By: Amanda Wilson
It looks like Congress will be delivering an early Christmas present. in the form of permanent extenders package. The Protecting Americans from Tax Hikes Act of 2015 (“PATH Act”) is expected to be approved by Congress this week.
More Information about New Partnership Audit Rules
By: Amanda Wilson
A more detailed discussion of the impact of the new partnership audit rules can be found here.
Worthless Debt Deduction – A Cautionary Tale
By: Amanda Wilson
For partnership, individuals and other types of taxpayers that are not in the business of making loans, the main avenue for tax relief when a loan goes bad is Section 166 – the bad debt deduction. In order to claim this deduction, the taxpayer must show that the debt has become wholly worthless during the tax year in which the deduction is claimed. This can often be a very difficult burden for taxpayers, especially if there is no external event that they can identify as a trigger for worthlessness. Even if there is such an event (such as the borrower declaring bankruptcy), worthlessness can be difficult to establish.
New Tax Filing Deadlines for Partnerships and Corporations
By: Amanda Wilson
Last Friday, President Obama signed into law a bill that provides temporary funding for the highway trust fund. Buried in the law are several permanent changes to the tax code that are unexpected. Specifically, the deadline for filing tax returns for partnerships and S corporations has been moved up a month, from April 15th to March 15th. The deadline for filing tax returns for corporations has been moved back a month, from March 15th to April 15th. These changes will apply for tax returns due for tax years starting in 2016. Be aware of how these changes could affect your private business.
Business Tax Reform High Priority
By: Amanda Wilson
Recently, I was at the ABA Tax Section meeting in DC, and one refrain that I heard over and over is that tax reform is a major priority for Congress. The Obama administration has basically shut down the possibility of personal tax reform by threatening a veto on any legislation that lowers the top individual tax rate from 39.6%. However, business tax reform continues to be open for discussion, and there is a strong appetite for lowering the corporate tax rate. The key issue, though, is that any tax reform will have to come soon – before the presidential campaign over shadows everything.