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TOPICS / TAX

When does debt become worthless?

The Ninth Circuit, affirming the Tax Court, recently held that to deduct a nonbusiness bad debt, the debt must be “wholly worthless,” and if the debtor reports cancellation-of-debt (COD) income, the discharged debt is not thereby presumed to be worthless to the creditor. Facts: From 2007 to 2010, Michael R.

Tax Court denies $23 million façade easement deduction

The Tax Court denied a limited liability company’s (LLC’s) claimed charitable conservation contribution deduction under Sec. 170(h) for its donation of a façade easement because the LLC failed to establish that the building was a “certified historic structure” under Sec. 170(h)(4)(C). The court also rejected the LLC’s argument that the

SPONSORED REPORT

Preparing clients for new provisions next tax season

As the 2025 filing season approaches, H.R. 1 introduces significant tax reforms that CPAs must be prepared to navigate. These legislative changes represent some of the most comprehensive tax updates in recent years, affecting both individual and corporate taxpayers. This report provides in-depth analysis and guidance on H.R. 1.