TAX ALERT | May 02, 2024

Authored by RSM US LLP

Estate planning for real estate requires a strategic and comprehensive approach. From tax implications to the intricacies of property management, this item is designed to help advisers understand how to craft resilient estate plans for clients with large real estate holdings. The discussion highlights eight important estate-planning factors in the real estate context.

1. Retained interest and estate inclusion challenges

Real estate investors typically value retaining some level of control over or the use of the assets they worked hard to grow, which can add complexity to transfer tax planning. Under Sec. 2036, property is sometimes unexpectedly included in a taxpayer’s gross estate if the taxpayer retains the right to enjoy or control it. This extends to what may be seen as indirect control, such as the taxpayer’s managing a family investment entity. For example, if a taxpayer has the sole ability to amend the operating agreement, dissolve the partnership, or make distribution decisions, they could be considered as having retained “strings” to the interest because they potentially control its beneficial enjoyment.

Planning tip: Retaining a life estate under Sec. 2036 in real estate or creating an appearance of continued control will inadvertently trigger issues involving ongoing use or the ability to shift beneficial enjoyment. Such scenarios should be reviewed carefully to minimize the potential for estate inclusion.

2. Valuation discounts

Valuation discounts can play a pivotal role in transfer tax planning for real estate. These discounts consider factors that contribute to lack of marketability and lack of control, including limitations relating to multiple owners, type of assets, and owner agreements that create restrictions that reduce an interest’s value. Discounting is an important consideration for lifetime gifting and interests an estate owns.

Transferring a portion of assets subject to discounting is an effective strategy for transferring assets out of a taxpayer’s estate while retaining some asset management. However, it is crucial to be aware of certain considerations that might not immediately come to mind:

• The transfer will incur upfront costs that vary based on the complexity of the type of assets or entity structure and the state of residence. Qualified business valuations and gift tax returns will also need to be done in the years in which interests are transferred. Additionally, annual administrative costs and other ongoing expenses, such as those for tax filings, are a further financial consideration.
• Operating the business formally will help ensure that the IRS upholds the structure and provides more protection from creditors.
• Upon death, assets previously gifted to an irrevocable trust, including certain real estate assets, will not result in a step-up in basis; thus, the estate and beneficiaries will be unable to step up their basis and depreciate certain real estate assets.

Planning tip: Discounting the value of applicable assets may present a strategic advantage for the taxpayer to mitigate potential gift or estate tax liabilities if formalities are followed.

3. Estate liquidity challenges

Generally, real estate investors reinvest their cash, leaving a potential liquidity issue at death. Sec. 6151 requires that estate tax be paid within nine months after the date of death. If a significant portion of a taxpayer’s assets are illiquid, alternative options are worth exploring, which include an election under Sec. 6161 or Sec. 6166 and Graegin loans, named after Estate of Graegin, T.C. Memo. 1988-477.

Sec. 6161 allows an estate’s executor to extend the time for paying estate tax for up to 10 years when reasonable cause exists. What constitutes reasonable cause may be a high bar. For example, it may take proving that liquidating assets would cause economic harm to the estate. Sec. 6166 provides relief where an estate’s value is composed at least 35% of closely held interests in an active trade or business, but only the tax related to the closely held interests qualifies for deferral. Sec. 6166 relief requires annual interest payments for the first four years and principal and interest payments for the subsequent 10 years. While offering advantages such as early repayment flexibility and using estate income for interest payments, drawbacks include variable interest rates, IRS loan terms, and potential acceleration related to business disposition or state estate tax complications.

Alternatively, Graegin loans offer an additional method for obtaining liquidity to pay the estate tax. They are typically obtained through a financial institution, family business, or irrevocable life insurance trust. If structured correctly, these loans can prevent financial loss from forced asset sales plus allow the estate to deduct the interest on the estate tax return. The deductibility of interest is subject to certain conditions such as the estate’s insufficient liquid assets, certainty of interest without the option for prepayment, and reasonable loan terms. Conditions imposed under Prop. Regs. Sec. 20.2053-3(d)(2) may make it even more difficult to deduct the interest on a Graegin loan.

Estate tax is not the only issue that requires liquidity after death. Marital trust planning is crucial to ensure a sufficient cash flow for the surviving spouse to maintain their accustomed lifestyle. The distributions from a marital trust to the surviving spouse may be unexpectedly reduced by depreciation expense; however, the impact varies based on state law. These types of issues may affect the operational aspects of real estate after the date of death.

