Edition 129

Tax Day is finally in the rearview mirror, and if you’re like many practitioners—with the phones quieter, the inbox manageable, and the September extension wave feeling comfortably far away—the temptation right now is to coast. Resist that temptation. Summer is the only stretch of the calendar when both you and your best clients have the bandwidth to think strategically; furthermore, this summer, there is a deadline-driven opportunity. In this article, I’ll walk through three moves every practitioner should be making between now and Labor Day. The first move has a hard statutory deadline of July 10, 2026. The second move is about turning your highest-value client conversations into billable advisory engagements. And third is about tending to the practice itself because a tax practice, like a garden, doesn’t survive without care.

Perhaps the most misunderstood aspect of partnership taxation relates to distributions. When a partnership distributes cash or property to its partners, the tax consequences can range from completely tax-free to significantly taxable, depending on how the distribution is structured and the partners' tax basis in their partnership interests. In this article, we'll explore the rules governing partnership distributions and how they impact partners' tax situations. More importantly, we'll look at strategies to structure distributions in the most tax-efficient manner possible – because the goal is not just to understand the rules but to use them advantageously.

The Jeffrey Winick tax story is about one of the simplest methods of not paying taxes. That simple method of not paying is simply not paying. Winick is a very successful real estate broker specializing in retail leases. The company he founded, Winick Realty (now rebranded RTL), has in the past been listed as one the top five of retail brokers in New York City. As far as my friend Grok can discern, Winick managed all this with no formal education beyond high school. That makes it extra impressive. I identify with him just a bit. He grew up in Kew Gardens Hill, Queens, New York, and is 75 years old. I also grew up not far from Manhattan and am 74. I sometimes fantasize about living in Manhattan. He's living there, and apparently he was really living. His lifestyle was a major topic in the litigation.

I'm almost nostalgic for the days of 2021-2022, the COVID-induced tsunami of Tax Court filings and cases. This month we've seen only eight T. C. Memos, of which two were routine undocumented deduction cases (Section 6001 or Section 274), no Sum. Ops, and no T. C.s. It's been years since practitioners murmured the old, nearly-forgotten slogan as they booked their summer vacations: "File in May and go away," but it may be time again. Here's what happened.