For many years the IRS has argued for a broad reading of the term “partnership item”, items that demand entity-level determinations. In the Journal of Passthrough Entities, columnist Thomas Greenaway analyzes the recent case of Alpha I, L.P., a case where the Court of Federal Claims rejected an IRS attempted broad-reaching interpretation of the term “partnership item” in a TEFRA proceeding (Tax Equity and Fiscal Responsibility Act, provisions of which are found in Code Secs. 6221 through 6233). The holding for the taxpayer in this case may signal a need for a revision of the IRS’s approach in these types of cases.

With provisions of the 2001 Economic Growth and Tax Relief Reconciliation Act set to sunset in 2011 and mindful that without Congressional action 2010 will be a year without estate tax, many questions remain unanswered. However despite the uncertainty, planning remains crucial in effectuating the most tax and cost efficient transfer of wealth. Angela Beasley Phyfer and Chrissy M. Leggett discuss tax efficient planning alternatives available in the current environment.

The Unemployment Insurance program at the federal and state levels is funded by employer payroll taxes. The weak economy is impacting state unemployment insurance trust funds across the nation setting the stage for unemployment insurance increases on business. In her article in the Journal of State Taxation, Lori Roberts explores these negative effects on the state’s ability to fund unemployment insurance including a list of states that are in jeopardy of losing their Federal Unemployment Tax Act (FUTA) credit.

In today's economic climate, employers are faced with difficult decisions regarding their 401(k) employer contributions. In this article, Bruce B. Barth, Cynthia C. Christie and Virginia E. Spiess discuss how proposed regulations and a new safe harbor option may help employers keep their options open. During difficult economic times, the reduction or suspension of contributions in lieu of other cost-cutting measures such as layoffs and salary freezes will continue to present an option as a short-term solution until the economy improves.