Chancery Validates Tax Affecting in Fair Value Case
Owen v. Cannon, 2015 Del. Ch. LEXIS 165 (June 17, 2015) A joint fiduciary duty and statutory appraisal suit provided an opportunity for the Delaware Court of Chancery’s new chief, Chancellor Bouchard, to rule on the issue of tax affecting. In discussing the choices...
‘Loan Payments’ Can Be Taxable Corporate Distributions to Shareholders
When purported loan payments are recast as corporate distributions to shareholders, there can be negative tax consequences. The courts, in some cases, have ruled that withdrawals from two closely held corporations were constructive corporate distributions rather than...
Writing Off Worthless Stock Investments
Many of us have bought stock in a company that later failed over the years. While you may prefer to forget such an investment, don't forget to claim your rightful capital loss deduction on your tax return. But beware that figuring out when to claim a worthless stock...
Five Last-Minute Moves to Lower Your 2015 Tax Bill
Tax Day is right around the corner for Maine businesses and individuals, and the filing deadline to submit 2015 individual federal income tax returns is Monday, April 18, 2016, rather than the traditional April 15 date. Washington, D.C., will celebrate Emancipation...
Get More Bang for Your Buck with Tax-Favored Employee Benefits
The IRS recently laid out a few changes for 2016 to the tax laws that govern benefits, as laid out in the annual "Tax Guide to Fringe Benefits." The document features important clarifications, not just identifying which benefits are and aren't tax-exempt to employees,...
Key Ruling on Loss of Beer Franchise Contracts
Tri County Wholesale Distributors v. Labatt USA Operating Co. LLC, U.S. Dist. LEXIS 81914 (June 24, 2015) What is the best way to calculate the loss of well-known beer brands to a distributor whose franchise contract was lawfully terminated? This question, implicating...
Executive Compensation: What Are IRS Auditors Looking For?
The IRS must learn in-house terminology being used by the business when they begin auditing or examining, as well as how the business maintains their records. In the case of executive compensation, the IRS is especially interested in arrangements in which the company...
Vexing Valuations
When determining fair market value (FMV), valuing donations other than cash or equivalents is rarely easy. Typically, FMV is the highest value that can be obtained for a gift in kind between a seller and a buyer who are acting independently from each other in an...
Could Your Business Benefit from the Work Opportunity Tax Credit?
Employment statistics ended 2015 on a positive note, and many businesses are planning to hire new employees this year. In addition, roughly 242,000 new jobs were added in February and the unemployment rate fell to 4.9%, its lowest level in eight years. Several recent...
Adjusted Merger Price Superior to Other Valuation Methods
LongPath Capital, LLC v. Ramtron International Corp., 2015 Del. Ch. LEXIS 177 (June 30, 2015) The Delaware Court of Chancery was a hive of activity during summer 2015. In two months, the court issued a number of key valuation decisions—all long and deep. The following...