Understanding Who Is a “Farmer” for Federal Tax Purposes As an attorney and CPA working with agricultural clients, I begin many engagements by clarifying what it means to be a “farmer” for federal tax purposes. Many individuals assume that selling crops, raising cattle, or operating a small orchard automatically makes them “farmers.” However, the Internal
Why Worker Classification Matters More Than Ever Worker classification is not a mere paperwork choice between issuing a Form W-2 or Form 1099. It is a multi-dimensional legal determination that turns on whether, in substance, a worker is economically dependent on a putative employer or is truly in business for himself or herself. In wage-and-hour
Understanding the Strategic Opportunity in Converting a Rental to a Principal Residence Converting a rental property into your principal residence can unlock meaningful tax benefits, but those benefits arise under a patchwork of statutes and regulations that require precise timing, careful documentation, and disciplined reporting. The most well-known advantage is the potential use of the
Understanding the Role of Non-U.S. Trusts in Asset Protection Non-U.S. trusts occupy a distinct position in cross-border asset protection planning, combining private law trust principles with jurisdictional advantages not available domestically. The primary objective is to interpose a legally recognized fiduciary relationship, under the law of a reputable foreign jurisdiction, between assets and potential claimants.
The New Tax Nexus Landscape for Remote Work Remote work has reshaped corporate and individual tax exposure by shifting where work is actually performed, which can create or intensify state tax nexus. Nexus can be triggered by a single employee working from home in a state where the employer previously had no physical footprint. This
The Federal and State Framework Governing Employee Arbitration Agreements Employee arbitration agreements sit at the intersection of federal and state law. At the federal level, the Federal Arbitration Act imposes a strong policy favoring arbitration, but it does not automatically validate every clause an employer drafts. State contract principles govern formation, defenses, and interpretation, and
Why a Business Associate Agreement Is Not Optional Under HIPAA For any covered entity or business associate that handles protected health information, a Business Associate Agreement is not a mere formality. It is a binding contract that implements specific regulatory requirements under the HIPAA Privacy, Security, and Breach Notification Rules and the HITECH Act. In
Goodwill impairment under ASC 350 is frequently misunderstood as a simple valuation exercise. In reality, it is a multi-stage legal, accounting, and valuation analysis that must be anchored in rigorous documentation, robust internal controls, and defensible assumptions. A misstep at any point can have cascading effects on financial statements, debt covenant compliance, and management credibility
Begin With a Clear Tax Map: What “Repatriation” Actually Means Tax-efficient repatriation begins with a precise understanding of what you are moving and why. “Repatriating foreign earnings” is not a monolith. It can involve cash distributions, non-cash dividends, intercompany loan repayments, capital reductions, share redemptions, liquidation proceeds, or even service fee flows. Each pathway has
Understanding Grantor Trusts in Modern Tax Planning Grantor trusts are a cornerstone of sophisticated wealth transfer and income tax planning. Properly structured, a grantor trust allows the grantor to be treated as the owner of trust assets for income tax purposes while still removing those assets from the grantor’s gross estate for estate tax purposes.
Define Strategic Objectives and the Role of a Recapitalization A private equity recapitalization is frequently misunderstood as a mere liquidity event. In practice, it is a strategic reallocation of risk, governance, and future value between founders, management, and a financial sponsor. Before engaging a buyer, articulate what the business and its owners intend to achieve:
Understanding the Baseline: Citizenship, Residency, and Eligibility Under U.S. Corporate Law In most U.S. jurisdictions, there is no per se prohibition on a non-U.S. citizen serving as a director of a corporation. State corporate statutes, including those of Delaware, New York, and California, generally do not impose citizenship or U.S. residency requirements for directors. The
Deferring capital gains on commercial real estate is not a single tactic; it is an integrated tax planning exercise that involves sophisticated structures, strict statutory timelines, and careful coordination among legal, tax, and transactional advisors. As an attorney and CPA, I routinely see investors underestimate elements such as depreciation recapture, state conformity, related-party limitations, and
Understanding the Energy Efficient Commercial Buildings Deduction at a Glance Section 179D provides a potentially substantial deduction for energy efficiency improvements to commercial buildings and certain multifamily buildings that are four stories or taller. While it is often described casually as a simple “per-square-foot write-off,” the statute is intricate and includes technical engineering requirements, wage
What the IRS Hobby Loss Rules Are and Why They Matter The so-called “hobby loss rules” refer to Internal Revenue Code Section 183, which limits deductions for activities not engaged in for profit. If the IRS determines that your activity is a hobby rather than a business, the agency will restrict or disallow losses; this
Scope of the WARN Act and Who It Covers The Worker Adjustment and Retraining Notification (WARN) Act requires many private employers to provide advance written notice before certain workforce reductions. In practice, the statute applies to business enterprises with 100 or more full-time employees, or 100 or more employees whose regular weekly hours in the
Understanding the Reverse Morris Trust and Up-C Combination A Reverse Morris Trust is a complex corporate reorganization technique that allows a parent corporation to divest a business on a tax-deferred basis by combining a tax-free spin-off under Section 355 with a merger of the spun entity into a third party. An Up-C structure involves a
Understanding Which Registrants Must File and Why the Scope Is Broader Than It Appears Under Rule 13p-1 promulgated pursuant to Section 1502 of the Dodd-Frank Act, any issuer that files periodic reports under Sections 13(a) or 15(d) of the Exchange Act must assess whether tin, tantalum, tungsten, or gold (often referred to as 3TG) are
Understanding the Difference Between IRS Subordination and Discharge Taxpayers and even seasoned lenders often conflate subordination, discharge, withdrawal, and release in the context of a federal tax lien. These are distinct legal outcomes with different statutory standards and practical effects. A subordination does not remove the federal tax lien. Rather, it permits a specified creditor’s
Understand What Triggers Broker-Dealer Status Many well-intentioned companies assume a casual “introduction fee” or a one-page finder agreement is benign. In reality, the United States securities laws define broker activity broadly, and seemingly simple referral arrangements can trigger broker-dealer registration requirements under Section 15(a) of the Securities Exchange Act of 1934. You are at higher
