Category: Florida BAR article
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Florida Tax Procedure: A Primer
If you get audited by the Florida Department of Revenue, you may need to hire a tax attorney to help you navigate the process. The department has different offices that handle different aspects of the audit, such as auditing, technical assistance, and dispute resolution, as well as general counsel for formal protest or litigation. It’s…
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Two New Issues in Post-BAPCA 13 Cases
In Ch. 13 bankruptcy, certain tax debts, like trust fund recovery penalties and taxes where no return was filed, cannot be discharged. This means you still have to pay them even after bankruptcy. Other debts, like student loans and debts from fraud or embezzlement, also can’t be wiped out by Ch. 13 bankruptcy. So, bankruptcy…
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Getting Your Fair Share Back: Recovering Money Paid Pursuant to Unconstitutional Taxes and Fees
In short, the legal firm and attorney involved in the case don’t matter. The important thing is that the court sided with the plaintiff and awarded them damages for their injuries. In 1926, the Florida Supreme Court said that if you want to sue a county for something, you have to first follow certain rules…
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Proposed âTechnical Taxpayerâ Regulations Shut Down Guardian and Reverse Hybrid Structures
Simply put, foreign taxes are usually considered to be paid by the person or people who are legally responsible for paying those taxes under foreign law. The Treasury and IRS proposed some changes to these rules in 2006 to prevent taxpayers from using certain structures to inflate their foreign tax credits. This includes using a…
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Family Limited Partnerships: Are They Still Alive and Kicking?
About a year ago, a lawyer wrote an article about family limited partnerships in The Florida Bar Journal. Since then, the IRS has won two cases involving family limited partnerships. The article discusses these recent cases and provides tips on how to avoid making the same mistakes. It also talks about a survey that showed…
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Relationship Dissolution Planning Part II: Planning for Married Couples
When people are getting a divorce, they can plan ahead by creating a property settlement agreement. This agreement says how their property and debts will be divided after the divorce. They can include details about each asset they own and all the money they owe. This can help make the divorce process smoother and less…
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The Testamentary Charitable Lead Annuity Trust Revisited
A testamentary charitable lead annuity trust is a great way for wealthy clients to give to charity and still provide for their family. It pays money to charity for a certain period of time, and then the remaining assets go to the family. The estate gets a tax deduction for the money given to charity.…
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Achieving Capital Gains Treatment on Predevelopment Real Property Appreciation
Real estate values are going up, so property owners are choosing to develop their own projects instead of selling to someone else. When they sell the units, they have to pay taxes on the profit they make. But if they plan carefully, they can save money on taxes by treating the profit as a capital…
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Using Shared Appreciation Mortgages to Avoid FIRPTA
Foreign investors are putting a lot of money into U.S. real estate because the U.S. dollar is weak and interest rates are low. The main issue for foreign investors is a law called FIRPTA, which makes them pay U.S. taxes when they sell U.S. property. One way to avoid this is by using a shared…
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Documentary Stamp Tax: The Legislature Strikes Back
For a long time, people in Florida have been arguing about whether a tax should apply when someone sells a piece of land to a company they own. In 2005, the Florida Supreme Court said no, but then in 2009 the state changed the law to make it apply in some cases. This caused problems…
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Tax Dodgers Beware: New Foreign Account Tax Compliance Legislation
Recently, the U.S. government has been putting pressure on foreign banks to give them information about American account holders. They want to make sure people are paying the right amount of taxes. A new law called FATCA was introduced to help stop tax evasion and make sure people are being honest about their money in…
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Beyond the Imminent Sale Doctrine: Valuing Assets with Imbedded Tax Consequences
In the past, Florida courts used to follow a rule that didn’t take into account potential taxes when dividing assets in a divorce. But now, they have changed their approach to make sure that all tax consequences are considered to make things fair for both parties. This change was influenced by federal courts’ decisions on…
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Section 2053 Final Regulations: Continued Uncertainty?
