Monthly Archives: November 2016

Applicable Federal Rates for December 2016

The Internal Revenue Code prescribes minimum imputed interest rates and time-value-of-money factors applicable to certain loan transactions and estate planning techniques. These rates are tied formulaically to market interest rates. The Internal Revenue Service updates these rates monthly.

These are commonly applicable rates in effect for December 2016:

Short Term AFR (Loans with Terms <= 3 Years)                                          0.74%

Mid Term AFR (Loans with Terms > 3 Years and <= 9 Years)                    1.47%

Long Term AFR (Loans with Terms >9 Years)                                              2.26%

7520 Rate (Used in many estate planning vehicles)                                     1.8%

Here is a link to the complete list of rates: https://www.irs.gov/pub/irs-drop/rr-16-27.pdf?_ga=1.114444423.1043379965.1429544687

E. John Wagner, II
jwagner@williamsparker.com
941-536-2037

Post-Election Flashback: A Tax Break For Federal Executive Office Appointees

With President-elect Donald Trump’s cabinet appointments at the forefront, we revisit our August 2016 post examining a capital gains tax break for federal executive appointees who must sell assets to avoid conflicts of interest.  We noted that appointees with unrealized capital gains in undiversified assets could use the law to diversify without paying capital gains tax, creating a tax break vastly more valuable than anything else they earn from their positions.

Here is a link to our original post:  http://blog.williamsparker.com/businessandtax/2016/08/17/want-diversify-appreciated-asset-position-without-paying-capital-gains-tax-take-federal-government-job-conflict-interest/

Here is a link to a November 8 International Business Times article quoting our post and further examining the tax deferral law: http://www.ibtimes.com/political-capital/wall-street-titans-could-get-tax-benefit-taking-jobs-trump-or-clinton-white-house

Are any potential Trump appointees likely to benefit?  Decide for yourself after reviewing a roster of potential appointees:   https://www.washingtonpost.com/graphics/politics/trump-administration-appointee-tracker/?hpid=hp_hp-top-table-main_cabinet-graphic-135pm%3Ahomepage%2Fstory

E. John Wagner, II
jwagner@williamsparker.com
941-536-2037

Ally Law London Firm Wins Article 50 Brexit Challenge

Williams Parker has international reach as the Florida member of Ally law – one of the world’s leading law firm networks. Our companion firm in London, Edwin Coe, represented the winning claimant, Dier Dos Santos, in the high-profile litigation in the U.K. challenging Article 50 and the Brexit vote. The High Court of Justice ruled that based on a 300-year-old law, the U.K. government does not have the constitutional capacity to trigger U.K.’s withdrawal from the European Union without a Parliamentary vote. More information on the ruling and its consequences can be found here.

Williams Parker regularly works with Ally Law attorneys to make sure our clients receive the legal support they need wherever in the world they might operate or have investments. Ally Law includes over 1,300 lawyers in 41 countries. More information on Ally Law can be found on our website.

Michael J. Wilson
mwilson@williamsparker.com
941-536-2043

Does a Republican Sweep Augur Federal Tax Reform?

Amongst many things, the Republican sweep in yesterday’s election improves prospects for the most significant tax reforms since 1986.

While we instinctually focus on possible changes to our personal tax burdens, business income taxation may offer the most opportunities for structural reforms. Structural changes may or may not reduce the amount of tax revenue. They are, at least in theory, policy driven to encourage business behavior consistent with greater economic growth.

Changes on the table include taxing business income that is reinvested (rather than distributed to owners for their personal uses) at a lower rate, and changing the international tax regime to a territorial system that does not tax income earned in other countries when repatriated to the United States. The former may encourage business investment spending. The latter may reduce distortions in capital flows into the United States caused by the current tax regime. Both changes would bring the United States closer in line with the tax systems in other developed countries.

And, of course, our leaders will revisit Obamacare, including the new taxes it created.

President-Elect Donald Trump’s proposals do not exactly match those in Congress. Disagreement could impede reform. But with House Speaker Paul Ryan and President-Elect Trump both focusing on tax reform, we will see the most serious tax reform debate in many years.

Here are links to recent media discussion of possible tax reforms:

http://www.wsj.com/articles/donald-trump-win-gives-gop-fuel-to-slash-taxes-1478687402

http://www.forbes.com/sites/anthonynitti/2016/11/09/president-trump-what-does-it-mean-for-your-tax-bill/#53ec8be84b8b

E. John Wagner, II
jwagner@williamsparker.com
941-536-2037