Planning tip: When addressing estate liquidity concerns, consider the available options and choose the most suitable method, based on the estate’s unique circumstances and goals.

4. Basis and capital account planning

Generally, real estate that is held for a long time or is the product of multiple previous Sec. 1031 like-kind exchange transactions tends to have a low basis. Retaining these assets until death presents a unique advantage: a step-up in basis. In the case of assets held within a partnership, a step-up occurs not only for the partnership interests but also potentially in the underlying assets by the partnership’s making a Sec. 754 election.

Negative tax basis capital accounts in partnership interests owned by an irrevocable grantor trust can lead to a taxable event upon the trust’s becoming nongrantor during the grantor’s lifetime, triggering a tax liability corresponding to the negative capital accounts.

Additionally, assets owned by an irrevocable grantor trust are generally not included in the decedent’s estate and therefore do not receive a basis step-up (or step-down) at the grantor’s death. However, many irrevocable grantor trusts allow the grantor to swap assets of equal value with the trust. This is particularly valuable if the grantor has high-basis assets in their estate and the trust has substantially appreciated assets with a low basis. If the grantor swaps assets during their life, the low-basis assets held at death will receive a step-up in basis.

Planning tip: Strategically considering asset basis and tax basis capital accounts may provide opportunities for income tax savings.

5. Passive loss rules and selecting the trustee/executor with care

Many real estate investors actively participate in the activities or are considered real estate professionals for income tax purposes, resulting in preferential income tax treatment for purposes of the passive loss rules and the net investment income tax. Determining whether certain activities are active or passive becomes more complex at an individual’s death. There is no authoritative IRS guidance for how activities of a trust or estate are tested for material-participation purposes. Instead, practitioners rely heavily on two cases, Mattie K. Carter Trust, 256 F. Supp. 2d 536 (N.D. Tex. 2003), and Frank Aragona Trust, 142 T.C. 165 (2014). According to these cases, a trust or estate’s material participation depends on the fiduciaries or their agents engaging in those activities. The IRS may introduce regulations in this area, potentially altering the criteria for income tax testing.

Planning tip: If possible, appoint an executor or trustee who may qualify for material participation with respect to real estate owned in a trust or estate.

6. Multigenerational planning and GSTT

Ultra-high-net-worth families, especially those with extensive real estate holdings, should create estate plans that strategically pass down assets across multiple generations. Multigenerational planning requires incorporating the complex application of the generation-skipping transfer tax (GSTT). While many taxpayers are aware of their available $13.61 million gift and estate exemption in 2024 (indexed for inflation), each taxpayer also has the same amount of generation-skipping tax (GST) exemption. The GSTT is in addition to gift tax and estate tax. GSTT has a flat tax rate equal to the maximum estate and gift tax rate, which is 40% in 2024. Protecting legacy assets, including real estate, in trust with GST exemption allocated to it will prevent additional estate, gift, and GST taxes from being imposed on those assets for future generations.

However, the estate/gift and GST exemptions are set to be cut in half beginning Jan. 1, 2026, due to the sunsetting of a provision in the 2017 law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97. The IRS has clarified that exemptions used in a year with a higher exemption than effective at the grantor’s death generally remain outside the taxable estate. The temporarily increased exemptions offer planning opportunities for clients that require prompt review, given the complexity and time involved in most ultra-high-net-worth planning, which often involves multiple estate planning professionals.

Planning tip: Now is the time to engage in estate planning conversations with clients so that they can take advantage of the increased gift/estate and GST exemptions before they sunset on Jan. 1, 2026. Real estate investors should thoughtfully contemplate the succession of their legacy for multiple generations, especially when the family is not a viable option or might not be willing to take on this responsibility.

7. Carried interest gifting valuation issues

Carried interests are commonly held assets for some real estate investors. Since they could greatly appreciate, transferring these assets outside the estate may be a highly effective strategy. Generally, real estate investors believe these assets are nominal in value, but this may not be true under the Sec. 2701 special valuation rules.

If the taxpayer owns other types of interests in the entity, Sec. 2701 may apply and essentially create a deemed gift of an equal portion of each interest even if the grantor retains other interests. Various methods such as making a gift of an equal portion of each interest (referred to as a “vertical slice”) could be used to mitigate the special valuation rules.

