Current Developments (Part I) footnotes

¹ Bennett, “S Corporation Returns, 2001,” IRS Statistics of Income Bulletin (Winter 2004).

² IR 2004-51 (4/9/04).

³ Rev. Proc. 2003-79, IRB 2003-45, 1036.

⁴ Rev. Proc. 2004-14, IRB 2004-7, 489.

⁵ Rev. Proc. 2003-23, IRB 2003-11, 599, modified and superseded by Rev. Proc. 2004-14, note 4 supra.

⁶ A violation occurs when a disqualifying person controls 50% or more of the S corporation, directly or indirectly.

⁷ For details on the SESOP issues, see the AICPA Tax Division’s S Corporation TRP, “ESOPs and S Corporations,” 34 The Tax Adviser 493 (August 2004).

⁸ The ESOP Association reports that roughly 70% of its membership consists of S corporations; see Statement of J. Michael Keelings on HR 1896, The Subchapter S Modernization Act, Subcommittee on Select Revenue Measures for the House Committee on Ways and Means (6/19/03).

⁹ Rev. Rul. 2004-4, IRB 2004-6, 414.

¹⁰ Notice 2004-30, IRB 2004-17, 828.

¹¹ IR 2004-44 (4/1/04).

¹² For details on the schemes described in these pronouncements, see note 7, supra.

¹³ Donald G. Oren, 357 F3d 854 (8th Cir. 2004), aff’g TC Memo 2002-172.

¹⁴ Gary Luiz, TC Memo 2004-21.

¹⁵ Edward Selfe, 778 F2d 769 (11th Cir. 1985).

¹⁶ Bloom v. Bender, 48 Cal. 2d 793 (1957).

¹⁷ IPO II, 122 TC 295 (2004).

¹⁸ Eugene J. Schumacher, TC Summ. Op. 2003-96.

¹⁹ Eugene Glick, 96 FSupp2d 850 (SD IN 2000).

²⁰ Chief Counsel Advice (CCA) 200344008 (10/31/03).

²¹ Sutherland Lumber-Southwest, Inc., 114 TC 197 (2001), aff’d, 255 F3d 495 (8th Cir. 2001), acq., AOD 2002-2, IRB 2002-6.

²² Veterinary Surgical Consultants, P.C., 3d Cir., 3/10/04; Nu-Look Design, Inc., 356 F3d 290 (3d Cir. 2004); and Specialty Transport and Delivery Services, Inc., 3d Cir., 3/12/04.

²³ See also Yeagle Drywall, 54 FAppx 100 (3d Cir. 2002), cert. den.

²⁴ Jimmy D. Weaver, 121 TC 273 (2003).

²⁵ IRS Letter Ruling 200409010 (2/27/04).

²⁶ Notice 2001-76, 2001-2 CB 613.

²⁷ Rev. Proc. 2002-28, 2002-1 CB 941.

²⁸ IRS Letter Ruling (TAM) 200423014 (6/9/04).

²⁹ IRS Letter Ruling 200329011 (7/18/03).

³⁰ IRS Letter Ruling 200411015 (3/12/04).

³¹ REG-131486-03 (6/25/04).

³² Notice 2003-65, IRB 2003-40, 747.

³³ CCA 200409001 (2/27/04).

³⁴ Rev. Rul. 71-262, 1971-1 CB 110.

³⁵ IRS Letter Ruling 200346013 (11/14/03).

³⁶ IRS Letter Ruling 200327027 (7/3/03).

³⁷ IRS Letter Ruling 200419020 (5/7/04).

³⁸ IRS Letter Ruling 200406008 (2/6/04).

³⁹ IRS Letter Ruling 200422020 (5/28/04).

⁴⁰ IRS Letter Ruling 200346017 (11/14/03).

⁴¹ IRS Letter Ruling 200326023 (6/27/03).

⁴² IRS Letter Ruling 200402003 (1/9/04).