Pessin Katz Law, PA writes that in Bross Trucking, Inc., TC Memo 2014-10, the United States Tax Court ruled that a taxpayer’s wholly-owned corporation that ceased operations due to its difficulty with regulatory authorities had no goodwill. As a result, even though the taxpayer’s sons started a new business that had performed some of the same services and had some of the same customers as the father’s corporation, there was no taxable distribution of goodwill from the father’s corporation to the father and no gift from the father to the sons.  The case involved substantial amounts of tax deficiencies, penalties and interest.

via Income Tax – Transfers of Family Business To Children Tax Free | Pessin Katz Law, P.A. – JDSupra.

Posted by Lewis J. Saret, Co-General Editor, Wealth Strategies Journal.