon the generosity of successful businesses and their owners. The latter…

October 01, 2018

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October 01, 2018

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Employment Taxes: Reliance, “Disability” and Reasonable Cause

“Life” Goes On In light of all the attention given to the reams of regulations recently proposed under the Tax…

September 24, 2018

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September 24, 2018

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The Section 199A Deduction . . . and M&A?

I realize that the last post began with “This is the fourth and final in a series of posts reviewing…

September 17, 2018

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September 17, 2018

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The Proposed Sec. 199A Regs Are Still Here! Part Four

This is the fourth[i] and final in a series of posts reviewing the recently proposed regulations (“PR”) under Sec. 199A…

September 11, 2018

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September 11, 2018

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The Proposed Sec. 199A Regs Are Here! Part Three

This is the third in a series of posts reviewing the recently proposed regulations (“PR”) under Sec. 199A of the…

September 06, 2018

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September 06, 2018

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The Proposed Sec. 199A Regs Are Here! Part Two

This is the second in a series of posts reviewing the recently proposed regulations (“PR”) under Sec. 199A of the…

September 05, 2018

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September 05, 2018

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“The Proposed Sec. 199A Regs are Here!”[*] Part One

What follows is the first in a series of posts that will review the long-awaited proposed regulations under Sec. 199A…

September 04, 2018

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September 04, 2018

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Bonus Depreciation: Proposed Regulations and M&A

Earlier this month, the IRS proposed regulations regarding the additional first-year depreciation deduction that was added to the Code by…

August 27, 2018

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August 27, 2018

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Tax Treatment of Success-Based Fees in M&A

Transaction Costs It is a basic principle of M&A taxation that the more a seller pays in taxes on the…

August 20, 2018

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August 20, 2018

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More Related Party Transfers

  Last week, we considered the proper tax treatment for a transfer of funds from a parent corporation to its…

August 13, 2018

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August 13, 2018

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Related Company Transfers: Debt or Equity? Capitalized or Expensed?

It is often difficult to determine the proper tax treatment for the transfer of funds among related companies, especially when…

August 06, 2018

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August 06, 2018

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Shareholders, Transferee Liability, And Corporate Income Tax

The Corporate “Shield” Ask any shareholder of a closely held corporation whether they may be held liable for the tax…

July 30, 2018

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July 30, 2018

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It’s Not an LLC, It’s Not an LP, But Is it a Partnership?

One of the thorniest tasks to confront a tax adviser may be having to determine whether the business or investment…

July 23, 2018

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July 23, 2018

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Shareholder Oppression, S Corps, & A Second Class of Stock?

Woe to the Oppressed Shareholder As I write this post on Bastille Day, I am reminded how an oppressed people,…

July 16, 2018

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July 16, 2018

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Obtaining Tax Return Information: Taxpayer’s Standing, and Timely Requests

Tax Returns Are Like Paintings   [I] A not insignificant portion of our tax practice involves disputes among the shareholders and partners…

July 09, 2018

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July 09, 2018

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Choice of Entity, Shareholder Disputes, and the Discovery of Tax Returns

Decisions, Decisions The reduction in the Federal income tax rate for C corporations, from a maximum of 35-percent to a…

July 02, 2018

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July 02, 2018

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Cannabis, Business Expenses, and the Code

Last week’s post may have left some readers feeling lightheaded or anxious. [1] It is highly unlikely that this week’s post…

June 25, 2018

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June 25, 2018

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S Corps, CFCs & The Tax Cuts & Jobs Act

Pro “C” Corporation Bias? Although closely-held businesses have generally welcomed the TCJA’s[i] amendments to the Code relating to the taxation…

June 18, 2018

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June 18, 2018

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Learning from the Mistakes of Other Taxpayers

“You Mess with the Bull . . .” An often-explored theme of this blog is the frequency with which similarly…

June 04, 2018

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June 04, 2018

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Debt . . . Worthless Debt . . . No Debt at All?

It is said that repetition is the mother of all learning. It is also said that insanity is repeating the…

May 29, 2018

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May 29, 2018

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Shifting Business Activities Between Related Entities?

