Per the IRS Education Provider Standards this course must be COMPLETED by 12/31/2025 to receive credits. NOTE: Go to My Professional Profile in your CCH CPELink account settings to ensure your name, and PTIN number; matches your PTIN card
Part 2 in a two-part series this 4 CPE hour course will discuss the tax advantages and disadvantages of each entity type. The course will also cover the tax treatment and potential pitfalls involved in forming each type of entity.
Choosing which type of entity to use to form and organize a new business can be challenging. One must consider and weigh costs and benefits today vs. the future, without knowing what the future will bring. Often, business concerns suggest one type of entity while tax concerns suggest another. These decisions are also affected by the Tax Cuts and Jobs Act of 2017 with the new 20% passthrough deduction and the lower rate for C corporations. While much of that remains uncertain, Jennifer Kowal will discuss the impact of the tax bill and how it needs to become part of the decision making process in 2022.
Publication Date: July 2022
Designed For
Tax practitioners at all levels who advise on the tax issues involved in forming business entities.
Topics Covered
- Tax Consequences and Considerations in Forming a C Corporation
- Tax Consequences of Section 351
- Tax Consequences and Considerations in Forming a Partnership or LLC Treated as Partnership
- Tax Consequences of Forming S Corporation
- Intersection of Capital Structure and Entity Classification with Regard to Tax Issues
- Consequences of Distributions
- Exit Strategy Options
Learning Objectives
- Describe the business advantages and disadvantages of using C corporations, S corporations, LLCs, partnerships, and sole proprietorships
- Identify the tax advantages and disadvantages of each entity type
- Describe tax consequences to forming various types of entities
- Differentiate IRC sections and how they apply
- Describe tax consequences of a Section 351 exchange
- Identify the formula for determining the aggregate basis in stock
- Recognize tax consequence of a Section 351 transaction
- Describe partner's basis in a partnership interest
- Describe inside basis
- Identify correct statements with respect to debt vs. equity determinations
- Identify the last step in the order of adjustments
Level
Intermediate
Instructional Method
Self-Study
NASBA Field of Study
Taxes (4 hours)
Program Prerequisites
Basic experience with choice of entity and tax issues involved in entity formations.
Completing CPE course Choice of Entity & Tax Issue Entity Formations: Part 1.
Advance Preparation
None
Instructor
Jennifer Kowal
Jennifer Kowal, JD, has been a tax professor and the director of the graduate tax program at Loyola Law School in Los Angeles since 2003. Loyola’s graduate tax program offers an LL.M. in Taxation for attorneys and a Master in Tax Law for non-lawyers. Professor Kowal teaches courses in advanced income taxation, income tax timing issues, corporate taxation, and tax research, among others. Prior to teaching at Loyola, Professor Kowal taught in the International Tax Program at Harvard Law School.
She also practiced law with the firms of Irell & Manella in Los Angeles and Ropes & Gray in Boston, advising clients on the taxation of various business transactions, including cross-border, partnership and corporate structures. Professor Kowal holds a BS in Accounting with distinction from the University of Kansas, and a JD from UCLA School of Law, where she was a member of the Order of the Coif.