Tax Treatment of Equity Compensation for LLC Members
Structuring Equity-Based Interests for Optimal Tax Outcomes
Recording of a 90-minute CLE webinar/teleconference with Q&A
Conducted on Wednesday, September 1, 2010
Recorded event now available
This CLE webinar will provide tax advisors with an overview of the types of equity interests an LLC can issue and discuss the resulting tax impact for the owner, existing members and the entity. The panel will outline best practices for structuring equity incentive arrangements to optimize tax outcomes.
Description
LLCs can provide equity incentives to members by granting capital interests, profit interests or options to acquire such interests. Granting of equity interests is a contractual matter that may contain restrictions such as vesting and service requirements, performance standards and forfeiture.
The rules governing the taxation of equity interests are uncertain and complex. Making the optimal choice among the alternatives involves balancing the tax impact on existing members, prospective members, and the entity itself.
Granting interests at less than fair market value can give rise to taxation on the interest at the time it is granted. Having an outside professional valuation creates a defensible value on which to base the future benefits subject to taxation.
Listen as our authoritative panel of tax specialists discusses the alternatives for LLCs to grant equity compensation to its members, the tax ramifications to grantees, existing members and the LLC entity, and best practices for structuring equity compensation plans.
Outline
- Tax consequences of capital interests
- Tax consequences of profits interests
- Valuation issues
- Impact of proposed carried interest legislation
Benefits
The panel will review these and other key questions:
- What are the differences between profits interests and capital interests?
- What is the difference between structuring profits interests where liquidation is by capital accounts and where liquidation is in accordance with distributions?
- How can profits interests be structured so that profits interests recipients are treated as close as possible to holders of capital interests?
- Is a section 83(b) election needed?
- Should profits interest recipients be treated as partners and not employees? What are the tax implications?
- What effect could the pending carried interest legislation have on equity compensation for LLC members and what steps can members take to lock in favorable tax treatment under current law?
You will learn the types of equity interests that a limited liability corporation (LLC) can issue—and the potential tax consequences for the owner, existing members and the entity itself. You will learn best practices for structuring equity incentive arrangements for beneficial tax outcomes for all parties concerned.
Faculty
Christian M. McBurney,
Partner
Nixon Peabody, Washington, D.C.
His practice area is federal income taxation with particular emphasis on tax planning for partnership and corporate transactions. He also provides advice on media businesses, emerging business, private equity, §1031 exchanges, consolidated return, §280G, project finance, leasing, real estate, workout, S corporation, contract restructuring, and international tax matters.
L. Andrew Immerman,
Partner
Alston & Bird, Atlanta
He concentrates on federal income tax matters, including domestic and international tax planning and transactional work for joint ventures, partnerships, limited liability companies and corporations. He has helped structure many sophisticated partnership and limited liability company transactions and has represented the target or the acquirer in numerous corporate mergers and acquisitions.
Daniel N. Janich,
Officer
Greensfelder, Hemker & Gale, Chicago
He counsels corporations, executives and business professionals on employee benefit plan design and administration, executive compensation arrangements, and employee issues in mergers and acquisitions. He is an experienced litigator of benefits and executive compensation claims, and serves as special benefits counsel to firms and corporate law departments in transactional and litigation matters.
Ordering
Online CLE - Audio Recording
Includes audio streaming of full program plus handouts (available 24 hours after live seminar).
CPE: Self-study CPE is not offered on online webinars.
CLE:
Pre-approved for participatory or non-traditional/alternate format credit in: CA, HI*, NY*, WV*.
Pre-approved for self-study credit in: AK, AZ, FL, GA, MO, MT, TX, VT, WA.
Upon request, also available in: CO, CT*, ID, KY, LA*, ME, NC, ND, NE, NH, NM, NV, OR*, SC, TN, UT, WI*, WY. If you are applying for credit in one of these states, make sure to select those states when placing your order.
(*Indicates that Strafford must report attendance.)
Online CLE Audio $297.00
Available 24 hours after the live event
Recorded Event
Includes full event recording plus handouts (available after live seminar).
CPE: Self-study CPE is not offered on recorded events.
CLE: Pre-approved for self-study credit in: AK, AZ, CA, CT, FL, GA, HI, MO, MT, NY, TX, VT, WA, WV. Upon request, self-study credit is also available in: CO, ID, KY, ME, ND, NE, NH, NM, NV, OR, UT, WI, WY. If you are applying for self-study credit in one of these states, contact Strafford CLE at 1-800-926-7926 ext. 35 or CLE@straffordpub.com.
Webinar Download (Slide Presentation with Audio) $297.00
Available three business days after the live event
DVD (Slide Presentation with Audio) $297.00
plus $9.45 S&H
Available ten business days after the live event
MP3 Download (Audio with Slide PDFs) $297.00
Available 24 hours after the live event
CD (Audio with Slide PDFs) $297.00
plus $9.45 S&H
Available ten business days after the live event
Webinar/Teleconference
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Tax Law Advisory Board
Tax Partner
Steptoe & Johnson
Of Counsel
Morrison & Foerster
Partner, Federal, State and International Tax Planning
Rogin Nassau
International Tax and Tax Controversies Partner
DLA Piper
Partner and Practice Group Leader - Tax
Waller Lansden Dortch & Davis
Transactional Tax Partner
McKenna Long & Aldridge
Partner, Cross-Border Transactions Tax
Fraser Milner Casgrain
Federal Tax Partner
Nixon Peabody
Partner, Tax-Exempt Organizations
Steptoe & Johnson
Partner, Corporate Tax and Due Diligence
Pepper Hamilton
Tax Controversy Partner
Crowell & Moring
Of Counsel
Skadden Arps
Peter Stathopoulos
Managing Director, State and Local Tax Practice
Bennett Thrasher
Partner & Co-Chair, State & Local Tax Practice
Sutherland Asbill & Brennan
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