July Developments – Part II – Including A YTMP Exclusive
The recent decision is about the value of the gifts that Linda and Peter made. It was $35,141,321 each which strikes me as pretty disastrous. Remember the gift is going up a generation. How that relates to whatever they achieved with the promissory notes is beyond me. I also have to admit to being lost in the valuation discussion.
Couple Gets Lawsuit Settlement And Comes Out Behind After Tax
If you are taxed on the proceeds from a lawsuit, it seems like you should be able to deduct the legal fees involved at least to the extent of your income. Only that is not the way it generally works. There are a couple of exceptions with AGI deductions for discrimination suits (IRC 62(a)(20) and whistleblower suits (IRC 62(a)(21)), but that was no help to couple suing credit reporting companies.
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.