Law Articles

Estate Planning for Retirement Benefits

The Internal Revenue Service recently issued proposed regulations pertaining to required minimum distributions from qualified retirement plans, individual retirement accounts (IRAs), certain nonqualified retirement plans, section 403(b) annuities, custodial accounts and retirement income accounts. Given the breadth of the new proposed regulations and the potential impact to many of our clients, we have prepared this (more…)

S Corporation Salary

Recently, the IRS successfully challenged a common tax strategy that is often used by owners of S corporations. An S corporation, as many of you may know, is a corporation operating under state law that elects to be taxed as an S corporation under the Internal Revenue Code. In general, the corporation’s income is taxed (more…)

2010 Tax Relief Act

As most people are aware, President Obama recently signed into law the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the “2010 Tax Relief Act”), extending, for two years, the so-called Bush Tax Cuts. Individual Tax Rates The 2010 Tax Relief Act extends all individual rates at 10, 15, 25, 28, 33 (more…)

Using IRAs for Charitable Gifting

The Pension Protection Act of 2006, enacted into law in 2006, provides a potentially valuable tax planning opportunity for individuals over the age of 70 ½. In order to take advantage of the planning opportunity, action must be taken before the end of 2007. Prior to the new law, if an individual wanted to make (more…)

Nonqualified Deferred Compensation

Deferred compensation arrangements have been used by businesses to allow its employees and/or owners to defer the taxable income payable on account of their wages or other compensation. The deferral of income is beneficial because the tax liability is also deferred. Moreover, if the employee is in a lower tax bracket when the deferred amount (more…)

Deferring Capital Gains with a Like-Kind Exchange

Recently, a client consulted with our firm to represent him in the sale of his commercial rental property. Considering the property’s appreciation and the tax depreciation that the client had taken over the years, the sale of the real estate was going to result in a $500,000 capital gain to the client. In discussing the (more…)

Charitable Split Dollar

Recently, there has been some publicity of a type of charitable gift, called charitable split dollar, that generated a significant income and estate tax deductions and resulted, in essence, with a deduction for insurance premiums. Basically, under a so-called charitable split dollar arrangement, a donor would contribute an appreciated asset to a charitable organization which (more…)

New Massachusetts Homestead Law

On December 16, 2010, Governor Patrick signed into law important modifications to the Massachusetts homestead law. Under the new homestead law, every homeowner is automatically entitled to a homestead exemption of $125,000.00. The exemption, which generally protects a homeowner’s equity in his or her home from claims of creditors, can be increased to $500,000.00 by (more…)

Can a Vacation Home be Exchanged in a Like Kind Exchange?

If a transaction is properly structured, the sale and purchase of vacation homes may qualify for like kind exchange treatment. In one recent Tax Court case, however, the taxpayers did not properly structure their vacation property exchange and were denied like kind exchange treatment. In the case of Moore v. Commission, T.C. Memo. 2007-134 (5/30/07), (more…)

Offers to Purchase Real Estate in Massachusetts: Buyers and Sellers Beware

The process of purchasing or selling real estate, whether a residential or commercial property, consists of many steps, all of which require careful thought and consideration by both parties to the transaction. One of the first steps in the process of purchasing and selling real property, the significance of which many underestimate, is the execution (more…)