Tax & Sports Update

Joseph B. Darby III

Some people have a “trophy husband.” Other people have a “trophy wife.” But only clients of Sullivan & Worcester LLP can have a TROPHY TAX ATTORNEY. Jay (the trophy in the middle) Darby is a tax partner in S&W’s Boston office who advises businesses and individuals on wealth creation and wealth preservation: How to make money, keep money, and pass money to the next generation at a minimum tax cost. Joseph B. “Jay” Darby III, Esq. Jay has over 30 years of practical tax experience, and, as the accompanying photograph should indicate, he embodies everything that a client could possibly look for in a sophisticated tax advisor: • Technical excellence • Creative thinking • Innovative solutions • Arm candy How the Tax and Sports Update Began Jay graduated with honors from Harvard Law School in 1978, and promptly did what any reasonable person in that situation would do: He became a sports writer! Over the years, he wrote sports columns for the Boston Herald, the Boston Phoenix, Hemispheres (the United Airlines in-flight magazine) and Worcester Magazine. For his efforts he was awarded First Place in the Sport Column category by the New England Press Association in 1989. After five years of full-time sports writing, Jay decided to get a “real” job as a tax attorney — and soon discovered that he loved to write about taxes as much as about sports. He now brings his sports-writing talents to the world of tax law, for the benefit and entertainment of our readers. Jay was honored as the “Tax Writer of the Year” in 2007, and again in 2011, by Practical International Tax Strategies, a division of Thomson Reuters. At the 2007 award ceremony, the Editor of Practical International Tax Strategies, Scott Studebaker, said: Our decision to award Jay Darby the “Tax Writer of the Year” award was both easy and difficult. Difficult, because we had many excellent articles from tax lawyers and other tax specialists to choose from. The easy part was because Jay’s articles are the ones that make us laugh.” In accepting the award, Jay deadpanned, “It is deeply gratifying to be identified as America’s leading — not to mention only — tax humorist.” Jay has finally found a way to combine his twin passions for tax and sports as the founding editor of the “Tax and Sports Update.” It is, unquestionably, the ONLY tax newsletter with an award-winning sports column! Jay has written literally hundreds of published tax articles, and is the author of Practical Guide to Mergers, Acquisitions, and Business Sales, a popular book on M&A structuring published by CCH. Jay uses the book in courses he teaches on M&A at the Boston University School of Law in the Graduate Tax (LLM) Program and at Bentley University in the Masters in Taxation (MST) Program. Link to Jay’s complete and PAINFULLY SERIOUS biography, including over 75 of his tax articles, at http://www.sandw.com/professionals-447.html.

Recent Posts

How to Pay for College: Tax Savvy Tips for Parents

Posted by Joseph B. Darby III on Oct 16, 2018 3:50:11 PM

Once upon a time, a college degree was a true bargain: Four years of tuition cost about the same amount as a fancy new automobile, and pretty much set you up for life. Today, the price of that same college degree has sky-rocketed: The full-in cost of a college degree is now closer to the cost of a new house, and the size of the student loan has grown from a car loan to a mortgage. Every parent still wants to send a child to college, but the affordability factor is daunting and getting worse. Fortunately, there are smart, savvy ways to manage the looming costs of college – but they are not necessarily intuitive or easy to identify.

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Topics: Saving for College, Tax Planning

Last Call for the OVDP Program!

Posted by Joseph B. Darby III on Apr 19, 2018 12:50:58 PM

The IRS has announced that the Overseas Voluntary Disclosure Program (OVDP), which has been around since March 2009, is about to be shut down permanently, effective September 28, 2018.

The OVDP Program has seen over 56,000 taxpayers come forward voluntarily, paying over $11 billion in back taxes interest and penalties. The Program has always been a great deal for people who actually hid assets offshore, failed to report taxable income, and then want to come clean and get back into compliance, especially because the IRS is hot on everybody’s trail thanks to the FATCA regime and other enhanced offshore investigative techniques.

The IRS wants to terminate the Program because participation has declined steadily, from a peak of 18,000 disclosures in 2011, to only about 600 disclosures in 2017. However, the IRS is expected to maintain its aggressive posture on offshore tax avoidance, and so now is the last clear chance for people to take advantage of the OVDP Program and avoid severe sanctions (including criminal prosecution) for dubious past conduct.

Don’t miss this last call to help taxpayers come into compliance under this de facto “amnesty” program that ends on September 28, 2018. Call us at (617) 338-2985 if you or a client would like our assistance in “coming in from the cold” under the Program.

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Topics: Taxes, OVDP, IRS, offshore

Important Documents to Review Before Diving in to Trump's Tax Plan

Posted by Joseph B. Darby III on Dec 20, 2017 5:00:56 PM

Below are links to two documents that review some of the changes implemented by Trump's new tax plan. 

