2005 Articles

Amendment to applicable sections of the Internal Revenue Code changing the deductibility of attorney fees By Sarah Delano Pavlik August 2005 The case of Officer Cynthia Spina made national headlines in 2002. Officer Spina sued the Forest Preserve of Cook County, Illinois for sexual harassment and employment discrimination.

Amendment to applicable sections of the Internal Revenue Code changing the half-year age conventions to full-year age conventions for retirement plan distribution purposes By Thomas Vasiljevich August 2005 The Code1 provides that certain excise taxes are payable to the U.S. Treasury in the event that distributions from qualified retirement plans2 are made either earlier or later than attainment of certain designated ages.

Amendment to applicable sections of the Internal Revenue Code changing the minimum required distribution rules where a trust is the beneficiary of a qualified plan By Sarah Delano Pavlik August 2005 The Code1 provides that during a taxpayer’s lifetime (after the taxpayer’s required beginning date) and after the taxpayer’s death, minimum annual distributions must be made from the taxpayer’s qualified retirement accounts (“plan”).2

Amendments to Internal Revenue Code Section 5291 By Thomas F. Arends August 2005 Internal Revenue Code Section 529 provides for a tax exemption for qualified tuition programs as well as tax-free treatment on distributions from such plans to eligible, qualified beneficiaries.

Amendments to Internal Revenue Code Sections 55 and 56 By Kelli E. Madigan August 2005 The alternative minimum tax (the “AMT”) is a system of income taxation that operates separate from the regular income tax system.

American Jobs Creation Act By Donna F. Hartl March 2005 The 2004 American Jobs Creation Act was signed by President Bush on October 22, 2004. Although the act purports to target U.S. manufacturing and international trade, it actually affects many other taxpayers and transactions.

Chairman’s corner By Kelli E. Madigan May 2005 We are actively preparing for our annual trip to Washington, D.C., where we will meet with legislative representatives to discuss the expansion of Section 179 deductions, simplification of rules related to education plans, and the inclusion of attorney fees paid on contingency fee cases.

Chairman’s corner By Kelli E. Madigan March 2005 Each year the Section Council makes a trip to Washington, D.C. to promote our legislative agenda to members of the Illinois Congressional Delegation.

Collection procedure update By William M. Gasa March 2005 The reaction of the professional community to the IRS Restructuring and Reform Act of 1998 (RRA98) signed by President Clinton on July 22, 1998 was that there would be a "kinder and gentler" IRS.

Corporate and partnership tax update By James S. Zmuda May 2005 The Internal Revenue Service ("IRS") has issued final regulations regarding qualified real estate investment trust ("REIT") subsidiaries, qualified subchapter S subsidiaries and single-owner eligible entities that are disregarded as entities separate from their owners.

Corporate and partnership tax update By James S. Zmuda March 2005 The Internal Revenue Service ("IRS") has issued final regulations that exempt employers from depositing FUTA taxes until their FUTA tax liability exceeds $500.

Deferred compensation plans: How the new bankruptcy law affects them and an update on IRC Section 409A By Donna F. Hartl October 2005 As most people are aware, a new bankruptcy law goes into effect October 17, 2005.

Employee benefits update By Thomas Vasiljevich & Elizabeth A. Ward March 2005 On October 22, 2004, President Bush signed into law the American Jobs Creation Act of 2004 ("AJCA") which added Section 409A to the Internal Revenue Code of 1986, as amended, (the "Code").

Estate and gift tax update By Franklin S. Mitvalsky May 2005 Here are some recent developments which have occurred in the areas of marital deduction planning, estate administration, will construction and charitable deduction planning which the estate and gift tax practitioner will hopefully find useful.

Estate and gift tax update By Joseph P. O’Keefe March 2005 With the recent re-election of President Bush and the aggressive agenda he has put forward, it looks like our estate and gift tax system is headed for further reform.

Estate tax repeal By Robert J. Krupp August 2005 The debate surrounding the estate tax focuses on eliminating the tax in total or reforming it by increasing the exemption level and lowering the top rate.

Federal individual income tax update By Michelle L. Heller October 2005 Passing the House and Senate on September 21, 2005, this Act provides $6.11 billion in tax incentives to aid or encourage donations to the victims of Hurricane Katrina.

IRS liaison update By Thomas F. Arends May 2005 The editorial staff of the Newsletter would like to inform members of the Federal Taxation Section that Mr. Thomas Arends and Mr. William Gasa of the Section Council currently serve as liaisons for the Section to the Internal Revenue Service.

A message from the Chair By Thomas F. Arends & Richard M. Colombik August 2005 (Notice to librarians: The following issues were published in Volume 51 of this newsletter during the fiscal year ending June 30, 2005: September No. 1; December, No. 2; March, No. 3; May, No. 4.)

Recent cases and rulings regarding estate and gift tax issues By Joseph P. O’Keefe October 2005 The decedent died holding 11.6 percent of the outstanding shares of a bank holding company.

A review of the final regulations under Circular 230 By Guy E. Williams & Scott E. Garwood August 2005 Estate planning practitioners face the prospect of fines, censure, suspension and disbarment from practice before the IRS for violations beginning June 20, 2005—Further regulations issued on May 18, 2005 (see last page) help to clarify some of the problem areas.

Revised Form 1023: What it means for new charitable organizations By Marjorie A. Harris October 2005 In order to qualify for exemption from Federal income tax, most new charitable organizations are required to file Form 1023, Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code, within 27 months following the end of the month in which the organization was established.