Looking Ahead: What to Expect in 2023
It has been an interesting year in the tax world. The journey of the new tax law under the Inflation Reduction Act of 2022, signed into law by President Biden on August 16, 2022 (the “Act,”) resulted in changes significantly smaller in scope and effect than many thought would appear. Most notably, the Act does not include many changes originally put forth in the international tax arena such as changes to the laws on the now famed monikers of GILTI (global intangible low taxed income) and BEAT (base erosion and anti-abuse tax.) Some notable changes in the Act include a new tax on stock buybacks which will apply to tax years that begin after 12/31/22, a new corporate alternative minimum tax (“AMT”) affecting certain corporations as well as incentives and credits for certain businesses (climate-related provisions).
What will 2023 bring? This is always a tough one. The CLM tax practice has assisted in numerous transactions this year both foreign and domestic. We expect continued traffic in the mergers and acquisition space and continued focus on the cross-border market. We hope for amelioration in the world situation for all.
Thought Leadership and Advisories
- Code §280E Planning Observations: ‘Harborside’ Case Hinges on Definition of ‘Consists of’
In this piece, Melinda Fellner writes that cannabis related businesses should take note of an interesting U.S. Tax Court case affecting their industry. Though not a pro-taxpayer case—the IRS won on the major counts—the Harborside case provides some insight into structuring cannabis-related businesses with a view to deduction of business expenses.
- IRS Announces Broad Penalty Relief For Some Taxpayers if They Act by September 30, 2022
The Internal Revenue Service issued an announcement providing a wide net of penalty relief to certain taxpayers who file the requisite forms by September 30, 2022. This opportunity is potentially a valuable benefit in many circumstances. The Notice provides a waiver of late filing penalties for returns for 2019 and 2020 tax years.
New Partner Announcement
Carter Ledyard welcomes Melinda Fellner to join the Firm as Chair of its Tax Department. Melinda joins us from Rimon PC where her practice focused on transactions including private equity, mergers and acquisitions, real estate and investment funds. In addition to leading the Tax practice, she joins two of Carter Ledyard’s Industry Groups: Real Estate, and Cannabis, Hemp and CBD, given her experience working with entities in these sectors. Melinda also brings experience handling matters in both state and federal tax controversy. Her practice fits well with Carter Ledyard’s international cross-border client practice in the international compliance arena, with experience helping clients navigate the IRS Streamlined Offshore Programs and other options and assisting with other offshore income issues.
As the Firm looks to continue its growth, Melinda’s addition to the Firm brings new value to the Tax practice and she will work closely with teams serving clients in the Trusts & Estates, Corporate, IP and Litigation Departments.