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Contribution of S Corporation Stock to Disregarded Limited Partnership Did Not Terminate S Election
An S corporation’s sole shareholder transferred all of his stock shares to two newly formed, wholly owned disregarded LLCs. The LLCs then transferred the stock shares to a newly formed state limited partnership that the ...
Guarantee of S Corporation Debt Did Not Increase Basis
A short analysis of the Tax Court case William H. Maloof, TCM 2005-75. Maloof guaranteed a $4 million loan for an S corporation which the company eventually defaulted on. Maloof argued that his loan guarantee should allow ...
Agricultural, Public Interest, and Burial Organizations May Be Exempt from the Franchise Tax
Many nonprofit organizations may qualify for a franchise tax exemption, but must first submit a written application to the Texas Comptroller of Public Accounts. These organizations are still responsible for paying other ...
Aircraft Sales May Be Exempt from the Sales and Use Tax
Aircraft is tangible personal property and subject to Texas’ sales and use tax. However, the sale or lease of aircraft may qualify for one of several exemptions from the sales and use tax. This Practice Insight notes ...
Directors and Officers May Be Liable for Corporate Debts in the Event of Forfeiture of Corporate Privileges for Tax Violations
Upon the occurrence of several specified tax violation events, the Texas Comptroller of Public Accounts may forfeit the corporate privileges of a corporation. Directors and officers of the corporation have personal liability ...
Understanding the Texas Comptroller’s Discretion to Redetermine the Tax on a Sales or Use Tax Report
The Texas Comptroller has the authority to redetermine the amount of tax owed by a taxpayer if he is not satisfied with the amount of tax paid or with a sales or use tax report.
The Seller and Purchaser Are Both Liable for Uncollected Sales Tax
Liability for payment of uncollected sales tax falls on both Texas sellers and purchasers.
Religious Organizations May Be Exempt from the Franchise Tax
Religious organizations and many other kinds of organizations are allowed an exemption from the Texas franchise tax. To obtain the franchise tax exemption, organizations must submit an application to the Texas Comptroller ...
The New Texas Margin Tax—The Margin Tax Implements Combined Group Reporting
The Texas Margin Tax requires affiliated entities engaged in a unitary business to file a combined group report. The Texas Margin Tax also increases the entity types which are subject to tax.
Improper Documentation and Maintenance of Files Can Lead to the Loss of Exemptions
Items purchased for resale are not taxable in Texas, however, a purchases must provide a resale certificate to a purchaser in order to qualify for an exemption from sales and use tax. Sellers should keep these certificates ...