Proposed Treasury regulations published earlier this month contain limited relief for tax-exempt entities. If followed carefully, those regulations can enable tax-exempt entities (and any related for-profit corporations) to avoid the application of the Internal Revenue Code Section 4960 excise tax imposed on certain executive compensation.
The Tax Cuts and Jobs Act of 2018 included provisions affecting tax-exempt organizations with respect to the compensation paid by certain tax-exempt organizations to their senior officers.
This may worth something:
Congress Urged to Offer Canceled-Debt Tax Relief in Virus Bill
There's a push for lawmakers to help companies avoid taxes on canceled debts as they restructure—something congressional staff say they're considering—as the pandemic has thrown oil and gas, retail, restaurant, and other sectors into a tailspin.
"I personally think that Congress is going to need to take a look at this and possibly remedy this, and I certainly know that they are at least thinking about it," said Todd Maynes, a partner at Kirkland & Ellis and a member of the National Bankruptcy Conference. "For companies to survive, they're going to need to restructure their debt, and if you can't restructure your debt without triggering a big cash tax—then you sort of defeat the whole point."
IRS Issues Proposed Regulations on Excess Nonprofit Executive Compensation - Lexology
Section 4960 was added to the Code in 2017 as part of the Tax Cuts and Jobs Act.
An ATEO is defined in the Code as any organization which for the taxable year is exempt from taxation under section 501(a) of the Code (which includes a reference to section 501(c) organizations), is a farmers’ cooperative organization described in section 521(b)(1), has income excluded from taxation under section 115(1), or is a political organization described in section 527(e)(1).
“Remuneration” is defined as wages (as defined in Code section 3401(a)), except that such term does not include any designated Roth contribution and includes amounts required to be included in gross income under section 457(f) (deferred compensation). Remuneration is treated as paid when there is “no substantial risk of forfeiture” (generally, the risk of not receiving the payment for failure to provide future services) of the rights to such remuneration.
Taxation of Virtual Currency Mining Activities | McDermott Will & Emery - JDSupra
Proof of work (PoW)—one of the consensus methodologies through which blockchain (digital ledger) transactions can be validated—relies on data miners whose mining activities involve solving complex mathematical calculations. This article discusses key tax issues for miners and the IRS’s preliminary views involving taxation of Bitcoin PoW mining activities.
All blockchain (digital ledger) transactions require some type of consensus mechanism by which the transactions can be validated through distributed consensus. The two popular consensus methodologies are proof of work (PoW) and proof of stake (PoS). PoW relies on “miners” who conduct mining activities by solving complex mathematical calculations. Virtual currencies such as Bitcoin rely on PoW.
Quite a lot has been going on:
Athletes, Artists, and Audits: IRS Renews Focus on High-Wealth Individuals and Associated
The IRS has announced its intention to audit wealthy taxpayers and their associated business entities starting in mid-July. This LawFlash alerts sports owners, athletes, entertainers, and others in these industries to the impending issues and their unique exposure to becoming targets of these audits.
The US Internal Revenue Service (IRS) Global High Wealth Program announced via webcast on June 18 that it is preparing to review hundreds of high-income individuals’ tax returns between July 15–September 30. Each review is expected to include both individual tax returns as well as the returns of related business entities, with a focus on “pass-through” entities and partnerships.
IRS Issues Investment Company Pass-Through Write-Off Rules (3)
Shareholders of vehicles known as regulated investment companies can now get a better idea of whether they qualify for—and how to compute—a deduction for pass-through business owners.
The final rules adopt several parts of a proposed version. The write-off must be reduced by losses or deductions that are partially disallowed in the same tax year, for instance, as well as "conduit treatment" of certain real estate investment trust dividends earned by regulated investment companies.
IRS Clarifies CARES Act Distribution Rules
The CARES Act authorized eligible retirement plans to offer for a limited time a new type of distribution, a Coronavirus-Related Distribution (CRD), which is afforded special tax treatment. Only Qualified Individuals (QI) are eligible for a CRD. Significantly, the Notice expands the definition of a QI under Section 2202 of the CARES Act to include individuals whose:
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Spouses' or other household members (someone who shares the individual's principal residence) experience a COVID-19 related adverse financial consequence, including the closing or reducing of hours of a business they own and operate.
Proposed regs. explain disallowed transportation fringe benefits - Journal of Accountancy
In Notice 2018-99, the IRS provided interim rules regarding how to determine the amount of parking expenses that is nondeductible or treated as unrelated business taxable income (UBTI). (With the repeal of Sec. 512(a)(7), the UBTI rules are no longer relevant.
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Under the proposed regulations, as in Notice 2018-99, if the taxpayer pays a third party for its employee's QTF, the Sec. 274(a)(4) disallowance is generally calculated as the taxpayer's total annual cost of the QTF paid to the third party. With regard to QTF parking expenses, the proposed regulations provide that if the taxpayer owns or leases all or a portion of one or more parking facilities, the Sec.
Happening on Twitter
Kenyans can now breathe a sigh of relief after MPs on Tuesday voted to shoot down taxes proposed by Treasury on bas… https://t.co/rtp90KK0uF OliverMathenge (from Nairobi, Kenya) Wed Jun 24 09:43:22 +0000 2020
Media Statement: National Treasury and the Financial Intelligence Centre (FIC) invite public comments on proposed a… https://t.co/TUsF75By4P TreasuryRSA (from Pretoria) Tue Jun 23 09:29:12 +0000 2020
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