Metamorphosis      [i] By now, most readers have heard about the benefits and pitfalls of “checking the box” or of failing…

May 21, 2018

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May 21, 2018

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The New York Business And Changing Domicile – “Let it Go, Let it Go”

“Leaving” the Business There is a common theme that runs through the history of most closely held businesses. It begins…

May 14, 2018

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May 14, 2018

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Personal Liability for Sales Tax In N.Y. LLCs

  “Personal liability?!” the client screams. “For sales tax? How is that possible?” The look on their face is at…

May 07, 2018

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May 07, 2018

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You Can Lead Clients to Water, But You Can’t Make Them Drink

Will They Ever Learn? The following probably sounds familiar. You’re meeting with a new client who is being audited by…

April 30, 2018

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April 30, 2018

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Basis Consistency – Between Corporations and Shareholders?

Estates and Beneficiaries I recently encountered a situation in which the so-called “basis consistency” rule was implicated. This rule requires…

April 23, 2018

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April 23, 2018

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New York Reminds Us: “Sale of Intangible Property May be Taxable as Sale of Real Property”

New York’s legislature has been in the news lately after having “rotated an avian creature through more than 90 degrees”[1]…

April 16, 2018

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April 16, 2018

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Is it Debt or Equity? Is it a Dividend or Compensation? It Must be a Closely Held Business

I had a call a couple of weeks ago from the owner of a business. His brother, who owned half…

April 09, 2018

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April 09, 2018

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When Tax Truths Collide: “Disappearing” Basis?

How many times have you said to a client, “Please don’t agree to any deal terms until we’ve had a…

April 03, 2018

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April 03, 2018

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Have Your Business Do Onto You As You Would Have Your Business Do Onto Others (*)

Relationships are Hard The well-being of a closely held business is based, in no small part, upon a number of…

March 26, 2018

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March 26, 2018

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The Closely Held Business & the Minority Owner: Accessing Information from the Entity’s Tax Return?

Why a Minority Owner? I have often asked the question, “Why would someone willingly become a minority owner in a…

March 19, 2018

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March 19, 2018

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The Active Business Owner And Passive Real Property

Why Real Property? It is not unusual for the owners of a closely held business to also own a number…

March 12, 2018

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March 12, 2018

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Trusts and the Corporate Lawyer

Corporate attorneys usually think of trusts as estate planning tools: they are the vehicles through which the owner of a…

March 05, 2018

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March 05, 2018

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Capital Gain or Ordinary Income? Establishing Intent

Last week’s post considered the risk assumed by a taxpayer that ignores the plain meaning of a Code provision (the…

February 26, 2018

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February 26, 2018

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“Interpreting” the Code’s Plain Text

What Does It Mean? The Tax Cuts and Jobs Act[1] has now been in effect for fifty days. During this…

February 20, 2018

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February 20, 2018

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When is a Shareholder’s “Loan” to An S corporation Really a Loan?

Passing Through Losses There is a problem that will sometimes plague the shareholders of an S corp that is going…

February 12, 2018

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February 12, 2018

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Permanent Place of Abode, Proximity to One’s Business, and N.Y. Residence

“Life” Goes On Over the last month or so, most of the nation’s tax practitioners have been devoting an extraordinary…

February 05, 2018

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February 05, 2018

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U.S. Taxation of Foreign Income After Tax Reform

We’ve all heard about the profits that publicly-held U.S. corporations have generated overseas, and how those profits have, until now,…

January 30, 2018

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January 30, 2018

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Will Tax “Reform” Affect Domestic M&A?

Perhaps the single most important day in the life of any closely held business is the day on which it…

January 22, 2018

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January 22, 2018

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The Real Property Business and the Tax Cuts & Jobs Act

Introduction The Tax Cuts and Jobs Act of 2017[1] went into effect only two weeks ago. Many of its provisions…

January 16, 2018

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January 16, 2018

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The Federal Estate Tax Lives On, But “Where, O death, is your sting?” (*)

When the Tax Cuts and Jobs Act[1] was introduced on November 2, 2017, perhaps the single most important issue on…

January 10, 2018

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January 10, 2018

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Some of the TC & JA’s Corporate Tax Changes

Our last three posts focused on those provisions of the Tax Cuts and Jobs Act[1] that apply specifically to pass-through…

