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The passage of the Tax Cuts and Jobs Act passed in 2017 overhauled several cornerstones of the Internal Revenue Code and introduced new tax law, including section 1400Z-1 and section 1400Z-2 which address the qualified opportunity zones (QOZs). The business community, specifically real estate investors, has viewed the QOZ as a possible turbocharged vehicle to stimulate economic development in low-income communities throughout the United States. However, the impact of the new code sections has been hampered by key questions on how to apply the provisions.

For companies doing business in multiple states, determining state tax responsibilities has always been a challenge. However, 2018 was a notably busy year. The Tax Cuts and Jobs Act (TCJA) brought federal legislation that left states needing to react quickly, and with tax reform 2.0 looming, the challenges are not over. In our state tax recap, we explore noteworthy changes and introduce information on state reactions to the TCJA, the Wayfair and sales tax nexus, increased state amnesty activity, and rate changes.

The Department of Treasury and Internal Revenue Service has issued initial proposed regulations and instructions for investments in qualified opportunity funds (“QOF”), a program designed to incentive the reallocation of capital to designated low-income census tracts. This long-anticipated guidance is expected to allow investors, business owners, real estate developers, and fund managers to be able to confidently seize the powerful tax deferral, reduction, and exclusion benefits provided by the QOF program.

The Tax Cuts and Jobs Act of 2017 created new incentives for investment into certain communities throughout the United States that have been designated as Qualified Opportunity Zones (QOZs) by the U.S. Treasury Department. Investors can take advantage of the statute’s unique opportunity for deferral and exclusion of capital gains taxes by investing in designated distressed communities or QOZs. In doing so, it is important to know the mechanics of investing in QOZs via Qualified Opportunity Funds, along with the risks that come with the opportunity.

One year has passed since significant tax law changes were enacted in December 2017. The overall impact of the Tax Cut and Jobs Act of 2017 (TCJA) on estate and tax planning for individuals and their families is close to what we expected—it’s been a mixed bag for taxpayers.

Individuals with disabilities and their families have many options to set aside funds without jeopardizing eligibility for means-tested government benefits, but most of the options require the person with a disability to lose control over his or her own money. With the Stephen J. Beck Achieving a Better Life Experience (ABLE) Act, people with disabilities can once again control some of their own money.

With the passage of the Tax Cuts and Jobs Act at the end of 2017, more family businesses are examining their corporate structure and considering the tax implications. Specifically, companies that are currently structured as “pass-through” entities (e.g., an S corporation, partnership, or LLC taxed as an S corporation or partnership) are examining the new-found benefits of converting to a C-Corp.

A GRAT is an estate freeze technique used in estate planning to minimize taxes on large financial gifts to family members. Under this technique, an irrevocable trust is created to which the grantor transfers income-producing or appreciating property in return for the right to receive a distribution of a fixed annuity amount from the trust (at least annually) for a specified term of years. GRATs have a few benefits, including the reduction of estate tax liability at death.

Following recent amendments to the tax code, both the applicable estate and gift tax exemption and the GST exemption were increased to $11,180,000. This nearly doubled the exemptions available in 2017. Taxpayers may consider making additional gifts to already existing dynasty trust in order to further supercharge the trust. They may also consider allocating GST exemption to an existing non-Dynasty Trust, to convert it into a Dynasty Trust that allows for a transferor to maximize the assets that are available to support future generations.

Investors are purchasing and selling virtual currencies (also known as “crypto currencies”) at a faster rate than ever before. Although these virtual currencies are not legal currency in the U.S., the IRS has been slowly issuing guidance on the income taxation and the manner in which individuals should report gains or losses from the sale or exchange of these currencies on their income tax returns.