Strasburger Tax Strategies News

FIN 48 and Uncertain State Tax Liabilities; A Voluntary Disclosure Agreement May Help

Thu, 19 Nov 2009 13:00:00 CST

by Daniel L. Butcher and James R. Browne
The Financial Accounting Standards Board (FASB) recently reaffirmed its decision to require private companies to implement radically new accounting rules for uncertain income tax positions, effective for 2009 annual financial statements. For companies that do not pay taxes in all states in which they have sales, the new accounting rules significantly increase the risk that tax liabilities in those states will materialize. These private companies should carefully evaluate their filing responsibilities in those states and seriously consider a voluntary disclosure arrangement with appropriate states to mitigate their potential tax exposure.......

Seventh Circuit Affirms Narrow Application of Accountant-Client Privilege in Federal Tax Matters

Thu, 02 Jul 2009 13:00:00 CST

by James R. Browne
The IRS has announced a new voluntary disclosure program for undisclosed foreign bank or brokerage accounts. This will allow taxpayers who have failed to disclose their ownership of such accounts, failed to file required information returns and/or failed to report income from such accounts, to correct those failures and thereby avoid criminal prosecution. In addition, civil penalties which otherwise potentially could be massive, are capped at lower amounts. The window for disclosure expires on September 23, 2009, and taxpayers who desire to participate in this program should immediately contact their tax advisors to guide them through the process which may present complex legal and tax issues......

IRS' New Offshore Bank Disclosure Program

Tue, 16 Jun 2009 09:00:00 GMT

IRS' New Offshore Bank Disclosure Program by Farley P. Katz
The IRS has announced a new voluntary disclosures program for undisclosed foreign bank or brokerage accounts. This will allow taxpayers who have failed to disclose their ownership of such accounts, failed to file required information returns and/or failed to report income from such accounts, to correct those failures and thereby avoid criminal prosecution. In addition, civil penalties which otherwise potentially could be massive, are capped at lower amounts. The window for disclosure expires on September 23, 2009, and taxpayers who desire to participate in this program should immediately contact their tax advisors to guide them through the process which may present complex legal and tax issues.....

ARRA Temporary COBRA Premium Subsidy

Mon, 30 Mar 2009 09:00:00 GMT

The mammoth American Recovery and Reinvestment Act of 2009 (“ARRA”) was signed into law by President Obama on February 17, 2009. Among its many provisions, ARRA contains a substantial temporary federal government subsidy for COBRA premiums when a covered employee loses his or her job on account of an involuntary termination of employment. While ARRA's COBRA premium subsidy provisions are a major benefit for unemployed workers and their families, they impose significant administrative requirements on employers....

The Worker, Retiree, and Employer Recovery Act of 2008 Suspends Required Minimum Distributions in 2009

Thu, 05 Feb 2009 09:00:00 GMT

In December 23, 2008, President George W. Bush signed the Worker, Retiree, and Employer Recovery Act of 2008 (“WRERA”).1 WRERA makes technical corrections to the Pension Protection Act of 2006 (“PPA”) and amends the PPA, the Internal Revenue Code (“Code”), the Employee Retirement Income Security Act of 1974 (“ERISA”), and the Age Discrimination in Employment Act of 1967 (“ADEA”). Among other things, WRERA suspends the Required Minimum Distribution (“RMD”) rules for 2009 for 401(k), 403(b), governmental 457(f) and other defined contribution plans and individual retirement accounts (“IRA's”) but not for defined benefit pension plans. The RMD suspension is a direct reaction by Congress to limit the downturn in the financial markets and its effect on retirement accounts. It allows participants to postpone selling their investments at current depressed values....

Department of Labor Issues Final Regulations on Qualified Default Investment Alternatives

Tue, 04 Dec 2007 09:00:00 GMT

Department of Labor Issues Final Regulations on Qualified Default Investment Alternatives by Drake A. Frazier
On October 24, 2007, the Employee Benefits Security Administration of the U.S. Department of Labor (“DoL”) published final regulations on the use of default investment alternatives. The final regulations, which take effect December 24, 2007, provide much-needed guidance to employers on fiduciary liability relief extended to investments in qualified default investment alternatives....

409A News Flash: Treasury and IRS Do About Face And Fully Postpone Effective Date of Final 409A Regulations Until January 1, 2009

Mon, 29 Oct 2007 09:00:00 GMT

409A News Flash: Treasury and IRS Do About Face And Fully Postpone Effective Date of Final 409A Regulations Until January 1, 2009 by Luke D. Bailey
409A “Good Faith” Compliance Period For Operational As Well As Documentary Compliance Now Extended Through December 31, 2008....

Texas Taxpayer Amnesty: Comptroller Offers a Limited-time Waiver of Penalties and Interest

Thu, 02 Aug 2007 09:00:00 GMT

Texas Taxpayer Amnesty: Comptroller Offers a Limited-time Waiver of Penalties and Interest by Chris Kotlarz
This article discusses an opportunity provided by Project Fresh Start - A Texas Taxpayer Amnesty Program.....

IRC § 409A Requires Action on Deferred Compensation

Wed, 01 Aug 2007 09:00:00 GMT

IRC § 409A Requires Action on Deferred Compensation by Luke D. Bailey
(Updated: October 29, 2007) Most readers of this Tax Strategies Newsletter will be aware that in late 2004 Congress enacted Internal Revenue Code (“IRC”) § 409A, which imposes new federal income tax rules for nonqualified deferred compensation. The new rules generally apply whenever compensation for services is paid in a calendar year after the calendar year in which the services are performed....

Taxing Private Equity

Tue, 24 Jul 2007 09:00:00 GMT

Taxing Private Equity by James R. Browne
The recent Blackstone Group IPO has prompted a flurry of media reports and political commentary complaining that private equity managers are exploiting tax loopholes and pay too little tax. As frequently happens when news reporters and politicians react to complicated tax issues, misinformation abounds. This newsletter examines three aspects of private equity taxation that are highlighted by the Blackstone IPO and have drawn the most fire from critics: carried interests, publicly traded partnership status, and goodwill amortization. ....

Texas Supreme Court Denies Review of Court of Appeals Decision Holding Texas Franchise Tax Earned Surplus Throwback Unconstitutional

Tue, 19 Jun 2007 09:00:00 GMT

Texas Supreme Court Denies Review of Court of Appeals Decision Holding Texas Franchise Tax Earned Surplus Throwback Unconstitutional by Dan Butcher and Farley P. Katz
In a case in which Strasburger & Price, LLP represented Home Interiors & Gifts, Inc. (“Home Interiors”) a Texas Court of Appeals has ruled that the Texas franchise tax earned surplus throwback provision as applied to Home Interiors unconstitutionally burdens interstate commerce in violation of the Commerce Clause of the United States Constitution. Home Interiors & Gifts, Inc. v. Strayhorn, 175 SW 3d 856 (Tex. App. - Austin, 2005.) The Texas Comptroller petitioned the Texas Supreme Court to review the Court of Appeals decision. On March 9, 2007, the Supreme Court denied the Comptroller′s Petition for Review and on June 1, 2007, it denied the Comptroller′s motion for rehearing of that denial. The decision is now final in the Texas courts. The Comptroller is considering whether to seek review by the United States Supreme Court.