Choosing a business structure is one of the most important tax decisions our clients make. Used properly, pass-through entities such as partnerships, S corps, and LLCs can provide significant tax advantages; the formation of these entities, however, requires careful planning and consideration.
Our Tax and Corporate & Securities attorneys have extensive experience in addressing choice-of-entity questions and regularly advise clients regarding the tax advantages and drawbacks of various business structures. We work to understand our clients’ objectives and develop strategies to achieve them in the most tax-efficient manner possible; this includes drafting and reviewing partnership and operating agreements to ensure that both current and future tax implications are considered. Our partner Steve Moore is one of the state’s leading attorneys on the Texas margin tax, and our focus in this area enables us to provide experienced advice regarding entity formation in Texas.
We regularly help entrepreneurs, early stage, and emerging companies position themselves for future growth, investment or acquisition. We also help established businesses restructure their operations to increase tax advantages. Drawing upon our substantial experience in international taxation, we have helped U.S. clients structure their foreign operations to minimize tax liabilities, and we have advised foreign nationals on tax opportunities in U.S. investment. We have a long history of representing the oil and gas industry in Texas and have a thorough understanding of the complex structures and tax regulations involved in those businesses, including the formation of master limited partnerships and the use of production payments.
Our attorneys have particular experience in crafting tax-efficient compensation strategies for partnerships and LLCs. For example, we have helped clients identify profits interest opportunities, enabling them to attract and compensate key investors. We also assist clients with the dissolution, transfer or sale of partnership interests. Members of our Wealth Planning group regularly assist clients with succession planning and the formation of family limited partnerships and companies.
As in other areas of tax law, the rules for pass-through entities change often. For example, the economic substance doctrine was codified recently, legislation has been proposed to change the way carried interest payments are treated, and series LLCs continue to receive more and more attention. We stay ahead of proposed changes and continually educate our clients about ways to maximize tax benefits while minimizing risks.
- Represented clients in the creation and structuring of funds, including a $250 million private equity fund; fund squeeze-outs of founders; and all aspects of corporate, partnership and LLC transactions – roll-ups, divisions, acquisitions, and both taxable and tax-free reorganizations.
- Represented client in the structure of multibillion-dollar partnership combination of two private enterprises.
- Represented a $150 million privately held mineral and ranching company with restructuring, ancillary partnerships, and advising with respect to tax-free spinoffs, estate planning, and migration out of C corporation status.
- Represented a $180 million privately-held aviation enterprise with presale preparation and proposed restructuring, including integrated estate and charitable planning.
- Represented several-multimillion dollar S corps that had made various S corp missteps, requiring complete restructuring of company protocol.