The Treasury Department issued new regulations for deducting expenses and debts when someone dies. The rules say that you can only deduct these expenses if they have been actually paid. If you owe money to someone, you have to pay it before filing the tax return. There are a few exceptions to this rule, like…
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The IRS Will Absolutely, Positively Not Pay Your Attorneys’ Fees (Or Will They?)
Yes, the IRS can be required to pay a taxpayer’s attorney fees and costs in certain situations, as outlined in section 7430 of the Internal Revenue Code. This can apply to administrative proceedings and court cases, but there are specific requirements that must be met. The article also discusses recent proposed regulations from the IRS…
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Asset Purchase Stockholders’ Agreements
A stockholders’ agreement is like a contract for people who own a company together. It helps to keep things fair and protect everyone’s interests. It can say things like who can buy or sell the company’s stock, how important decisions are made, and how to keep business secrets safe. It’s a good idea to have…
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Asset Location: Why Attorneys Should Bridge the Perceived Investment Gap
Hayley, a widow, is meeting with her attorney to get advice on her estate planning. The attorney suggests that she should fund her revocable trust with her $2.5 million investment account and keep her IRA, other assets, and her home in her individual name. The attorney also recommends that she review her beneficiary designation for…
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Tax and Asset Protection Benefits Afforded Florida Domiciliaries
The main reason people move to Florida is because of its warm weather. But Florida also has good tax laws and protections for your assets. If you want these benefits, you may need to take some steps to make sure you qualify. If you own property in another state or spend a lot of time…
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Can an Investment Become a Theft for Tax Purposes?
Bernie Madoff, like Charles Ponzi before him, ran a huge investment scam that cost many people billions of dollars. The IRS has a special rule for people who lost money in Ponzi schemes, allowing them to treat their losses as theft for tax purposes. This means they can deduct the losses from their taxes, but…
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Sales Tax on Commercial Leases of Real Property: A Refresher on the Issues Involving Florida Sales Tax and Commercial Leases
In Florida, sales tax must be paid on certain charges in commercial lease transactions. This includes base rent, additional rent, and common area maintenance charges. The state imposes a six percent sales tax on the total rent, and counties may add an additional tax on top of that. The Department of Revenue has specific rules…
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Higgs v. Warrick: Lessees of 99-year Leases Qualify for Homestead and Save Our Homes Tax Exemption Purposes
The court made a decision that the property appraiser in Monroe County couldn’t revalue William L. Warrick’s home after his trust ended. This is good news for planners who help clients with similar trusts and are worried about losing tax benefits when the trust ends. A 98-year lease is a technique that allows someone to…
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IRS Takes Controversial Approach to Characterization of Separately Stated Item of Subpart F Income
The IRS recently refused to give a ruling on whether a U.S. shareholder of a controlled foreign corporation can make a retroactive election. The issue was whether a U.S. shareholder that owns a CFC through a 100 percent owned S corporation has an amount included in their income. The IRS says they don’t have the…
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Creditor’s Rights Under Private Annuities and Grantor-retained Annuity Trusts in Florida
This article talks about whether annuity contracts are protected from creditors in Florida. The authors argue that even private annuity contracts should be protected under the law, based on their analysis of the statute and previous court decisions. They believe that if the legislature didn’t specifically exclude private annuities from the law, then they should…
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Roth IRA Conversions: Benefits and Planning Opportunities
The main point is that contributing to a Roth IRA allows your money to grow tax-free, unlike a traditional IRA where you have to pay taxes when you take the money out. Converting to a Roth IRA can be a good idea for some people because it means you won’t have to pay taxes on…
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Untangling Taxes from Personal Injury Damages
In personal injury cases, the amount of money awarded for lost future earning capacity can be affected by whether the jury considers the plaintiff’s potential earnings before or after taxes. This decision can significantly impact the final award. If the jury uses gross earnings (before taxes), the award will be higher than if they use…