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Planning Using the Proposed Regulations under IRC §§ 199A and 643(f)


In August, the government issued proposed regulations under IRC §§ 199A (20% deduction for qualified business income from passthrough entities) and 643(f) (multiple trusts treated as one trust).  These regulations inform strategic and tactical planning for passthrough entities and trusts, of course containing some favorable and very unfavorable rules.

Learning Objectives

We will review some basics and then get into the proposed regulations. You will learn:

  • Wage and unadjusted basis immediately after acquisition (UBIA) limitations. See how basis step-up in different transfers affects UBIA and why tax-free formation of a business can (unfairly) reduce UBIA.  Consider whether workarounds really help.
  • Relevant passthrough entities (RPEs) and aggregation. The proposed regulations provide some relief but also do not allow favorable real estate aggregation from the passive loss rules.
  • Specified Service Trade or Business limits. Say good-bye to “crack and pack.”
  • Proposed regulations’ attack on trusts. The government listened to those who touted using multiple trusts to circumvent limitations of 2017 tax reform and seems to have decided that trusts are evil. Be aware of the government’s traps and consider whether you can avoid them.

The live presentation of this webinar was approved for 1.5 hour general CLE credit in California and Illinois and 1.8 hours of general CLE credit in Missouri. CLE credit is no longer available for this recording.

Steve Gorin

This webinar is a joint presentation by Thompson Coburn and The Missouri Chapter of the American Academy of Attorney-CPAs.

*Please note that this is a 90-minute presentation

Steve's 3rd quarter 2018 newsletter is available here.
ACTEC Comments on Proposed Regulations

Steve's current materials, Structuring Ownership of Privately-Owned Businesses: Tax and Estate Planning Implications, are available by emailing sgorin@thompsoncoburn.com

Originally Presented:
October 30, 2018