January 09, 2018

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January 09, 2018

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The 2017 Tax Act: Other “Pass-Through” Tax Provisions – Part II

Yesterday’s post examined various changes to the taxation of S corporations, partnerships, and their owners. Today, we will focus on…

January 04, 2018

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January 04, 2018

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The 2017 Tax Act: Other “Pass-Through” Tax Provisions – Part I

Our last post reviewed the “20% deduction” that may now be available to the owners of certain pass-through entities based…

January 03, 2018

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January 03, 2018

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The New Deduction for “Qualified Business Income”: Tax Simplification Gone Awry?*

In the weeks preceding the introduction of the bill that was just enacted as the Tax Cuts and Jobs Act…

December 27, 2017

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December 27, 2017

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Revoking S Corp. Status: A Fraudulent Conveyance?

Worlds Collide? I like to tell my partners that there are Codes (upper case “C”), and there are codes (lower…

December 18, 2017

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December 18, 2017

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Trust Fund Tax: Responsible = Liable (?)

Some shareholders are content with being wholly passive investors in a corporation. Others desire some degree of participation in the…

December 11, 2017

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December 11, 2017

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Information Reporting for the Foreign-Owned Not-So-Disregarded Disregarded Entity

Ah, December As we near the end of the taxable year ending December 31, 2017, the thoughts of most people…

December 04, 2017

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December 04, 2017

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Minority Owner Or No Owner at All?

Old Dog, New Tricks? It’s a concern for every new investor in a closely held business: will the founding owners…

November 27, 2017

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November 27, 2017

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S Corp. Shareholder to Tax Court: “Here’s Why I Deserve These Loss Deductions”

A post earlier this year considered the basis-limitation that restricts the ability of S corporation shareholders to deduct their pro…

November 20, 2017

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November 20, 2017

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LLC-to-Partnership Conversion: There’s More to it Than Meets the Eye

Some Days Are Stones[1] It’s not always easy to find a topic about which to write a weekly blog post.…

November 13, 2017

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November 13, 2017

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Rental Income or Self-Employment Income?

Skirting Employment Tax? The Code imposes the self-employment tax on the net earnings from self-employment derived by an individual during…

November 06, 2017

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November 06, 2017

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The New Partnership Audit & Collection Regime: Its Time Has Come

Beginning 2018, the IRS is authorized to collect from a partnership any tax deficiencies arising out of the partnership’s operations…

October 30, 2017

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October 30, 2017

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Determining the Appropriate Fee For Services Rendered to a Related Company

This week, we return to two recurring themes of this blog: (I) related party transactions – specifically, transactions between a…

October 23, 2017

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October 23, 2017

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Checking the Box, Partnership Allocations, and Foreign Law

Many of our clients, most of which are closely-held U.S. businesses, are looking to expand their operations overseas. Some are…

October 16, 2017

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October 16, 2017

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“Constructive Gifts” & The Partnership Allocation Rules

Relief? Not So Fast You may recall that the President directed the Treasury Department to identify “significant tax regulations” issued…

October 09, 2017

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October 09, 2017

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Thou Shalt Not Hold Real Property In a Corporation

“When will they ever learn?” No, I am not channeling Seeger. I am referring to those individuals[i] who continue to…

October 02, 2017

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October 02, 2017

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Debt vs. Equity: Form & Substance Matter

Some lessons need to be repeated until learned. It’s a basic rule of life. Don’t tug on Superman’s cape; don’t…

September 25, 2017

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September 25, 2017

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Liquidating a Partnership Interest? Beware the Effects of Partnership Indebtedness

Setting the Stage Over the last couple of months, I’ve encountered several situations involving the liquidation of a partner’s interest…

September 18, 2017

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September 18, 2017

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Withdrawing Your Business from New York? Did You Pay the Exit Tax?

Departing Individuals Many of you may know that an individual who changes his status from New York (“NY”) resident to…

September 11, 2017

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September 11, 2017

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Relief for Late Partnership Filings

Oops? Are you a member of a partnership or of a limited liability company that is treated as a partnership…

September 05, 2017

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September 05, 2017

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“S” Corporation Status, For an LLC?

