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Strategies for Maximizing the Tax Benefits of 1031 Tax-Deferred Exchanges, Renewable Energy Credits, and Asset Protection Trusts
Produced on December 05, 2019
Course Information
Course Description
Investors and business owners often ask their attorneys how they might take advantage of tax-saving opportunities. Tax-deferred exchanges of real property under Code Section 1031, Renewable Energy Credits offered under Code Section 48, and asset protection trusts that can be created in tax-friendly environments such as Delaware, are all available to the taxpayers who have the correct tax appetite and asset profile. Many attorneys do not have clarity on the mechanics and requirements of these tax-saving vehicles, which can inhibit the breadth and depth of representation they offer to their clients.
This program, presented by Sara Holland of Lewis Brisbois, will not only cover the mechanics of 1031 exchanges, renewable energy tax credits, and how best to use asset protection trusts to avoid income tax on the growth of low basis assets, but it will also highlight several important considerations for each of these tax-saving opportunities. For example, there are special rules relating to the identification of replacement property in 1031 exchanges. 1031 exchanges cannot be transacted by partnerships, which has lead to the use of TIC (tenants-in-common) agreements and “drop-and-swaps.” Renewable energy credits are subject to the passive loss rules under Code Section 469, so taxpayers must have the correct tax appetite to take full advantage of these credits. Asset protection trusts are under-used estate planning tools that can save taxpayers money by avoiding state-level income tax on growth of low-basis assets. These trusts also offer other benefits, such as protecting assets from divorcing spouses and litigants.
Learning Objectives:
- Explore the mechanics of a Section 1031 tax-deferred exchange and “reverse exchange”
- Gain familiarity with the characteristics that distinguish a tenants-in-common agreement from a partnership agreement, and how a “drop-and-swap” can help taxpayers take advantage of 1031 exchanges
- Recognize the different categories of renewable energy credits, how the credits are calculated and what qualifies as “energy property”
- Navigate the relationship between the passive loss rules and energy credits, and how to draft operating agreements for the entities that own the energy property to maximize the taxpayer’s ability to apply the tax credits to active income
- Identify the requirements of creating an asset protection trust in Delaware and which taxpayers are best suited to take advantage of their tax-saving and asset protection benefits
Credit Information
Faculty
Sara Holland
Lewis Brisbois
Sara Holland is a partner in the Newark and New York offices of Lewis Brisbois and a member of the Corporate and Tax Practices. Ms. Holland began her career as a litigator, serving as in-house counsel for a national insurance carrier and sat first chair on a dozen jury trials. Her pro bono work with Trial Lawyers Care and the New York Coalition for Healthy School Food prompted Ms. Holland to focus on exempt organizations and tax law. She earned her LLM in taxation in 2015 and brought her perspective as a litigator to her corporate and tax practices.
After practicing at a prominent New Jersey law firm, Ms. Holland joined Lewis Brisbois in 2019. She focuses on mid-market mergers and acquisitions, business succession planning, tax deferred exchanges, tax-free reorganizations, and maximizing the tax benefits of tax credits and estate planning. Ms. Holland works with business owners to create partnerships, limited liability companies, and corporate entities, including entity formation and the tax considerations of such ventures. She also advises clients on the tax implications of buying or selling partnership interests, membership interests, and shareholder interests, as well as the tax filings at both the entity level and partner/member level. Ms. Holland frequently counsels her clients on the drafting and revising of partnership agreements, operating agreements, and shareholder agreements. Ms. Holland counsels her clients on 1031 exchanges, Qualified Opportunity Zones, SALT, energy credits, exempt organization law, and asset protection following major liquidity events. Her corporate clients are located nationwide and internationally, which allows Ms. Holland to work closely with her business practice group colleagues located in Lewis Brisbois offices across the country. Ms. Holland continues to represent exempt organizations and guides her nonprofit clients on matters relating to programming, corporate governance, state and federal exempt organization law.
Reviews
Very helpful for me as I work with clients in 1031 exchanges.
Clear well organized and informative
Excellent program and speaker. Each topic warranted 90 minutes of coverage. Asset protection portion was especially valuable.
I appreciated the examples provided throughout the presentation.
Very informative course.
thanks for the wonderful course
outstanding course materials
good course
Very thorough. Lots of information..Well done.
Sara Holland clearly understands her practice areas. Her presentation was one of the best I have participated in in recent years.
Very good and comprehensive
Very Interesting Course! Speaker is knowledgeable and informative. She is a smart and effective communicator. Enjoyed this topic. Important information. Highly Recommend this course.
The presenter was excellent and I learned quite a bit from the presentation
Tough material; presenter did a good job of providing clear road maps to help navigate to opportunities within a complicated transactional area.
Made boring tax code information interesting and understandable with her approach!
Excellent presentation and materials.
Good presentation on a very dry topic
very good
Well done.