Latest News

Letter to Chairman Brady to Include Provisions in Tax Reform

Mar 09, 2017

Attached, please find a link to download the letter the Association sent to Chairman Brady on March 6, 2017  Read more

The Sub S Bank Report Volume 19, Issue 4

Dec 30, 2016

The Sub S Bank Report Volume 19, Issue 4 is now available to read. Learn more about: Post Election Impact; S Corp Still Makes Sense; Shareholder Agreements Can Save the Day for S Elections; S Corporation Talking Notes from the IRS; ADA Website Threats; & The Date of the 20th Annual Conference in 2017. To read it, log in with your membership information. If you need assistance resetting your log in information or did not receive the email copy to your inbox email Amy Trevino at   Read more

Vaulation Comment Period Closes

Nov 04, 2016

The official comment period on the proposed Section 2704 regulations closed on November 2nd with 9,830 comments filed. The Ways & Means Republicans also released a letter on November 3rd stating their strong opposition to the rules. The 24 committee members signed the letter, which states, "The proposed regulations as drafted represent a dramtic change from past practice and history and are not consistent with the congressional intent. In order to avoid immediate and substantial economic harm to family-owned businesses andn the jobs they create, these regulations should be withdrawn. any new proposal in this area should be clearly defined and narrowly targeted withink the reach of the applicable statutory rules." The IRS will host a public hearing on December 1st, where the issue is likely to be addressed.     Read more

Sigh of Relief: S Corps Exempted from 385 Rules

Oct 17, 2016

The final rules offer significant relief for S corp community banks. On October 13th, the Treasury Department and IRS released final and temporary section 385 regulations. These regulations had been proposed on April 4, 2016.  A significant collateral effect of the Proposed 385 Regulations would have been that if debt issued by an “S Corporation” were recharacterized into equity, the deemed equity could invalidate the S Corporation’s “S Election” by being treated as a prohibited second class of stock. The Final 385 Regulations responded to comments requesting relief on this point by excluding S Corporations from the definition of an expanded group, thereby fully exempting debt issued by S Corporations from the section 385 rules.  After much speculation and concern, the final product reflects a significant effort by Treasury and the IRS to limit the scope and burden of the 385 Regulations. The Treasury stated, " Because an S corporation cannot be owned by persons other than U.S. resident individuals, certain trusts, and certain exempt organizations, an S corporation cannot be controlled by members of an expanded group in a manner that implicates the policies underlying the final and temporary regulations. S corporations are therefore excluded from the definition of an expanded group member for all purposes of the final and temporary regulations."  Read more