Choice of Entity One of the first decisions – and certainly among the most important – that the owner of…

August 28, 2017

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August 28, 2017

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Taxpayers Bear the Tax Consequences of Business Decisions

Form v. Substance It is a basic precept of the tax law that the substance of a transaction, rather than…

August 21, 2017

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August 21, 2017

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When a Partner May Not Be Acting As a Partner

It is not uncommon for a partner to engage in a business transaction with a partnership of which he is…

August 14, 2017

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August 14, 2017

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Controlled Foreign Corporation: Neither a Lender, Guarantor, nor Pledgor Be?

Last week, we considered the U.S. taxation of a closely held foreign corporation that owned a minority interest in a…

August 07, 2017

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August 07, 2017

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Foreigner’s Sale of Partnership Interest: Not Taxable

Coming to America Whether they are acquiring an interest in U.S. real property or in a U.S. operating company, foreigners…

July 31, 2017

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July 31, 2017

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Reorganization of Insolvent Corporations: Has A New Day Dawned? Nope

Withdrawal of Proposed Regulations Earlier this year, the President directed the Secretary of the Treasury to review all “significant tax…

July 24, 2017

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July 24, 2017

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Employee Loan or Compensation?

A Borrower and a Lender Be Everyone recognizes the importance of debt financing to a business. The business needs liquidity…

July 17, 2017

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July 17, 2017

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Sale of A Contract: Capital Gain or Ordinary Income?

Maximize Capital Gain In the sale of a business, it is the goal of every business owner and his tax…

July 10, 2017

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July 10, 2017

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“Abandonment of a Partnership Interest,” or “When a Taxpayer Rejects Its Tax Return Position”

“Disposing” of a Partnership Interest If the amount realized by a taxpayer upon the sale of a partnership interest to…

July 05, 2017

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July 05, 2017

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Deducting Payments Between Related Parties

Potential for Abuse Many years ago, Congress decided that taxpayers who were “related” to one another should be required to…

June 26, 2017

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June 26, 2017

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Unreasonable Compensation & The Family Business

“Add-Backs” In the course of valuing a target business, a potential buyer will want to develop an accurate picture of…

June 19, 2017

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June 19, 2017

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Self-Employment Tax, LLCs, & The “Limited Partner” Exclusion

Introduction In general, self-employed individuals are subject to employment taxes on their net earnings. The wages paid to individuals who…

June 12, 2017

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June 12, 2017

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Contributing Encumbered Assets: Partnership Disguised Sale Rules

Many of  our posts  this year have considered some of the unique issues that are presented by a partner’s contribution…

June 05, 2017

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June 05, 2017

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Restricted Stock & Employee-Shareholders

Close Corporations and Compensatory Grants of Equity It should come as no surprise to readers of this blog that I…

May 30, 2017

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May 30, 2017

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Guidance for North-South Spinoffs

The IRS continues to issue guidance in the much debated area of corporate spinoffs. A recently published ruling examined the…

May 22, 2017

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May 22, 2017

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Why Care About Business Valuation? Part II

Missed Part I?  Check it out here! “Related Party” Transactions Transfer Pricing Valuations figure prominently in determining the proper tax…

May 16, 2017

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May 16, 2017

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Why Care About Business Valuation? Part I

One word: “taxes.” There are so many transactions in which the tax consequences visited upon a closely-held business and its…

May 15, 2017

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May 15, 2017

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Paying The Estate Tax

An Unreasonable Burden? One of the reasons often given in support of the elimination of the estate tax is the…

May 08, 2017

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May 08, 2017

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S-Corps, Basis & Loss Limitations

In General It is a basic principle of federal tax law that a taxpayer cannot, for purposes of determining the…

May 01, 2017

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May 01, 2017

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Beyond Purchase Price: The Tax Treatment of M&A Deal Costs

Recovering Transaction Costs It is a basic tax principle that the more a seller pays in taxes on the sale…

April 24, 2017

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April 24, 2017

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Foreign Investment in U.S. Real Property: Gift And Estate Tax Considerations

Last week, we reviewed the various U.S. federal income tax consequences that may be visited upon a foreign person who…

April 17, 2017

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April 17, 2017

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Tax Considerations For The Closely-Held Foreign Investor In U.S. Real Property – Part II