Planning tip: Carried interest transfer strategies are complex. Ensure your clients are working with advisers who are well versed in the valuation of these types of assets and that the appraisal is sound and adequately disclosed on a gift tax return to mitigate the risk of IRS scrutiny.

8. Periodic estate plan review

Estate plans should not be static documents created once and put away and forgotten. Regularly reviewing estate plans is vital to ensure they remain true reflections of your client’s life circumstances and evolving wishes.

Periodic estate planning review is critical for the following reasons:

• Life-changing circumstances: Life is dynamic, and events can affect estate plans, including marriage, divorce, the birth of children or grandchildren, the death of a family member, and changes in financial status. When these life-changing events happen, reviewing the estate plan will allow you to make sure it is aligned with your client’s wishes.
• Change in assets: If the value of assets increases or decreases significantly, taxpayers may need to adjust their estate plans to optimize tax savings, asset protection, or charitable giving. Also, when acquiring or selling a business or investment, taxpayers may need to update their estate plans to reflect their desired succession planning.
• Change in tax laws: Ever since the TCJA was enacted, individuals and their advisers have been busy using the temporarily doubled estate, gift, and GST exemptions that will sunset to about $7 million, indexed for inflation. The temporarily increased exemptions are a “use it or lose it” opportunity. Updating an estate plan is crucial, especially with tax laws that have changed or are expected to change.

Planning tip: An estate plan should be reviewed and updated at various times. Clients currently can take advantage of the increased gift/estate and GST exemptions with the guidance of their advisers.

Collaboration is key

Estate planning is a multifaceted endeavor that demands a comprehensive and collaborative approach, particularly when planning for real estate and its distinctive tax-related intricacies. In navigating the complexities of wealth transfer, it is paramount to involve not only the client but also a collaborative team consisting of attorneys, accountants, and financial advisers.

This collective effort ensures that every facet of the client’s financial landscape is meticulously considered, leading to the formulation of the most effective and tailored estate plan to achieve the client’s goals.

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This article was written by Carol Warley, Scott Filmore, Amber Waldman, Shannon Ulrich and originally appeared on 2024-05-02. Reprinted with permission from RSM US LLP.
© 2024 RSM US LLP. All rights reserved. https://rsmus.com/insights/tax-alerts/2024/top-8-estate-planning-factors-for-real-estate.html

RSM US LLP is a limited liability partnership and the U.S. member firm of RSM International, a global network of independent assurance, tax and consulting firms. The member firms of RSM International collaborate to provide services to global clients, but are separate and distinct legal entities that cannot obligate each other. Each member firm is responsible only for its own acts and omissions, and not those of any other party. Visit rsmus.com/about for more information regarding RSM US LLP and RSM International.

ARTICLE | January 09, 2024

Authored by RSM US LLP

Executive summary: State tax ASC 740 Q4 update

The following state tax developments were enacted during the fourth quarter of 2023 and should be considered in determining a company’s current and deferred tax provision pursuant to ASC 740, income taxes, for the quarter ended Dec. 31, 2023. This information summarizes the listed developments and may not provide additional nuanced considerations that may be relevant for provision purposes. For questions about these quarterly updates or other recent legislative and regulatory developments, please reach out to your tax adviser for more information. 

State income tax law changes for the fourth quarter of 2023

California court upholds single-sales factor apportionment

The California Court of Appeals upheld Proposition 39, which was approved by voters on a ballot initiative and enacted in 2012. Proposition 39 required the use of single-sales factor apportionment for taxpayers and eliminated the use a three-factor apportionment formula. Proposition 39 also provided a special apportionment rule for cable companies and created a fund for clean energy projects. The taxpayer argued in One Technologies LLC. v. Franchise Tax Board (Cal. Ct. App. (2nd) No. B318787, Oct. 23, 2023), that Proposition 39 violated the state’s single-subject rule for ballot initiatives due to the exceptions noted above. The Court found that Proposition 39 did not violate the state’s single-subject rule and as a result, the taxpayer was required to use the single sales factor apportionment formula.

