PLANNING DEFERRED COMPENSATION FOR LLC MEMBERS AND EMPLOYEES

By , August 26, 2016 2:49 pm

It may be helpful for some of your LLC formation clients if you can give them at least general guidance about structuring deferred compensation for employees of their LLC and for members if the LLCs are taxable as C or S corporations.  The post in the link below will help to equip you to provide this guidance.

Here’s the link:

http://www.taxlawforchb.com/2016/07/proposed-changes-to-transaction-related-409a-compliance/?utm_source=Tax+Law+for+the+Closely-Held+Business&utm_campaign=fff9fd7877-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_4d5d267118-fff9fd7877-73367009

EARLY ELECTIONS UNDER NEW PARTNERSHIP AUDIT RULES

By , August 25, 2016 2:41 pm

The new Bipartisan Budget Act partnership audit rules are a major development in LLC tax and will affect every existing and new partnership agreement  for general and limited partnerships and operating agreement for multi-member LLCs taxable as partnerships.  The Treasury Department has just issued a new temporary reg and a proposed reg re early elections under these regs.  See T.D. 97800 and REG-105005-16.  Every LLC lawyer should have at least a basic understanding of these regulations.

NEW BLOG POST BY LOU VLAHOS ABOUT THE NEW PARTNERSHIP AUDIT REGS

By , August 24, 2016 3:00 pm

Every LLC lawyer should have, at the very least, a solid basic understanding of the TEFRA partnership audit rules, which will apply until the end of 2017; the new Bipartisan Budget Act rules, which will apply thereafter; and how to deal with these rules in the operating agreements of multi-member LLCs taxable as partnerships.  Below is a link to a very practical new blog post by Lou Vlahos about the new regs.

http://www.taxlawforchb.com/2016/08/more-guidance-on-partnership-audits/

NEW AMENDMENTS TO DELAWARE GLL AND LLC ACT

By , August 23, 2016 3:53 pm

The post under the following link provides a good summary of the above amendments:

http://www.lexology.com/library/detail.aspx?g=00ebf0dc-952e-4884-a39f-4e7de098802a&l=7S4DNFC

“TIE-BREAKER” CASE

By , August 22, 2016 5:23 pm

Tie-breaker provisions in LLC operating agreements can serve many valuable functions for your LLC formation clients—and can also, for some LLC members, have shocking results, as shown by Peter Mahler in his discussion of a recent New York case under the link below.  The case involves a New York corporation, but it is equally applicable to LLCs.

Here’s the link:

http://www.nybusinessdivorce.com/2016/07/articles/buyout/tie-breaker-shareholders-agreement-defeats-deadlock-dissolution-petition/

BLOG POST ABOUT WHO MAY SIGN FEDERAL TAX RETURN OF LLC MANAGED BY ANOTHER LLC

By , August 19, 2016 4:19 pm

I’ve just stumbled across the blog post under the link below.  The post was published in September 2015.  I have not posted about this post previously, and I generally post only about current developments.  However, I’m covering it in this post because it’s significant for at least a significant number of LLCs.  It addresses the issue of who, for federal tax purposes, may sign the federal tax return of an LLC managed by another LLC.

Here’s the link:  https://www.hklaw.com/TaxBlog/IRS-Clarifies-Who-May-Sign-LLCs-Return-09-22-2015/

BLOG POST ABOUT PROTECTING INTELLECTUAL PROPERTY

By , August 18, 2016 5:31 pm

The key asset of many clients who form their businesses as LLCs is their intellectual property.  The post under the link below provides an excellent overview of how to choose the best way to protect this intellectual property.

Here’s the link:  http://www.jdsupra.com/legalnews/selecting-the-right-intellectual-14098/

NON-COMPETES

By , August 16, 2016 1:30 pm

When you’re forming an LLC for a client, it will often be necessary to ask the prospective LLC members whether any of them are subject to non-competition agreements or other “restrictive covenants” with employers that could interfere with their LLC memberships.  This means you have to be aware of current developments relating to these restrictive covenants.  The blog post under the link below makes note of several such developments.

Here is the link:   http://www.jdsupra.com/legalnews/recent-developments-again-call-for-20933/

REVIEW OF NH TAX LEGISLATION FOR 2016

By , August 15, 2016 6:16 pm

For those of you who follow New Hampshire taxation, the New Hampshire Department of Revenue Administration document under the following link will provide a useful summary of NH 2016 tax changes:

http://revenue.nh.gov/tirs/technical-releases.htm

BERMUDA LLCS

By , August 11, 2016 2:23 pm

It can sometimes be useful to LLC formation clients to form “off-shore” (i.e., non-U.S.) LLCs.  This may be the case, for example, if a majority of the members are not U.S. citizens or U.S. residents and you want to protect them from U.S. taxes.  As I stated in a post to this group a few months ago, the Cayman Islands enacted a law in late 2015 authorizing the formation of Cayman Islands LLCs, and a few weeks ago, the Cayman Islands adopted implementing regulations for the formation of Cayman Islands LLCs; and a few days ago, I formed a Cayman Islands LLC for a group of numerous clients, most of whom were non-U.S. citizens residing outside the U.S.

Now, as indicated in the link below, Bermuda has also enacted an LLC act.  And both the Cayman Islands and Bermuda LLC acts are closely modeled on the Delaware Limited Liability Company Act.  So, if you’re planning to form a foreign LLC for your LLC formation clients, you’ll have to compare the two acts before you proceed.  If I’m faced with that challenge, I’ll send this group a post as to how I’ve made my comparison between the Cayman Islands and Bermuda LLCs.

Here’s the relevant link:  http://www.mondaq.com/x/514338/Corporate+Commercial+Law/Limited+Liability+Company+Act+passed+In+Bermuda+Senate