Belan Wagner

Partnership Tax and Disguised Sales §704(c)(1)B

January 30, 2013

There are several disguised sale rules under Subchapter K. IRC Sections 707(a)(2)(B), 704(c)(1)(B), 737 and 751(b). Needless to say, Congress has created an extremely complicated set of rules, many of which are traps for the unwary. Two of these sections have a lot of subtleties built in and are probably violated often unintentionally. These are […]


Modifying an Option Agreement? It May Be Considered a New Agreement for Tax Purposes.

November 27, 2012

PAYMENTS RECEIVED UNDER OPTION AGREEMENT ARE NOT TAXED UNTIL EXERCISE OR LAPSE “An option is a contract which gives the Optionee a right to buy, sell, lease, or the like within a certain period of time.”[1] An option payment is not recognized as income at the time the payment is paid or received.[2] Instead, the […]


Satisfying Personal Injury Judgment with Settlement Proceeds from a Bad Faith Claim

July 19, 2012

Compensation for a victim’s injuries in a personal injury accident is typically made by an insurance company.  In California, insurance companies owe three duties to the person whom they have insured (the “policyholder”): (1) duty to defend a claim (or lawsuit) even if some or most of the lawsuit is not covered by the policy; […]


Home Mortgage Forgiveness in California and Related Income Tax Consequences

June 30, 2012

This article addresses the tax consequences arising from the relief or cancellation of debt (“Mortgage Relief”) arising from a foreclosure, short sale or deed in lieu of foreclosure (“PR Disposition”) or loan workout with respect to a debt (“Home Mortgage” ) secured by a taxpayer’s principal residence (“PR” ). Click here to download a PDF […]


Family Limited Partnerships as Estate Planning Tools: Pitfall Checklist

October 27, 2011

This issue of the WKBK&Y newsletter addresses Family Limited Partnerships as Estate Planning Tools. For a while, practitioners can still use family limited partnerships or limited liability companies as vehicles to accomplish estate planning goals (both referred to as “FLPs” herein). While the IRS keeps litigating the validity of FLPs under a variety of theories […]


Allocation of Debt Among Partners in Tiered Partnershipsc

September 25, 2011

This month’s newsletter focuses on allocation of debt among partners in tiered partnerships. Last month we reviewed the fundamentals of debt allocation under Section 752. This month we are going to look at a particular entity structure and discuss how the anti-abuse rules under Section 752 would apply. The structure is a limited partnership with […]