Catching up? Start with Part I here. Sale of USRP – FIRPTA Aside from planning for the taxation of U.S.-sourced…

April 11, 2017

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April 11, 2017

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Tax Considerations For The Closely-Held Foreign Investor In U.S. Real Property – Part I

Over the last few years, we have received an ever-increasing number of inquiries from “foreigners” who are interested in acquiring…

April 10, 2017

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April 10, 2017

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Private Foundations: A Primer for the Business Owner

The Charitably-Inclined Business Many successful business owners attribute some part of their financial success to their community. The term “community”…

April 03, 2017

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April 03, 2017

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An Overview Of The NYC Business Tax Environment

NYC Never Sleeps – But It Does Tax “If I can make it there, I’ll make it anywhere.”  So begins…

March 27, 2017

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March 27, 2017

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A Buyer’s Guide to Acquiring Target’s Assets With A Stepped-Up Basis

Oops The last few posts have focused upon the “tax-free” contribution of property to a partnership. Today, we’re “doing a…

March 20, 2017

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March 20, 2017

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Effecting Exchanges of Property Through a Partnership

A Continuing Investment In the last two posts, we saw how a Taxpayer who transfers Property A to a partnership…

March 13, 2017

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March 13, 2017

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Protecting Tax Deferral for A Contribution to A Partnership

Contributing Property to A Partnership When a taxpayer (“Taxpayer”) sells a property (“Property”) with a fair market value (“FMV”) in excess of Taxpayer’s…

March 06, 2017

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March 06, 2017

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When A “Tax Free” Exchange May Not Be Free of Tax

“Tax free” – two words that often bring great delight when they are spoken by a tax adviser to the…

February 27, 2017

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February 27, 2017

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N.Y.’s 2018 Budget Proposal: Tax Proposals To Watch

Last month, Governor Cuomo presented his budget proposal for NY State’s 2017- 2018 fiscal year. Included in the proposal were…

February 21, 2017

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February 21, 2017

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Reporting A Closely Held U.S. Corporation’s Overseas Activities

Looking Overseas We have heard a lot about large, publicly-traded U.S. corporations that have parked trillions of dollars overseas to avoid…

February 13, 2017

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February 13, 2017

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Shareholder Liability For Corporate Income Tax?

Limited Liability In general, the creditors of a corporation cannot recover the corporation’s debts from its shareholders—the shareholders enjoy the…

February 06, 2017

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February 06, 2017

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Rolling Over Target Equity Into A PE Fund: Part II

Roll-Over: Tax Issue Picking up on yesterday’s discussion, how can a PEF reconcile its preference to acquire a depreciable or…

January 31, 2017

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January 31, 2017

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Rolling Over Target Equity Into A PE Fund: Part I

For many business owners, the final step of a successful career may be the sale of their business. At that…

January 30, 2017

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January 30, 2017

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Loans Between Related Entities

What Was Intended? Over the last thirty years, I have reviewed the income tax returns of many closely held corporations…

January 16, 2017

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January 16, 2017

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When Investing In A Partnership May Be A Tax Problem

Double Taxation A business entity that is treated as a “flow-through” for income tax purposes enjoys the benefit of a…

January 09, 2017

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January 09, 2017

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Who Is The Taxpayer?

Back to Basics This is not a silly question. In fact, it is often one of the most difficult issues…

January 03, 2017

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January 03, 2017

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Articles & Advisories

Not-for-Profits & the Tax Cuts and Jobs Act of 2017

The new federal tax law that went into effect at the beginning of this year, the “Tax Cuts and Jobs…

January 02, 2019

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S Corps, CFCs & The Tax Cuts & Jobs Act

Louis Vlahos, partner, was published in Chapter 6 of the e-book publication The Tax Cuts and Jobs Act: A Guide for…

December 26, 2018

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THE NEW TAX LAW: What Businesses Can Expect

The question we hear most from domestic business owners about the TCJA is, “How much will IRC Section 199A 20…

May 09, 2018

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“Tax-Free” Exchanges May Not Be Free of Tax

Business owners love to hear the words “tax-free” when considering the disposition of business assets. Unfortunately, many fail to grasp…

June 07, 2017

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Elder Law/Trusts & Estates: Disposing of Real Property in a Tax-Advantaged Manner

This article is reprinted with permission by the Nassau County Bar Association. Many of our clients are heavily invested in…

March 01, 2017

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Did You Say a Taxable Partnership?