California court rejects FTB’s attempt to limit PL 86-272 protections on procedural grounds

On Dec. 13, 2023, a California Superior court found Technical Advice Memorandum (TAM) 2022-01 and related Franchise Tax Board (FTB) Publication 1050 to be invalid. American Catalog Mailers Association v. Franchise Tax Board, Case No. CGC-22-601363 (Cal. Superior Ct., San Francisco Cnty., Dec. 13, 2023). Both pieces of guidance clarified the FTB’s interpretation of the protections of P.L. 86-272 for internet-based activities, which were intended to closely follow the guidance issued by the Multistate Tax Commission (MTC) in August of 2021. The court did not rule on the merits of the case, finding instead that TAM 2022-01 and Publication 1050 were invalid because they constituted regulations that were required to be adopted pursuant to the California Administrative Procedure Act (APA), which would have required notice and a period for public comment.

Colorado updates conformity rules

On Nov. 8, 2023, the Colorado Department of Revenue repealed Colo. Regs. Section 39-22-103(5.3), which had clarified that Colorado’s definition of the IRC incorporated federal changes on a prospective basis only. Colorado conforms to the IRC on a rolling basis, and the change was in response to prior legislation and a Colorado Court of Appeals ruling in 2022.

Kansas provides guidance on corporate tax rate reduction

On Oct. 24, 2023, the Kansas Department of Revenue issued Notice 23-10: Change to Corporate Income Tax Rate with guidance on the rate reduction that previously was announced on Aug. 31, 2023. The department explained that, prior to rate reduction of Kansas Stat. Ann. Section 74-50,321, Kansas imposed a corporate income tax rate of 4%, with a surtax of 3% on Kansas taxable income exceeding $50,000. While section 74-50,321 reduces the rate from 4% to 3.5% for tax years beginning on or after Jan. 1, 2024, the 3% surtax continues to apply.

Maine court requires taxpayer to look-through to pharmacy location in sourcing receipts from claims adjudication services

On Nov. 7, 2023, the Maine Supreme Judicial Court held that the receipts the taxpayer received from claims adjudication services in connection with the sale of pharmaceuticals were sourced to the pharmacy location. Express Scripts Inc. et al. v. State Tax Assessor, Me. Sup. Jud. Ct., No. 2023 ME 68 (Nov. 7, 2023). In Express Scripts, Inc., the taxpayer’s clients included health insurers, health maintenance organizations (HMOs), employers, governmental health programs and union-sponsored benefits plans. The clients’ members were individuals and employees covered by the health plans. Maine’s market-based sourcing rules require that receipts from services are sourced to the location that the benefit of the services are received. The taxpayer argued that benefit of the service is received at the location of its business customer (i.e., the headquarters or commercial domicile of the health insurer). The Court disagreed, finding that the services ultimately were received by the individuals at the pharmacy location. In its ruling, the Court pointed to language within the company’s public filings and contracts that indicated the ultimate recipients of the services were the client members of the taxpayer.

Massachusetts enacts single-sales factor apportionment for all business taxpayers

On Oct. 4, 2023, Gov. Maura Healey signed into law House Bill 4101, enacting a comprehensive tax relief measure. Most notable for business taxpayers, the law adopts a single-sales factor apportionment formula for taxpayers of all industries, effective for tax years beginning on or after Jan. 1, 2025. Previously, single-sales factor apportionment was required only for manufacturers and mutual fund service companies, while all other corporations and financial institutions were required to apportion income and non-income taxes to Massachusetts using a three-factor double-weighted sales apportionment formula.

Note that the change to apportionment impacts not only the calculation of a taxpayer’s measure of income tax within the state, but also the measure of non-income tax, which is based either on the taxpayer’s Massachusetts tangible personal property or net worth. Additionally, the law makes changes to the sourcing of certain receipts from investment and trading activities for financial institutions. Please read our article, Massachusetts passes comprehensive tax relief for more information.

Minnesota court affirms decision that the gain on the sale of goodwill is apportionable business income

On Nov. 22, 2023, the Minnesota Supreme Court affirmed the Minnesota Tax Court’s decision in Cities Management Inc., vs. Comm’r of Rev. (Case No. A23-0222, Nov. 22, 2023) that the income earned by a nonresident individual resulting from the sale of her stock ownership interests in two S corporations was business income subject to apportionment. In Cities Management, Inc., the taxpayer made an election under section 338(h)(10) to treat the stock sales as sales of the underlying corporate assets, with a significant portion of the value being goodwill. The Court found that the value of the goodwill could be attributed to the corporation’s business operations and as a result, the gain from the sale was derived from a unitary asset that is treated as business income and subject to apportionment.

