Monte A. Jackel, Lecturer/Of Counsel to Leo Berwick, LP, published a letter to the editor in Tax Notes, a weekly publication of Tax Analysts, Fairfax, VA. The letter is in regard to the new book minimum 15% corporate income tax adopted by the Inflation Reduction Act of 2022, as that tax relates to the taxation of partnerships and partners. This is a significant area of law because corporations derive a significant amount of income and other tax attributes from partnerships.

Jackel was also quoted in the same publication in an article by Lee A. Sheppard on the sale of tax credits pursuant to the same tax act that “such a sale may not even appear in partnership capital accounts [...and] would be as though the purchase transaction was entirely outside the partnership [...].”

Tax Notes Federal and Tax Notes Today Federal
Date: August 20, 2022
By: Monte A. Jackel
Letter to the Editor

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To The Editor:

I write this letter in response to the enactment of the Inflation Reduction Act of 2022 (H.R. 5376), signed into law on August 16. The tax is technically a corporate alternative minimum income tax imposed on “applicable corporations,” those corporations that meet a $1 billion adjusted financial statement income (AFSI) threshold test over a moving three-year period. The focus of this letter is to address the impact of the new corporate tax on corporate partners of a partnership and on partnership shareholders of portfolio (corporate) companies.

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To read the full letter by Monte A. Jackel, click here.

Tax Notes Federal and Tax Notes Today Federal
Date: August 22, 2022
By: Lee A. Sheppard Green
Safe Harbor Leasing

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"Indeed, the purchased credits may not even appear in partnership capital accounts, according to Monte Jackel, of counsel to Leo Berwick and an adjunct professor at Catholic University Law School. It would be as though the purchase transaction was entirely outside the partnership. A prudent adviser to the developer would model the depreciation to see what it is worth to the investors, relative to the costs and trouble of forming and maintaining a partnership, and also model cash flow for a mere sale of the credits."

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To read the full article by Lee A. Sheppard, click here.