It's Been a Busy Month of Webinars
And more are on the way! Realizing how busy our practitioners are, we've been attempting to offer practical, accessible webinars offering CPE and CLE credit over the lunch hour. We've had a great response and want to thank all of you who have been involved. The tax webinars will all be available for replay on TaxPlace shortly. The AgLaw webinars will also be available to all on the CALT website. June is also full of webinar CPE offerings. We'd love to have to you join us!
- Getting Clients Right with Tax Filings – June 2
- Tax Basics for an LLC - June 3
- Preparing Form 1040X - June 4
- Farm Depreciation Issues - June 9
- Confronting a Tax Lien - June 23
- Payment Options for Your Client - June 24
- Business Use of Home: Historical vs the New Safe Harbor Method - June 25
- Disaster: Assisting Your Client with Recovery - June 30
To register for a webinar, click here. Also, don't forget the free Scoop Kristy offers every other Wednesday morning for tax practitioners. Tune in for the latest in what's happening in the world of tax filings.
From the AgDocket
We seek to keep you updated on the latest happenings in agricultural law. Follow the AgDocket to keep up with recent activity.
Estate and Succession Planning With S Corporations
Estate, business and succession planning changed dramatically with the enactment of the American Taxpayer Relief Act (ATRA) in early 2013. Now, with a federal estate tax exemption set at $5.43 million for death in 2015 and a “coupled” gift tax exemption of the same amount, very few estates will be subject to the federal estate tax. That doesn’t mean that state death taxes can be ignored. In the states that impose taxes at death, the exemption levels are typically much lower than the federal exemption level. Also, farmland values have increased significantly in recent years, virtually matching (in percentage terms) the percentage increase in the federal estate tax exemption. So, for larger agricultural estates, the increase in the exemption is basically worth about the same as it was several years ago.
The goal of most individuals and families is to minimize the impact of the federal estate tax at death. But, with the exemption at $5.43 million for 2015 deaths and “portability” of the amount of any unused exclusion at the death of the first spouse for use by the surviving spouse, the estate tax is not an issue except for very few estates. That means that, for most families, it is an acceptable strategy to cause assets to be included in the decedent’s estate at death to get a basis “step-up.” Thus, succession plans that have been in existence for a while should be re-examined.
Buy-out agreement. For family businesses involving an S corporation, some sort of shareholder buy-out agreement is a practical necessity. Over time, however, if that agreement is not revisited and modified, the value stated may no longer reflect reality. In fact, it may have been established when the estate tax was projected to be more of a potential burden than it is now. The ATRA changes in the federal estate tax may be one reason, by themselves, to take another look at that agreement.
Consider Not Making Gifts of Business Interests. Historically, transition planning has, at least in part, involved the parents’ generation gifting business interests to the next generation of the family interested in operating the business. However, there might be a better option to consider. It may be a more beneficial strategy to have the next generation of operators start their own businesses and ultimately blend the parents’ business into that of the next generation. Not only does this approach eliminate potential legal liabilities that might be associated with the parents’ business, it also avoids gift tax complications. Read more.
EPA and Army Corps Unveil Final Clean Water Rule
The EPA and Army Corps unveiled their long-awaited final Clean Water Rule on May 27, 2015. The proposed rule had been pending for more than a year. The final rule, which faced severe opposition in its proposed form, retains most of its original provisions. It does, however, incorporate a number of changes in response to the more than one million comments received.
The final rule identifies eight categories of “jurisdictional waters.” These are waters over which EPA and the Army Corps could exercise Clean Water Act jurisdiction. These categories include: (1)Traditional navigable waters, (2) Interstate waters, (3) Territorial seas, (4) Impoundments of jurisdictional waters, (5) Tributaries, (6) Adjacent Waters, (7) Specific Waters Subject to Case Specific Significant Nexus Analysis, and (8) Other Waters Subject to Case-Specific Significant Nexus Determinations.
Traditional Navigable Waters, Interstate Waters, Territorial Seas, and Impoundments of Jurisdictional Waters
The final rule does not alter the agencies’ treatment of traditional navigable waters, interstate waters, territorial seas, or impoundments of jurisdictional waters. Coverage of these waters has not changed from that announced in the proposed rule. These are the traditional waters widely agreed to be protected by the Clean Water Act
The “tributaries” category was among the most controversial of the proposed rule’s categories of jurisdictional waters. For the first time the agencies sought to define the word “tributary,” and the proposed definition met with great opposition. The proposed rule broadly defined tributaries to include natural or man-made waters, wetlands, lakes, ponds, canals, streams, and ditches if they contribute flow directly or indirectly to interstate waters. The proposed rule had no requirement that the waterways continuously exist or have any nexus to traditional “waters of the United States,” as has traditionally been required. Read more.
Donate to CALT
As you know, our work at the Center is dependent on the fees generated by seminar registrations and gifts. If you would like to donate to further the Center's efforts, please contact our Program Administrator, Tiffany Kayser at email@example.com or (515) 294-5217. You can also give online with a credit card. We thank you for your generous support.
Summer Seminar Spaces Still Available
If you'd like to meet your CLE/CPE requirements and have a wonderful getaway at the same time, we have some great summer seminar opportunities for you! We've assembled experts from around the country to offer two days of immersive training in agricultural income tax and business and estate planning. We'd love to have you join us. We'll be in Findley Lake, New York, on June 11-12, Spearfish, South Dakota, on June 18-19, and Lake Tahoe, California, on July 30-31. We are also offering a live webinar option for the Lake Tahoe Seminar for those of you unable to travel.
Recent Case Review
Following is a sample of recent legal cases summarized on our website. See the complete collection here.
The Center for Agricultural Law and Taxation does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. The Center's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.