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Topics: GOP, Tax Plan, Trump Tax Reform

Chemistry Lesson: What Our Red Sox REALLY Need is Law and Order and a Good Judge (Not Aaron) in the Clubhouse

Posted by Joseph B. Darby III on Aug 28, 2017 9:41:53 AM

As the Boston Red Sox head into the home stretch of this 2017 baseball season, we Red Sox fans – a naturally dour and fretful bunch – worry whether this team is built for success in the upcoming MLB playoffs. After all, a very similar team – to wit, the not-ready-for-prime-time 2016 Red Sox – appeared on the October stage and proceeded to stink out the joint, getting swept 3-0 by the Cleveland Indians while delivering the worst group performance since the movie Waterworld was released. For sheer group ineptitude, the only comparable recent event was watching the Republican Senate try to fix Obamacare. Yeesh.

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Topics: Boston Red Sox, Sports, Don Baylor

The Tall Tax Tale of Why Country Songwriters Get Capital Gain Treatment

Posted by Joseph B. Darby III on Aug 18, 2017 1:41:21 PM

As a tax lawyer, my professional life has the elements that my grandfather believed were essential to a really good job: indoor work, no heavy lifting.

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Topics: The Eisenhower Rule, Code Section 1221, capital gains, tax break

The Gift That Keeps on Giving - To the IRS

Posted by Joseph B. Darby III on Mar 17, 2017 7:48:35 AM

GettyImages-508893778.jpgA rather stunning near–catastrophe almost occurred in the art world recently, and only dumb luck – namely, a casual off-hand remark with a savvy tax adviser  saved the art owner from a huge, self-inflicted tax bill from the Internal Revenue Service. A non-U.S. taxpayer (meaning a non-resident alien in tax parlance) had an extremely valuable painting being displayed in a U.S. museum or gallery and, for a variety of reasons, he wanted to transfer the painting to his spouse, who is also a non-resident alien. Let’s assume for the sake of argument that the painting was worth $50 million. Because the gift was from a non-resident alien to his non-citizen spouse, and the property was tangible property located or situated within the United States at the time of the transfer, this transfer would have been subject to tax the U.S. gift tax regime, at a tax rate of up to 40%. WHAAAAATTTTT???!!!

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Topics: estate tax, Tax, IRS, transfer tax

How a Forfeited Real Estate Deposit Is Treated for Tax Purposes

Posted by Joseph B. Darby III on Jan 9, 2017 10:41:02 AM

Taxpayer signs a purchase and sale agreement to sell real estate to an unrelated buyer for $2,500,000. Buyer deposits 10% of the purchase price, or $250,000, as an earnest money deposit and as liquidated damages in the event the buyer fails to complete the purchase. The buyer subsequently fails to complete the acquisition, and the deposit is forfeited to the Taxpayer. The real estate in question was held as long-term capital property and not as inventory.

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Topics: Tax Law, real estate, escrow

Darn Those Sox!

Posted by Joseph B. Darby III on Jul 29, 2016 11:45:28 AM

The following is an audited and certified report on the Boston Red Sox covering that portion of the 2016 fiscal baseball year through today’s date.

The Red Sox are unquestionably better – miles and kilometers and even light-years better – than they were during the dismal years of 2014 and 2015, but the question that lingers, like a heavy scent of garlic, is whether this year’s pitching staff, which looks depressingly similar to last year’s pitching staff except at the very beginning (David Price), the middle (where else would you put Drew Pomeranz?) and at the very end (Craig Kimbrel), is really and truly enough improved to make this year’s iteration of the Olde Towne Team a real contender as opposed to a mere pretender. At the moment, the needle is leaning slightly on the pretender side of the cosmic scale, but there remains enough baseball left in this season that a contender could yet emerge from the erratic and distaff patterns that have thus far characterized the Red Sox season.

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Topics: Red Sox

Building the New Berlin Wall: Treasury's Anti-Inversion Regulations

Posted by Joseph B. Darby III on Jun 10, 2016 9:23:03 AM

The Treasury no doubt felt that it could chalk one up in the win column early in April 2016 when, following its release of a veritable carpet bombing of new regulations designed to blow up inversion transactions, the primary target, Pfizer Inc., chose to wave the white flag and cancel—at least for the time being—its efforts to merge with Allergan PLC. 

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Topics: IRS, Tax, Inversion Transactions, U.S. Treasury

Forms Over Substance: IRS Information Reporting Surges

Posted by Joseph B. Darby III on Feb 26, 2016 11:29:25 AM

Once upon a time, the United States federal income tax laws were largely about determining your federal taxable income and then calculating and paying the appropriate amount of income tax. How quaintly old-fashioned that era seems today. 

Increasingly, the IRS is interested in much more than just your income taxes (although you still need to pay your taxes, too). These days, the IRS is also busy chasing a wide range of information, which is required to be reported timely on a remarkable – and often redundant – array of IRS returns. Typically, these returns demand stunningly detailed information covering a broad array of business and personal activities and assets. 

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Topics: IRS, FBAR, Foreign Assets

The only tax blog with an award-winning sports column!

The Tax & Sports Update provides timely updates and cutting-edge commentary on all issues affecting U.S. taxation, and, of course, an always humorous take on sports!

Read Jay's Bio 

The material on this site is for general information only and is not legal advice. No liability is accepted for any loss or damage which may result from reliance on it. Always consult a qualified lawyer about a specific legal problem.

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