April 9, 2020: The Treasury Department and the Internal Revenue Service issued Notice 2020-23, which amplified Notice 2020-18 and Notice 2020-20 and modified Rev. Proc. 2014-42 with respect to calendar year 2020, and provided additional relief, postponing certain time-sensitive actions. Generally, Notice 2020-23 provides that any person who has a federal tax return or other form filing obligation specified in the Notice that is due to be performed (originally or pursuant ... Keep Reading »
Cost-Sharing Regulations Revived By Ninth Circuit
The Ninth Circuit Court of Appeals reversed the Tax Court in Altera Corp. in the latest chapter of the dispute over the validity of cost-sharing regulations. The decision, issued on July 24, revives certain regulatory provisions previously invalidated by the Tax Court. (See Altera Corp. v. Commissioner, Dkt. Nos. 16-70597 & 16-70497 (9th Cir. 2018) rev’g 145 T.C. 91 (2015)). These regulations govern the allocation of stock-based compensation costs to a foreign ... Keep Reading »
The Hidden Cost of Settling a Qui Tam Claim
Historically, taxpayers who made settlement payments to the government or relator under False Claims Act actions could offset those often considerable costs by deducting all or part of the payment for federal income tax purposes. But the Tax Cuts and Jobs Act, enacted in December, dramatically shifted the tax treatment of such payments, resulting in the potential loss of valuable tax benefits. Now more than ever, companies must carefully consider the tax treatment of ... Keep Reading »
Tax Reform: Insurance Company Provisions
Recent tax legislation, informally known as the Tax Cuts and Jobs Act (the “Act”) contains several changes that affect the insurance industry. A centerpiece of the Act lowers the corporate income tax rate to 21 percent, which generally applies to all corporations. Other reforms not specific to the insurance industry will also significantly affect many insurance companies. These include eliminating the corporate alternative minimum tax, a reduction of the general ... Keep Reading »
Virtual Currency Tax Consequences
A growing number of startups are offering virtual currencies to investors through initial coin offerings (ICOs) as a way to raise capital, often with little or no awareness of the tax consequences of their actions. Many startups sell specially created cryptocurrencies to initial project backers who expect the currency to increase in value if the startup succeeds. These cryptocurrencies, or tokens, are initially issued in fixed, limited amounts which generally can be used ... Keep Reading »