Stock redemption costs: an analysis of conflicting judicial interpretations

Article Abstract:

Two inconsistent positions have developed due to judicial uncertainty regarding the deductibility of stock redemption expenses incurred during leveraged buyouts. IRC section 162(k) was enacted to limit deductions for greenmail expenses, but the Tax Court in Fort Howard Corp. v. Commissioner interpreted the statute to apply to all stock redemption expenses based on the primary purpose test. The US Court of Appeals reach an opposite conclusion in United States v. Kroy in finding that that origin of claim test was applicable.

Laws, regulations and rules, Expense deductions, Leveraged buyouts, Stock redemption

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IRS hopes to get employee tip reporting on "TRAC." (Tip Reporting Alternative Commitment)

Article Abstract:

IRS's Tip Reporting Alternative Commitment (TRAC) requires employers to educate employees on tip-reporting while limiting employers' tax liabilities. A TRAC agreement contains provisions covering reporting, recordkeeping, tax deposits, applications and revocation procedures. Under a TRAC agreement, restaurants' liabilities for social security and Medicare taxes are limited to employees' reported tips or tips discovered in audits.

Tipping

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