To learn about partnerships, partnership audits, the Bipartisan Budget Act of 2015 (“BBA”), the BBA’s changes, the “taxable partnership” and…

July 08, 2016

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“Partnering” With an S Corp.

Reprinted with permission from The Suffolk Lawyer, January 2016 issue. Why, Oh Why? We’ve heard it before: “Why would you…

February 03, 2016

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SCIN Alive?! A Tale of Death, Taxes, Doubt, and Redemption

Reprinted with permission by The Suffolk Lawyer, Vol. 31, No. 2, October, 2015. Davidson was dead to begin with —…

October 23, 2015

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Good Deeds and Good Business

Reprinted with permission from This is Queensborough magazine, February 2014 issue. Many successful business people are also community-minded.  They have…

February 09, 2015

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Arm’s Length Merger or Gift?

Reprinted with permission from The Suffolk Lawyer, Vol. 30, No. 4, January 2015.   Every now and then, a case…

January 15, 2015

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News

Made money on bitcoin? IRS wants a bite!

The IRS is coming after cryptocurrency traders. And the government isn’t being nice about it. At the end of July,…

August 06, 2019

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Clever Techniques To Defer Capital Gains – Maybe Too Clever

Does MIS Work? Mr. Greenwald told me that he thinks [monetized installment sales] work provided the transaction is executed as…

July 10, 2019

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Wealth Tax – That Pesky Constitution Might Get In The Way

I reached out to Louis Vlahos of Farrell Fritz for some thoughts on the constitutionality of a wealth tax.  After a pretty…

June 27, 2019

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Whether a Taxpayer Qualifies for 199A Depends on Who You Ask

Disagreements over business owners’ use of the new passthrough deduction and the application of the aggregation rules have made for…

April 19, 2019

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Selling Your Business – Watch Out For Effect On 199A Pass-Through Deduction

My conclusion is that 199A considerations are unlikely to make or break a deal and in many contexts, they will…

April 05, 2019

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Zone Defense: Panel Discusses Limits and Advantages of New Opportunity Zones Program

Louis Vlahos, partner at Farrell Fritz, is quoted in this Long Island Business News article. The opportunity zones program, which…

February 21, 2019

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Speakers: TCJA Means Treating Nonprofits More Like For-Profits

The Tax Cuts and Jobs Act has a number of provisions that both directly and indirectly affect not-for-profit organizations, but…

January 18, 2019

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Property Rules

Why investing in real estate can boost your retirement income. Louis Vlahos, partner at Farrell Fritz, was quoted in this…

January 14, 2019

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Boom time ahead for Long Island?

Louis Vlahos, partner, who leads the Farrell Fritz tax practice group is quoted in this article. Tax reform, Wayfair case and…

August 01, 2018

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To C or Not to C?

Louis Vlahos, partner at Farrell Fritz is mentioned in this article. C-Corp offers tax treasures and traps as new code…

July 09, 2018

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Press Releases

30 Farrell Fritz Attorneys Recognized as 2018 Leading Lawyers in Their Respective Areas of Practice

Farrell Fritz had a combined total of 30 attorneys selected to the 2018 New York Metro Super Lawyers and New…

September 13, 2018

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Farrell Fritz Welcomes David J. Neuman as a Corporate Associate

David J. Neuman, a Woodmere, NY resident, is a corporate associate concentrating in tax law. He is resident in Farrell…

May 02, 2018

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31 Farrell Fritz Attorneys Recognized as 2017 Leading Lawyers in their Respective Areas of Practice

Farrell Fritz had a combined total of 31 attorneys selected to the 2017 New York Metro Super Lawyers and New…

September 20, 2017

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30 Farrell Fritz Attorneys Recognized as 2016 Leading Lawyers in their Respective Areas of Practice

Farrell Fritz had a combined total of 30 attorneys selected to the 2016 New York Metro Super Lawyers and New…

September 21, 2016

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Farrell Fritz Welcomes Jason Tomitz, Tax Associate, to its Uniondale Office

