Category Archives: Articles

Shareholder Disputes at Closely-Held Businesses

Over the last twenty years, an increasing number of attorneys have contacted me about litigation among shareholders of closely-held businesses. Shareholders of closely-held businesses in various parts of the United States are embroiled in litigation with each other over the amount of compensation that one or more of the shareholder-officers received. These lawsuits seem to…
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Preventing a Challenge to (Un)Reasonable Compensation

© 2013 American Institute of CPAs - All Rights Reserved. Reprinted with permission from the September 2013 issue of Journal of Accountancy. ►  IRS scrutiny of excessive executive compensation is increasing, affecting many types of taxpayers.  CPAs need to advise their clients on steps they can take to lessen their exposure in this area. By…
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Determining Guaranty Fees for Those who Personally Guarantee a Company’s Debts

It is common for business owners to personally guarantee their companies’ debts.  This is a valuable service since many companies could not otherwise obtain financing in the current lending market.  But business owners are already exposed to considerable risk and do not want to assume even more liability.  When they do, the value of their guaranty…
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Which Types of Compensation are Considered?

The reference in § 162(a)(1) to “other compensation” includes all current and deferred compensation. Deferred compensation includes employer contributions to qualified retirement plans and non-qualified deferred compensation arrangements.  The current value of any equity-based compensation, such as stock options, is also considered.  The costs of welfare benefits and fringe benefits are also included in total…
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