Mississippi issues guidance on the election for immediate expensing of certain expenditures

On Oct. 20, 2023, the Mississippi Department of Revenue issued guidance on House Bill 1733, which amended Miss. Code Ann. Section 27-7-17 to revise the methods of depreciation that may be used for certain expenditures and property. House Bill 1733 is effective for tax years beginning after Dec. 31, 2022. The department clarified that:

• Taxpayers may elect to immediately deduct qualified research and experimental expenses that must be capitalized and amortized for federal purposes pursuant to section 174;
• Expenditures for business assets that are qualified property or qualified improvement property (QIP) are eligible for 100% bonus depreciation and may be deducted as an expense incurred by the taxpayer during the tax year in which the property was placed in service. Taxpayers may elect to take a bonus depreciation deduction in accordance with section 168;
• Taxpayer may elect to treat the cost of any section 179 property that was placed in service during the taxable year as an expense that is deductible in the current year.

New Jersey issues several bulletins providing guidance for previously enacted legislation

The New Jersey Department of Taxation issued new and updated tax bulletins throughout Q4 2023 intended to provide guidance on legislation enacted on July 3, 2023, that made significant changes to the corporate income tax. The guidance covers topics including but not limited to:

• Changes to the rules related to the dividend exclusion, and the ordering of the net operating loss (NOL) deduction, dividend exclusion and international banking facility deduction;
• Changes to the calculation of the combined group’s NOL deduction;
• Changes impacting forms and schedules that must be included with the corporate income tax return; and
• Changes impacting income reporting and accounting methods for non-US corporations that are included in a combined return claiming treaty protection.

For more information please see our article on the legislation, New Jersey enacts most significant tax changes in years and consider reviewing the more recent relevant bulletins: TB- 86R; TB-91R; TB 94R; TB 95R; TB-99R; TB 101R; TB-103R; TR 111; TB-112; TB-113

New York State adopts final regulations related to corporate franchise tax reform of 2014

On Dec. 27, 2023, the New York Department of Taxation formally adopted regulations related to Article 9-A corporate franchise tax and Article 33 insurance corporation franchise tax that were proposed on Aug. 9, 2023. Years in the making, the final regulations provide guidance as it relates to comprehensive franchise tax reform that was enacted in 2014 and as amended in 2015 and 2016. The final regulations cover several topics including but not limited to economic nexus (including protected and unprotected activities under PL 86-272), apportionment, computation of the tax, certain credits, combined unitary reporting and rules impacting specific industries (such as qualified New York manufacturers). The department clarified that the regulations, effective as of Dec. 27, 2023, interpret statutory amendments that are effective for periods beginning on or after Jan. 1, 2015 and thus will apply for the same periods (retroactively as of Jan. 1, 2015). Documents relating to the adoption of the final regulations can be found on the department’s website.

New York City revives tax credit for qualified emerging biotechnology companies

On Dec. 4, 2023, New York City Mayor Eric Adams signed legislation that revives a tax credit for qualified emerging biotechnology companies. The credit may be used to offset the general corporation business tax, the unincorporated business tax, and the corporate tax of 2015. The enacted law has immediate effect and will be available for taxpayers to claim for tax periods beginning on or after Jan. 1, 2023 and prior to Jan. 1, 2026. For additional details on the credit and taxpayer eligibility requirements, please see our article, New York City biotech tax credit revived.

North Carolina enacts changes to the franchise tax and expands the pass-through entity tax

Enacted on Oct. 3, 2023, House Bill 259 caps the franchise tax at $500 on the first $1 million of a corporation’s franchise tax base. For the tax base exceeding $1 million, the rate is $1.50 per $1,000. This change is effective for tax years beginning on or after Jan. 1, 2025 (as reported on the corporate tax return for the 2024 tax year).

The bill also expands the elective pass-through entity tax provisions retroactively for tax years beginning on or after Jan. 1, 2022. Specifically, the legislation expands the list of eligible owners to include entities classified as corporations for federal income tax purposes and partners that are a trust provided that the beneficiary of the trust is limited to any person other than an individual, an estate, a trust or an organization described in section 1361(c)(6) of the IRC.

For additional information, please read our tax article, North Carolina budget passes with tax cuts and other modifications.

