Trusts and Estates. Computation of taxable income and tax liability; distributable net income; allocation of tax among beneficiaries; current distributions; grantor and controlled trusts; powers to revoke or control trust; retained interest in trust income; administrative powers; beneficiary-controlled trusts; foreign trusts; charitable trusts; income in respect of decedents; procedure, compliance and IRS representation.
Corporate. Debt vs. equity; undistributed corporate income; dividends and non-liquidating distributions; stock redemptions; liquidations and stock distributions; divisions and reorganizations.
S Corporations. Eligibility; election of Subchapter S status; termination of Subchapter S status; tax effects of organization, capitalization and shareholder agreements; income, losses, deductions and credits; distributions; basis of stock and debt; compensation.
Real Estate. Commercial and residential real estate tax matters; purchase, ownership and sale of real estate; leasing; acquisition, disposition and improvement of leaseholds; operating expenses, taxes and depreciation; mortgage and equity financing; settlement or foreclosure; sales, exchanges and conversions; installment sales; like kind exchanges; involuntary conversions; real estate development.
Estate, Gift and GST. Estate tax; estates of non-resident aliens; gift tax; generation skipping transfer tax.
Partnerships and Partners. Acquisition of partnership interests; contributions of property and services; determining basis of a partner’s partnership interest; basis consequences of partnership liabilities; tax accounting for partnership operations; partners’ distributive shares; partner allocations; termination of partnership; sales, exchanges and transfers of partnership interests; partnership distributions; death or retirement of partner; Adjustments to partnership basis.
TAX CUTS AND JOBS ACT OF 2017
- Individual Income Tax Rates: Individual income tax rates and bracket amounts are modified for tax years 2018 through 2025. The new tax rates are 10%, 12%, 22%, 24%, 32%, 35% and 37% percent.
- Alternative Minimum Tax (AMT) exemption amounts are increased.
- Standard Deduction: Amounts are increased to $12,000 for single individuals and married filing separately, $18,000 for head of household, and $24,000 for married filing jointly.
- Personal and dependency exemptions are repealed.
- State and Local Tax Deductions: The itemized deduction by individuals for state, local and foreign property taxes, and state and local income taxes and general sales taxes is limited.
- Moving expense deduction is repealed.
- Medical Expenses: The Adjusted Gross Income (AGI) threshold to claim itemized deduction for unreimbursed medical expenses is reduced to 7.5% of AGI.
- Home Mortgage Interest: The itemized deduction for home mortgage interest is subject to new limitations. The deduction may only be claimed paid on acquisition debt, and the deduction on home equity debt is suspended. The maximum amount that may be treated as acquisition debt is reduced to $750,000 for debt incurred after 2017.
- Alimony: Both deduction for payments made, as well as the inclusion in income for payments received, are repealed -- for divorce or separation agreements executed or modified after 2018.
- Section 179 Expensing: The Section 179 dollar limitation is increased to $1 million and the investment limitation is increased to $2.5 million after 2017. The definition of eligible qualified real property is expanded. The exclusion for expensing for property used in connection with lodging facilities, such as residential rental property, has been eliminated.
- Excess Business Losses: Not allowed for non-corporate taxpayers after 2017, but are treated as a net operating loss (NOL) carryover. The passive activity loss rules apply before application of the excess business loss rules.
- Qualified Business Income Deduction: A pass-through deduction for non-corporate taxpayers, who may deduct up to 20% of qualified business income from a partnership, S corporation or sole proprietorship (including limited liability companies). A limitation on wages paid is phased-in when taxable income exceeds a threshold amount.
Trusts and Estates:
- The exemption for federal estate, gift and generation skipping transfer tax is doubled. The 2019 exemption of $11,400,000 per person ($22,800,000 for married couples). Annual present interest gift tax exclusion is $15,000 for 2019.
- Other provisions, including portability of any unused exemption of a deceased spouse, are maintained.
- Estate and Trust Income Tax Rates – The income tax rates and bracket amounts for estates and trusts are modified to 10%, 24%, 35% and 37%
- The graduated corporate rate structure is eliminated and corporate taxable income is taxed at a 21% flat rate.
- The Alternative Minimum Tax for corporations has been repealed..
- The percentage limitation on the deduction is increased to 60% of Adjusted Gross Income for cash donations to public charities.
- A donor making a contribution of $250 or more must provide contemporaneous written acknowledgement of the donee.