Real estate can offer significant tax benefits. This is largely due to depreciation deductions which allow taxpayers to deduct their cost of investment in the property. Given the tax benefits, Congress has put in place some nuanced rules that allow some real estate owners to get immediate benefits and that deny or defer benefits to……
TX-LW Blogs
Settling Debts in an Asset Purchase: Immediate Deduction or Capitalized Cost?
You own two businesses. They work in similar spaces, but are distinct businesses. One of them has financial troubles and gets behind on its bills. You decide to have the other business acquire the assets of the failing business. You start thinking about taxes. You think ahead when you go to do the tax returns……
When Does a Promissory Note Create Basis in Controlled Company Stock?
Business owners have choices in how to fund their corporations. Should they contribute cash? Property? Perhaps a promissory note? There may be some benefit of using a promissory note. You get stock in your company without immediately parting with cash or other assets. The promissory note sits on the company’s books as a receivable, and……
COVID-19 Extended Tax Deadlines Longer Than Many Realized
Taxpayers have various tax filing deadlines throughout the year. Missing one can trigger penalties, interest charges, and collection actions. When there is a major disaster, the IRS typically grants short extensions to give affected taxpayers breathing room. During the COVID-19 pandemic, the IRS issued notices extending various tax deadlines by a few months. The agency……
Can a Guilty Plea Can Disqualify You as Executor in Texas Probate Administration?
Family relationships can fray after someone dies. Money and property have a way of bringing out the worst in people. Sometimes the conflict escalates beyond angry words at the funeral or tense meetings with the lawyer. What happens when the person named as executor in the will has committed violence against another family member who…
Installment Agreements Can Extend the IRS Collection Deadline
The IRS has ten years to collect unpaid taxes after assessment. But that deadline isn’t always final. Those with unpaid tax debts often seek payment plans to be able to pay their tax liabilities over time. When a taxpayer requests or enters into an IRS installment agreement, the clock on the collection statute stops running.……
Tax Planning for Net Operating Loss Carryback Elections
Congress has used Section 172 for net operating losses to stimulate the U.S. economy. It has done this by allowing certain losses to be carried back, thereby generating cash refunds to the taxpayer. This puts cash into the hands of taxpayers who are suffering losses. One only has to look at the history of changes……
Who Qualifies as a “Designer” for Section 179D Energy Tax Deductions?
Contractors regularly upgrade HVAC systems and lighting in commercial buildings to improve energy efficiency. These projects can be expensive. When the building owner is a government entity, the tax code allows contractors to claim an immediate tax deduction for the cost of energy-efficient improvements under Section 179D. But not every contractor who touches the building……
A Common Probate Challenge: Voiding Real Estate Deeds Based on Mental Incapacity
A family member signs over her home to a grandchild. Weeks later, she’s declared legally incapacitated. The family questions whether she truly understood what she was doing when she signed. But here’s the challenge: nobody performed a mental evaluation on the exact day she signed the deed. Does that mean the deed stands? This scenario…