Baker Donelson's tax attorneys are knowledgeable and experienced in a wide range of federal tax law matters. Our tax attorneys regularly provide clients with sophisticated federal tax advice covering matters such as individual income tax planning; business tax planning; employment classifications and tax compliance, audit preparation and representation within the IRS administrative appeals process; tax litigation with the IRS; and enforcement actions by the IRS. We stay informed of significant IRS rulings and notices, proposed regulations, court decisions and related procedures affecting federal tax law, and put that knowledge to use for our clients. The Tax Department regularly updates our clients on current and proposed legislation, with detailed analysis and direct contacts for clients needing more information.
Individual Tax Planning
We have considerable experience advising individual clients with respect to income tax planning, such as compensation issues, stock options, real estate and other investment considerations, among many other tax areas of interest to individuals. Our tax attorneys are knowledgeable in a wide range of individual income tax matters and we assist clients in arranging their affairs in the most tax efficient manner. Additionally, our attorneys draw on a wealth of federal tax experience, including audit preparation and tax litigation, to provide advice that is uniquely informed and beneficial to clients.
Business Planning, Mergers & Acquisitions and Succession Planning
At every stage of the business life cycle, companies need experienced professionals to help minimize their tax burden. Our tax attorneys assist clients from the formation of the business entity to the company's operations and growth strategies, including acquisitions, mergers and reorganizations.
At the beginning of the life cycle, we assist business clients in the choice and formation of the most appropriate business entity for their particular business and tax needs. Clients are advised on the relative advantages and disadvantages of using a partnership, limited partnership, limited liability company, corporation or S corporation, and the most advantageous state in which to form the business entity. On the operational side, clients regularly consult with members of the Tax Department about matters such as employment agreements, non-compete agreements, deferred compensation agreements, stock options, accounting methods and retirement plans.
During the growth stage of a client's business, our attorneys assist clients as they plan for acquisitions and mergers. The Firm has considerable experience in sophisticated acquisition techniques, including tax-favored acquisitive reorganizations, leveraged buy-outs and ESOP acquisitions. In reorganizations, we seek to achieve our clients' goals whether it's strengthening the business financials, divesting a subsidiary or selling a division. If clients decide to close a particular venture, we assist in the liquidation and termination process.
Baker Donelson assists large and small clients across the country and across all industries with business succession planning. Business succession planning involves planning for both voluntary and involuntary transfers of the ownership, management and/or assets of a business. Smart business succession planning should begin in earnest when a business is created, typically when the business entity's formation documents are being drafted. However, with ownership's cooperation, a business may implement a sound succession plan at any point in its life cycle to prepare for expected or unexpected changes to its ownership, management and/or assets in a way that optimizes the post-change health of the business and its owners.
Our tax attorneys have extensive experience seeking private letter rulings and transaction-specific guidance from the IRS on behalf of clients when circumstances warrant. We most often make those requests when a business transaction requires IRS approval prior to implementation.
Tax Credits and Special Incentives
We regularly advise on the utilization of and conditions for numerous types of credits that are available under the Internal Revenue Code. In particular, the Firm's tax attorneys advise financial institutions, investors, businesses and many other interested parties with respect to the new markets tax credit, low-income housing credits, various energy related credits, the rehabilitation tax credit and conservation easements. When catastrophes occur, Congress often responds by creating new incentives to encourage redevelopment and promote commerce – such as the Gulf Opportunity Zone Act of 2005 following Hurricanes Katrina, Rita and Wilma – and we have routinely consulted clients on the special bonus depreciation deduction within the GO Zone Act.
Employment Tax Classification and Compliance
Worker classification has recently become an area of focus for the IRS. In light of this focus, businesses must be mindful of how workers should be classified and how and when wages should be reported. Baker Donelson's tax attorneys work closely with our clients to advise them on the various classification factors used by the IRS in ascertaining whether to treat a worker as an employee or independent contractor. We also assist clients in structuring employment arrangements that reflect the client's business needs and comply with federal tax law. Additionally, attorneys in the Tax Department frequently represent clients before the IRS in a wide variety of employment tax disputes, including employment tax audits, worker classification audits, responsible person inquiries, and trust fund penalty assessments.
See our practice area description on Employee Benefits and Executive Compensation for an overview of our broad experience in this very important area of federal tax law.
Our tax attorneys regularly represent clients during audits, administrative appeals, and trial and appellate litigation with the IRS. Attorneys in the Tax Department are experienced in representing clients before the United States Tax Court, federal district courts and federal appellate courts.
In addition to handling tax controversy issues before the IRS, we also have considerable experience representing clients on a wide range of federal tax enforcement actions undertaken by the IRS. Attorneys in the Tax Department regularly represent clients in preparing offers in compromise, installment agreements, penalty and interest abatement requests, and collection due process requests. Additionally, we have successfully petitioned the IRS for removal of federal tax liens and levies on behalf of our clients.
International, Excise and Other Tax Matters
Clients routinely turn to us for consultation on the domestic tax effects of various foreign country income tax treaties, and we have addressed permanent establishment issues under many of them for clients whose activities may be subject to the treaties. In addition, we consult with our clients regarding the necessity for disclosure of foreign accounts, as well as advice concerning participation in voluntary disclosure programs offered from time to time by the IRS with respect to such accounts. Further, our tax attorneys deal with various other types of taxes imposed through the Treasury Department, including the highway excise tax, firearm and ammunitions excise tax, and a variety of other such taxes.
Representative Tax Matters
- Tax and corporate representation of company in $2 million redemption of hostile investors.
- Represented company in $1 billion proposed assessment of IRS. Settled case for less than $3 million tax paid.
- Represented management in formation of captive insurance companies and alternative risk management vehicles.
- Represented taxpayers in preservation of net operating losses during corporate acquisitions.
- Tax representation of financial institutions in $500 million credit to insurance acquisition and holding company.
- BellSouth Corporation
- Cracker Barrel Old Country Stores, Inc.
- Edwards & Associates, Inc.
- Exide Corporation
- FedEx Corporation
- First Tennessee Bank
- Hunter & Lords Visiting Tailors
- Internet Pictures Corporation
- John H. Daniel Clothing Manufacturing Company
- J.R. Hyde, III
- Level 3 Communications Corporation
- Medical Properties Trust, Inc.
- Piedmont Natural Gas
- Quality Restaurant Concepts
- Rivana Foods, Inc.
- Star Printing Company
- Vining Sparks IBG, Ltd.