The New Section 199A Qualified Business Deduction: Opportunities and Stumbling Blocks for Your Business
The Tax Cut and Jobs Act (TCJA), passed on December 22, 2017, has added Section 199A to the Internal Revenue Code. The new provision allows a Qualified Business Income (QBI) deduction of up to 20% to owners of Pass-Through entities. Section 199A offers significant benefits to businesses since it can decrease the business income tax rate to 29.6% from 37%. It’s critical for companies to implement tax planning strategies that would effectively optimize the deduction.
In this LIVE Webcast, a panel of distinguished professionals and thought leaders will help firms understand the important aspects of Section 199A. They will provide an in-depth discussion of the benefits and challenges companies may face in taking advantage of this deduction. Speakers will also offer best practices in developing and implementing tax planning strategies in light of the new provision.
Key topics include:
- New Section 199A Qualified Business Deduction – An Overview
- Opportunities for Businesses
- Potential Risks and Pitfalls
- Managing Legal and Regulatory Challenges
- Best Tax Planning Strategies
Douglas W. Schwartz, Partner
- What considerations are there in drafting or updating our partnership/ LLC operating/ S corporation shareholder agreements in order to maximize the benefit of the 199A deduction to owners?
- What structuring options are there for a business with a component (e.g. consulting, health, legal) subject to the 199A phase-outs?
- What considerations are there for “reasonable compensation” for S corporations and “guaranteed payments” for LLCs/ partnerships?
Joshua R. Lake, Attorney
Seyfarth Shaw LLP
- Choice of entity considerations in light of Section 199A (this makes sense after the background and operation of the section has been discussed)
- Section 199A issues relating to real estate investment trusts (REITs)
- The Section 6662 accuracy-related penalty special rule for taxpayers claiming a Section 199A deduction.
Louis Vlahos, Partner
Farrell Fritz, P.C.
- How will it be applied to the income/gain realized on the sale of a business?
- Will it make a difference to otherwise qualifying pass-thru entities that also have foreign corporate subsidiaries?
- Should partnerships/LLCs forego paying guaranteed payments to those partners/members who render meaningful services?
- Will new businesses that are specified trade or businesses be treated differently than existing STBs in that the former may be able to split up various functions at inception while the IRS has intimidated that the latter will not be allowed to spin-off off such functions?
- You’ve decided to convert from one tax entity to another – what are the consequences?
Who Should Attend:
- Tax Executives and Directors
- Tax Attorneys
- Tax Preparers
- Tax Advisers
- Tax Compliance Officers
- Tax Accountants
- Business Executives
- Public and Private Companies
- Other Related/Interested Professionals and Organizations
Douglas Schwartz, in his 30-plus years of practice, has specialized in tax matters affecting personal, business, and other planning for nonprofits; public agencies; and clients in entertainment, art, retail and wholesale, professional services, oil and gas, healthcare, biomed, software, manufacturing, and real estate. He advises on international, federal, state, and local taxes (including, in California, income and franchise taxes; sales and use tax; Proposition 13; documentary transfer tax; and local business license taxes) and his practice encompasses tax planning; transactional work; audits and other tax controversies. He focuses on entrepreneurs who are forming and expanding businesses or interested in succession planning, and in that area is familiar with pass-through entities (sole proprietorships, S corporations, partnerships and LLCs) and their related tax issues (including, now, working through the Code section 199A qualified business income deduction).
Douglas Schwartz, in his 30-plus years of practice, has specialized in tax matters affecting personal, business, and other planning for …
Mr. Lake is an associate in Seyfarth Shaw LLP's Tax and Corporate practice groups, based in the firm’s New York office. He represents public and private clients on tax matters including partnerships and joint ventures, mergers and acquisitions, Section 1031 like-kind exchanges, REITs and real estate funds, restructurings, financings, and tax controversy. Prior to joining Seyfarth Shaw, Mr. Lake served as a law clerk to the Honorable Maurice B. Foley at the United States Tax Court.
Mr. Lake is an associate in Seyfarth Shaw LLP's Tax and Corporate practice groups, based in the firm’s New York …
Louis Vlahos is a partner and leads the firm’s tax practice. Mr. Vlahos has extensive experience in corporate, individual and partnership income taxation, and in estate and gift taxation, including tax planning, ruling requests, and tax controversy. He advises clients in connection with corporate operations and reorganizations; sales and acquisitions of businesses; corporate distributions, redemptions, liquidations and spin-offs; shareholder and buy-sell agreements; partnership organizations and transactions; real estate sales, exchanges and operations; executive and deferred compensation arrangements; estate and succession planning, including the transfer of business interests, and estate and gift tax audits; charitable giving; private foundation, tax exemption, not-for-profit restructuring, charitable gift acceptance, and excess benefit issues. He is a frequent contributor to the firm's Tax Law for the Closely-Held Business blog and also writes for the firm's New York Trusts & Estates Litigation blog.
Mr. Vlahos counsels not-for-profit corporations in connection with reorganizations. He has advised cultural institutions, hospitals and other non-profit organizations on their tax exempt status, corporate restructuring, the creation and operation of supporting organizations
(including fundraising entities), the structuring and acceptance of charitable gifts (including charitable trusts), compensation and other excess benefit issues, deferred compensation arrangements, and the taxation of unrelated business income.
In 2016, Mr. Vlahos was selected to serve as a member of the IRS Taxpayer Advocacy Panel (TAP). He will volunteer for three years.
Mr. Vlahos received his LL.M. in taxation from New York University in 1993, after he received his J.D. from Harvard Law School in 1987. He graduated with a B.A. magna cum laude, Phi Beta Kappa from Columbia College in 1984.
Mr. Vlahos is admitted to practice in New York State and in the U.S. Tax Court. He has
an AV Preeminent Martindale-Hubbell Peer Review Rating.
Louis Vlahos is a partner and leads the firm’s tax practice. Mr. Vlahos has extensive experience in corporate, individual and …
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Method of Presentation:
Experience in tax laws
NY Category of CLE Credit:
Areas of Professional Practice
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Seyfarth Shaw LLP provides legal counsel to client companies and legal teams of all sizes. With more than 850 attorneys in the U.S., London, Shanghai, Hong Kong, Melbourne and Sydney, Seyfarth offers a national and international platform to serve business and legal needs in litigation, employment, corporate, real estate and employee benefits.
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