State Taxation on the Sale of Pass-Through Entity Interests
Sourcing Issues, Tiered Entities, Apportionment vs. Allocation, Residents vs. Nonresidents, Circumventing the SALT CAP
Note: CLE credit is not offered on this program
Recording of a 110-minute CPE webinar with Q&A
This webinar will explain the issues practitioners encounter when reporting and taxing the sale of an interest held in a pass-through entity (PTE). Our panel of SALT veterans will discuss how types of owners, residency, and various state approaches (or lack thereof) impact these calculations, including examples of taxation in specific states.
Outline
- Flow-through entities
- Determining nexus
- Determining state taxable income
- Specific sourcing issues
- Gain on sales of interests
- Classification as an asset sale
- Sales of intangibles
- Other issues
- Other entity-level taxes
- Circumventing SALT cap
Benefits
The panel will review these and other critical issues:
- How asset sales and stock sales treatment differs among states
- How residency impacts state reporting of disposition income
- How ownership type (individual, entity, tiered entity) affects state taxation of PTEs
Faculty
Elil Shunmugavel Arasu
Managing Director, GWDC SALT Practice Leader
BDO USA
Ms. Arasu has more than 15 years of state tax consulting experience within a public accounting environment and... | Read More
Ms. Arasu has more than 15 years of state tax consulting experience within a public accounting environment and concentrates on income and franchise tax issues such as nexus, state tax base modifications, apportionment of income, business/non-business income, unitary taxation, gross receipt taxes, allocation of partnership items, and state filing options. Ms. Arasu consults on all aspects of state income tax, including participating in M&A transactions, due diligence reviews, representation on state tax controversy matters, and assisting companies with state tax compliance and state tax accrual reviews. She has worked with Fortune 1000 and mid-size companies in industries such as manufacturing, retail, healthcare, hospitality, real estate, technology, and transportation.
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Richard W. Spengler, CPA
National Technical Leader - State & Local Tax
BDO USA
Mr. Spengler's main area of focus is state income and franchise taxes with significant experience in the design and... | Read More
Mr. Spengler's main area of focus is state income and franchise taxes with significant experience in the design and implementation of legal entity structures that are more tax efficient. As a result of his unique background, he has had success in designing structures that both minimize the impact on his client’s operations while maximizing the tax savings received by the client. Mr. Spengler specializes in the design of structures that both complement the client’s underlying business and provide diversified tax savings. As such, he has successfully designed structures for clients that simultaneously reduce state income tax, Single Business Tax, franchise tax, sales & use tax and federal income tax while logically fitting within the way the business operates. In addition to restructuring work, Mr. Spengler also has significant experience with the analysis of tax return positions and with the subtle interaction between the Federal income tax framework and its impact on a client’s state income tax reporting. He has had a great deal of success with securing significant refunds for clients related to gray and misunderstood areas of the tax law.
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