Message from the Firm

By Brad Cohen

A desirable feature of “S” corporations is the ability of its shareholders to utilize their share of the corporation’s losses as deductions on their personal tax returns. In this issue, David Schwartz discusses a method whereby shareholders of “S” corporations might maximize their ability to personally deduct such losses, based on a recent decision by the U.S. Tax Court.

In the second article, Steve Halper discusses the dramatic – and sometimes surprising – effect that a single percentage point of stock ownership might mean to a shareholder of a California corporation. Many businesses incorporate based on a simple handshake between participants. Rarely are the participants aware of the many “breakpoints” that might be meaningful to their ownership percentages.

While LLCs abound, limited partnerships remain a viable entity of choice in many situations. With the passage of “Re-RULPA,” California has once again overhauled its limited partnership laws by adopting a new uniform act enacted by other states as well. However, the California version omits one of the most favorable features of the uniform law. Find out more about the new law in this issue.

Also with this newsletter, we are sending you the published article “In the Know: New Laws Cover Everything from Minimum Wage to Trade Secrets. Here’s a Primer” written by the head of our Employment Law Practice Group, Mark Terman (MarkTerman@Reish.com).

As always, if you have a question about an article in this newsletter, please contact the author or me.

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