On June 10, 2020, in Nelson v. Commissioner, T.C. Memo 2020-81, the Tax Court ruled in favor of the IRS and against a taxpayer who attempted to use a defined value provision to value a transfer of assets. The taxpayer’s primary business was in heavy equipment relating to the oil and gas industry.  The taxpayer created a new holding company for the business equity, and transferred interests in the holding company to a trust in…

As an estate and trust attorney who has been practicing for over 20 years, I never lose sight of the difficulty we all face when losing a loved one.  Often when I meet a client, sometimes for the very first time, the initial words out of my mouth are  “I am so very truly sorry for your loss.”   I often enter someone’s life while they are grappling with everything from grief, to making funeral arrangements,…

The IRS recently issued Notice 2020-39, which offers relief to both qualified opportunity zone funds (“QOFs”) and persons seeking to invest in QOFs who are affected by the global COVID-19 pandemic. Investors in QOFs who want to defer capital gains and receive other QOF tax benefits are required to invest in a QOF within 180 days of the date of the sale that generated the gain or a later date applicable to partners, S Corporation…

The global coronavirus pandemic is of course a challenging time.  Many businesses have been hard hit and may not recover.  Unemployment has skyrocketed.  On the other hand, there are many businesses that have been only mildly affected to date. The conventional wisdom is that the economic pain will continue for some time.  Accordingly, it is an important time to review the terms of your business agreements, such as operating agreements or stockholders’ agreements (and frequently…

In order to remove any ambiguity occasioned by prior New Jersey Supreme Court Orders, extending the April 1 and May 1 annual tax appeal filing deadlines for regular and revaluation or reassessment district appeals to “30 days after the Governor lifts the State of Emergency” occasioned by the COVID-19 pandemic, respectively, Govenor Murphy has signed into law legislation fixing July 1, 2020 as the appeal deadline for this tax year.  Although this July 1 deadline…

As the Covid-19 pandemic has swept across the nation and around the world, those of us who practice in the areas of Wills, Trusts and Estates have noted an increase in calls from clients alarmed by what they are seeing on the news and in their own neighborhoods.  We typically field calls from clients interested in the more sophisticated documents found in the estate planner’s arsenal – Wills, Revocable Trusts, Generation Skipping Trusts, Lifetime Access…

In light of the coronavirus pandemic and significant economic downturn, this blog post briefly discusses questions that are commonly being asked right now regarding the income tax treatment of cancellation of indebtedness income (“COD”). The tax code provides that income from the cancellation of indebtedness is taxable, subject to a number of exceptions.  As an example, if a taxpayer has a loan of $100, and the lender forgives $20 of the debt so that the…