Pennsylvania issues guidance on sections 381, 382 and 163(j)

On Oct. 11, 2023, the Pennsylvania Department of Revenue issued Corporation Tax Bulletin 2008-03 which provides revised guidance on the application of sections 381 and 382. The guidance explains that taxpayers are required to consider the impact of section 163(j) in determining the net operating loss deductible for a given tax year. In calculating the applicable section 382 limitation for Pennsylvania purposes, the limitation is equal to the federal section 382 amount multiplied by the Pennsylvania apportionment percentage for the tax period immediately preceding the change. The guidance provides a detailed explanation on the application of sections 382 and 163(j) for purposes of the Pennsylvania corporate income tax return.

On Oct. 12, 2023, the Pennsylvania Department of Revenue issued an updated state corporate net income Corporation Tax Bulletin 2019-03 addressing the application of section 163(j). The bulletin clarifies that where a Pennsylvania taxpayer is part of a consolidated federal return that is subject to interest deduction limitations under section 163(j), each member of the consolidated group that is subject to Pennsylvania corporate income tax must calculate a section 163(j) limitation for Pennsylvania purposes on a pro-forma basis. However, to the extent that the federal consolidated group is not subject to any section 163(j) limitations, there shall be no interest deduction limitations for Pennsylvania purposes. Additionally, the bulletin clarifies that in most instances where there was a federal consolidated section 163(j) limitation for previous periods and a separate company limitation calculated for Pennsylvania purposes, taxpayers that join in the filing of a current year federal consolidated return with no section 163(j) limit may can fully deduct interest expense, plus the interest expense carryforward from prior years for calculating their Pennsylvania corporate income tax.

Texas guidance on compensation deduction

On Oct. 13, 2023, the Texas Comptroller of Public accounts issued 202310005L with guidance on costs that are allowable as benefits in determining the compensation deduction from the Texas Margin tax. For purposes of calculating the compensation deduction, the cost must:

• Be similar to the items listed in Texas Tax Code section 171.1013(b)(2) (i.e., workers’ compensation benefits, health care, employer contributions HSAs) such that it provides value to an employee in a personal capacity;
• Be deductible for federal income tax purposes;
• Not already be included in wages and cash compensation; and
• Meet the other requirements of title 34 Tex. Admin. Code section 3.589(e).

The comptroller also provided several examples that may be included as benefits in the compensation deduction including but not limited to sports club memberships, health check-ups, cell phones, professional dues, tuition reimbursement, and personal use of a company-owned vehicle. Additionally, the guidance provides examples of costs that must be excluded from the compensation deduction, such as recruiting referral fees, training, travel per diems, and the business use of a company-provided vehicle.

Wisconsin updates conformity to IRC

On Oct. 25, 2023, Wisconsin Gov. Tony Evers signed Assembly Bill 406, updating Wisconsin’s conformity to the IRC. For tax years beginning after Dec. 31, 2022, Wisconsin retroactively conforms to the IRC as amended to Dec. 31, 2022, but not including any amendments to the IRC that are enacted after Dec. 31, 2022. However, note that Wisconsin continues to have exceptions to federal conformity for several provisions of the IRC prior to 2021. Wisconsin issued Tax Bulletin 223 with more explanation of the changes. 

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This article was written by Al Cappelloni, Amy Letourneau, Darian A. Harnish, Mo Bell-Jacobs and originally appeared on 2024-01-09. Reprinted with permission from RSM US LLP.
© 2024 RSM US LLP. All rights reserved. https://rsmus.com/insights/tax-alerts/2024/state-income-tax-law-changes-fourth-quarter-2023.html

RSM US LLP is a limited liability partnership and the U.S. member firm of RSM International, a global network of independent assurance, tax and consulting firms. The member firms of RSM International collaborate to provide services to global clients, but are separate and distinct legal entities that cannot obligate each other. Each member firm is responsible only for its own acts and omissions, and not those of any other party. Visit rsmus.com/about for more information regarding RSM US LLP and RSM International.

The information contained herein is general in nature and based on authorities that are subject to change. RSM US LLP guarantees neither the accuracy nor completeness of any information and is not responsible for any errors or omissions, or for results obtained by others as a result of reliance upon such information. RSM US LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect information contained herein. This publication does not, and is not intended to, provide legal, tax or accounting advice, and readers should consult their tax advisors concerning the application of tax laws to their particular situations. This analysis is not tax advice and is not intended or written to be used, and cannot be used, for purposes of avoiding tax penalties that may be imposed on any taxpayer.