The Upper Tribunal (UT) has upheld the decision of the First‑tier Tribunal (FTT) regarding the application of the UK’s salaried member rules (the Rules) to certain members of BlueCrest Capital Management (UK) LLP (BlueCrest), an asset manager engaged in the provision of hedge fund management services. We previously reported on the FTT decision in June … Continue Reading
On July 11, 2023, the Senate Finance Committee released an open letter to the Digital Asset Community asking a variety of questions in connection with possible future legislation. Public comments must be emailed to the Senate Finance Committee staff at responses@finance.senate.gov by September 8, 2023. The questions are related to the following nine general areas. … Continue Reading
On July 26, 2023, Senate Finance Chairman Ron Wyden (D-OR) introduced the Ending Tax Breaks for Massive Sovereign Wealth Funds Act (the “bill”), which would deny the benefits of section 892 of the Internal Revenue Code[1] to sovereign wealth funds whose foreign government holds more than $100 billion of investable assets,[2] and either (i) is … Continue Reading
Introduction On May 3, 2023, the United States Tax Court held in ES NPA Holding, LLC v. Commissioner, T.C. Memo. 2023-55, that the taxpayer’s receipt of interests in a partnership in exchange for services rendered to the sole owner of the business before it became a partnership was for the benefit of the future partnership … Continue Reading
This blog post summarizes recent federal bills that have been introduced (but not yet passed), proposals by the Biden Administration, and guidance issued by the Internal Revenue Service with respect to the taxation of digital assets. Summary of the Guidance: The Responsible Financial Innovation Act (the “RFIA”) introduced in Congress by Senators Cynthia Lummis (R-WY) … Continue Reading
On March 9, 2023, the Biden Administration released the Fiscal Year 2024 Budget, and the “General Explanations of the Administration’s Fiscal Year 2024 Revenue Proposals,” which is commonly referred to as the “Green Book.” The Green Book summarizes the Administration’s tax proposals contained in the Budget. The Green Book is not proposed legislation, and each of … Continue Reading
Company share option plans (CSOP) and enterprise management incentives (EMI) are two statutory share option regimes that can be used to incentivise employees in a tax-efficient way. Broadly, where the relevant qualifying criteria have been met, both the CSOP and EMI schemes allow employees to acquire shares in their employer (or its group) for less … Continue Reading
On December 27, 2022, the Internal Revenue Service (“IRS”) and the U.S. Department of the Treasury (the “Treasury”) released Notice 2023-2 (the “Notice”), which provides guidance regarding the application of the 1% excise tax on corporate stock buybacks under recently enacted section 4501 (the “Tax”).[1] Taxpayers may rely on the Notice until proposed regulations are … Continue Reading
On December 28, 2022, the Internal Revenue Service (the “IRS”) and the Treasury Department released proposed regulations (the “Proposed Regulations”) under sections 892 and 897 of the Internal Revenue Code (the “Code”).[1] If finalized as proposed, the Proposed Regulations would prevent a non-U.S. person from investing through a wholly-owned U.S. corporation in order to cause … Continue Reading
Tax-exempt organizations, while not generally subject to tax, are subject to tax on their “unrelated business taxable income” (“UBTI”). One category of UBTI is debt-financed income; that is, a tax-exempt organization that borrows money directly or through a partnership and uses that money to make an investment is generally subject to tax on a portion … Continue Reading
As has been widely reported, a number of the Mini Budget proposals (summarised in our recent Tax Blog) have been scrapped. The new Chancellor of the Exchequer Jeremy Hunt announced these measures claiming that they are estimated to raise £32 billion in taxes every year. More tax rises and spending cuts are expected to be … Continue Reading
UK Mini Budget 2022 The Chancellor today unveiled the UK’s 2022 Growth Plan which has been described as being “the biggest package of tax cuts in generations”. We have summarised here the tax changes that we think will be of interest to our client base. UK corporation tax: the main corporation tax rate that was … Continue Reading
On August 16, 2022 President Biden signed the Inflation Reduction Act of 2022 (the “IRA”) into law. The IRA includes a 15% corporate alternative minimum tax, a 1% excise tax on stock buybacks and a two-year extension of the excess business loss limitation rules. The IRA also contains a number of energy tax provisions. I. … Continue Reading
On March 28, 2022, the Biden Administration proposed certain limited changes to the taxation of partnerships. In short, the Administration’s proposals would (i) prevent related partners in a partnership that has made a section 754 election from basis shifting to reduce taxable income;[1] and (ii) make two helpful changes to the partnership audit rules. I. Prevent … Continue Reading
On March 28, 2022, the Biden Administration proposed to tax “profits” or “carried” interests as ordinary income and impose self-employment tax on income and gains from these interests for certain partners in investment partnerships. The proposal is identical to the proposal made by the Administration last year. Under current law, a “carried” or “profits” interest in … Continue Reading
After a more than 26 year hiatus, on July 1, 2022, the Superfund chemical excise tax (the “Superfund Chemical Tax”) will again become effective. This excise tax, reinstated by the passage of the Infrastructure Investment and Jobs Act,[1] is imposed on manufacturers, producers, and importers of certain chemicals and chemical substances. As discussed below, the … Continue Reading
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