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Tax Issues and Planning to Consider Before Year-End 2020

November 2020 This annual newsletter briefly highlights certain tax issues and planning that hedge fund managers (and other high-net-worth individuals) should consider (or reconsider) before year-end. Although year-end tax planning is always important, the potential increase in tax rates in 2021 makes it even more important this year-end. The election may be over, but uncertainty…

Client Alerts | November 10, 2020 | Business Advice and Planning | High Net Worth Individual Planning | Hedge Funds | Private Equity Funds | Planning for Fund Managers

The Impact on Fund Investors and Fund Managers of the New Regulations on the Business Interest Expense Limitation under Section 163(j)

The Tax Cuts and Jobs Act (the “TCJA”), enacted on December 22, 2017, made significant changes to Section 163(j) of the Internal Revenue Code of 1986, as amended (the “Code”), regarding the deductibility of business interest expense. For tax years 2018 through 2025, Section 163(j) of the Code generally limits a taxpayer’s business interest expense…

Client Alerts | August 25, 2020 | Business Advice and Planning

A Tax Planning “Hat Trick” for Funds Acquiring Portfolio Company Debt

As a result of the COVID-19 pandemic, many companies are having difficulty meeting payment obligations on their outstanding debt. However, thanks to a combination of the U.S.-Irish income tax treaty and Section 108 of the Internal Revenue Code of 1986, as amended (the “Code”), private equity funds (and other funds) may be able to find…

Client Alerts | July 9, 2020 | Business Advice and Planning | Private Equity Funds

More Global High-Wealth Audits Expected Soon

The Commissioner of the IRS Large Business and International Division recently announced that the Global High Wealth Industry Group of the IRS will initiate several hundred audits of high-wealth individuals. The audits are expected to commence beginning July 15 when the suspension of certain examination and collection functions of the IRS is lifted. A representative…

Client Alerts | June 22, 2020 | Business Advice and Planning | High Net Worth Individual Planning

Unexpected Tax Consequences of Commercial Lease Modifications

In a prior Kleinberg Kaplan client alert, we noted that COVID-19 related economic disruptions have caused both landlords and tenants to consider restructuring their commercial lease arrangements. Tenants that enter into discussions with landlords seeking rent relief may be successful. However, landlords and tenants should be aware that they could run into unexpected tax consequences in…

Client Alerts | April 30, 2020 | Business Advice and Planning | Leasing

Summary of Key Tax Provisions for Individuals and Businesses under the CARES Act

The Coronavirus Aid, Relief, and Economic Security Act ( the “CARES Act”) was signed into law on Friday, March 27, 2020.  The CARES Act contains a number of tax provisions which modify the Internal Revenue Code of 1986, as amended (the “Code”).  The provisions are designed to provide relief and assistance to both individuals and…

Client Alerts | March 30, 2020 | Business Advice and Planning | High Net Worth Individual Planning