Farrell Fritz is pleased to welcome Jason Tomitz to its Uniondale office as a tax associate. Prior to joining Farrell…

June 09, 2016

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30 Farrell Fritz Attorneys Recognized as 2015 Leading Lawyers in their Respective Areas of Practice

Farrell Fritz had a combined total of 30 attorneys selected to the 2015 New York Super Lawyers and New York…

September 16, 2015

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Katherine A. Heptig of Farrell Fritz Named Chair of a Nassau County Bar Association Committee

Farrell Fritz is pleased to announce that Katherine (Kate) A. Heptig has recently been named Chair of the Nassau County…

June 18, 2015

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Farrell Fritz Promotes Patricia Marcin to Partner and Three Associates to Counsel

Farrell Fritz is pleased to announce the promotions of Patricia C. Marcin to partner and John C. Armentano, Katherine A.…

January 07, 2015

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30 Farrell Fritz Attorneys Recognized as 2014 Leading Lawyers in their Respective Areas of Practice

Farrell Fritz had a combined total of 30 attorneys named to the 2014 New York Super Lawyers and New York…

September 23, 2014

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Farrell Fritz Partner Louis Vlahos Recognized at SmartCEO 2014 CPA & ESQ Awards Program

Farrell Fritz is pleased to announce that partner Louis Vlahos was an Attorney of the Year finalist at Citibank’s SmartCEO…

June 30, 2014

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Pro Bono

Helping Queens Reach its Full Potential

The Flushing Willets Point Corona Development Corporation is an organization comprised of private and public sector stakeholders that seeks to…

August 10, 2011

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Long Island Arts Alliance

Thanks to Long Island’s diverse and impressive cultural institutions, residents don’t have to go far to see a Rodin or…

January 01, 2010

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Nassau County Museum of Art

Farrell Fritz has been in the legal picture for Long Island’s leading art museum for years. Louis Vlahos, who heads…

January 01, 2010

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Long Island Alzheimer’s Foundation

LIAF began in 1988 in typical grass-roots fashion. Five women, each of whom had a parent or grandparent with Alzheimer’s…

January 01, 2010

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Queens Theater in the Park

Queens Theatre in the Park, located in Flushing Meadows Corona Park, is one of the borough’s premier venues for theater,…

January 01, 2010

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A Helping Hand for a Very Special School

Robert Creighton and Lisa Vaccaro helped make a difference for a nonprofit, private Long Island school that was founded to…

January 01, 2010

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A Gift from Alexa

One of the first projects initiated by our firm’s pro bono committee involved reaching out to a new group that…

January 01, 2010

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The Donna Dennis Foundation

Over the years, Farrell Fritz has reached out through its pro bono program to numerous Long Islanders, most of whom…

January 01, 2010

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The Patriot Group

Emergency responders earned a place at the center of the national consciousness after their heroic efforts on 9/11/01. One responder…

January 01, 2010

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East River Development Alliance

“Think Local” is a guiding principle of the East River Development Alliance, an organization founded in 2003 specifically to assist…

January 01, 2010

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On Demand Webcasts

Expert Webcast: Opportunity Zones — Tax Planning for Closely Held Businesses

July 18, 2019

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“Business Purpose” And Dividing The Family Corporation: Think Before You Let it Rip

Lou Vlahos, tax partner at Farrell Fritz, will present this Celesq webcast. The “family” is sometimes described as the smallest…

April 01, 2019

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Qualified Opportunity Zones

Louis Vlahos, tax partner at Farrell Fritz, will be a speaker for the webcast. The panel will be moderated by…

March 19, 2019

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Maximizing Proceeds in Private Company Exits: ESOPs and Other Alternatives

Louis Vlahos, tax partner at Farrell Fritz, will be a speaker for the webcast, along with David Johanson, partner at…

December 13, 2018

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Tax Considerations in M&A for Buyers and Sellers

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Family Business Exit Planning: Key Pitfalls and How to Avoid Them

View Webcast

Liquidity Options for a Closely-Held Company

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The New Section 199A Qualified Business Deduction: Opportunities and Stumbling Blocks for Your Business

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Estate Planning for Business Owners and High Net Worth Families Under the New Tax Law

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Ownership Transfers of Closely Held Businesses

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