Federal Income Tax Planning & Litigation

Since the founding of our firm, tax planning has been a core strength of the legal services provided by Sugar Felsenthal Grais & Helsinger LLP.  Our tax attorneys draw on broad practical experience and deep technical knowledge to structure tax-efficient transactions for our clients. We help our clients effectively respond to audits and, if necessary, pursue administrative appeals and tax litigation.

 

We know that tax efficiency can affect our clients’ return on investment and that strategic tax planning is essential to giving our clients the best opportunity to succeed in their businesses. We advise our clients in all aspects of the business lifecycle from formation to operations and expansion to sale and restructuring or even retirement and succession.  We believe that our clients are best served by involving our tax attorneys early in the process of planning transactions.  Our approach is to explain the tax consequences of our clients’ various business decisions so they may choose the best way to achieve their business goals with the minimum tax burden. Because our advice is both technical and practical, our clients have learned to call us first – while the deal is still in the conceptual stage. 

As part of our integrated approach, our tax attorneys work with attorneys from other practice areas to address all types of business needs including: the financing of subsidized housing projects or the purchase or lease of a factory, the purchase or sale of a business, the design of a family business succession plan, and the structuring of the settlement of a lawsuit.
 
Other law firms also turn to Sugar Felsenthal Grais & Helsinger LLP for tax advice.  We serve as tax co-counsel to attorneys at other firms who rely on us to help structure and review tax issues for their clients’ transactions and litigation settlements.  Our attorneys have also served as consulting and testifying expert witnesses in cases involving complex tax issues.
 
The attorneys of Sugar Felsenthal Grais & Helsinger LLP have extensive experience in dealing with the IRS. We understand that when the IRS calls, our clients’ businesses are potentially at risk.  Our clients rely on us for our judgment in understanding of when to negotiate with the IRS and when to challenge the IRS in court.  We collaborate with our clients and their accountants to help navigate the complexities of the audit and appeal process.  We can help prepare for an audit, deal with revenue agents, negotiate a settlement, and, when necessary, develop a strategy for litigation and take a case to trial.

Publications

Speaking Engagements


Our Federal Income Tax Planning & Litigation attorneys' recent and notable engagements include:

  • Advised partners in real estate partnership on capitalization of existing mortgage debt, structuring transaction so as to reduce taxable income from cancellation of indebtedness.

  • Represented manufacturing company in $35 million sale to strategic public buyer while retaining certain factories, including pre-sale restructuring to minimize state income taxes on transaction. Subsequently, assisted in sale of retained factories.

  • Advised principal shareholders in taking private transaction of manufacturing company involving reverse stock split and appraisal rights for public shareholders.  Integrated estate planning for principal shareholders into the transaction to pass ownership of the company to next generation at significant estate and gift tax savings.

  • Assisted manufacturing company in tax and corporate structuring for expansion of operations to Mexico, including establishment of maquiladora.

  • Structured  acquisition of a major building in Chicago for real estate developer by purchasing defaulted debt of the owner, restructuring the debt and later acquiring the building through a deed in lieu of foreclosure, and subsequent sale of the building for substantial gain after short term hold to strategic buyer.

  • Guided chief executive officer in negotiation of advantageous employment agreement with public consumer products company.  Advised company on tax and restructuring issues in face of financial difficulties.

  • Represented substantial privately held agricultural company in structuring sale of business divisions, which included obtaining an IRS private letter ruling for tax-free split-off of the two divisions. We then handled tax planning and negotiated the subsequent sale of the spun-off divisions to a publicly traded strategic purchaser.

  • Obtained an IRS private ruling allowing a tax-free non-pro rata split off of two family owned businesses due to personality differences between third generation siblings.  Following split off, retained over long term for general corporate and tax representation by one company and numerous family members.

  • Participated in development and formation of large chain of consumer retail service outlets.  Continuing general corporate representation and assisted in obtaining operational financing.  Represented company in strategic sales of outlets.

  • Represented national retail chain through growth to over 60 company-owned stores and over 40 franchised stores in general corporate matters, real estate leasing and property acquisition, franchisee relations, debt financing transactions and ultimate advantageous sale of all stock of the company to strategic buyer while retaining the real estate on long term advantageous leases to Buyer.  Retained by Buyer for other legal work following closing of the transaction.

  • Represented of proprietary trading firm since formation, including initial capital raise and follow on investments, development and implementation of employee equity incentive plan and general corporate issue.

  • Testified as expert witness about standards of tax practice in attorney malpractice case arising out of promotion of offshore trust tax shelter strategy.

  • Testified as expert witness about standards of tax practice in multiple accountant malpractice cases related to Son of BOSS and similar tax shelter transactions.  Assisted defense counsel in developing strategy that resulted in advantageous settlements for client.

  • Defended a manufacturing company in IRS audit that resulted in U.S. Tax Court litigation in which adjustment for treatment of expenses related to product prototypes would have resulted in a $2.5 million adjustment and a change in accounting method that would have negatively affected the competitive position of the business going forward.  Resolved without trial for $35,000 without change in accounting method.

  • Defended real estate developer in IRS audit that resulted in U.S. Tax Court litigation in which his status as a qualified real estate professional for purposes of the passive activity loss rules was challenged.  Developed a strategy at the audit stage that resulted in settlement of a $6 million adjustment for $6,000 without trial.

  • Acted as outside tax counsel to a boutique mergers and acquisitions law firm, providing tax advice on deals such as sale of portfolio company structured as an LLC by a private equity firm, sale of a marketing business including employment agreements for key principals, structuring of equity participation for executive in new joint venture LLC, and sale of pharmaceutical business held by family through multiple corporations.

  • Negotiated sale of client's interests in a manufacturing business to her siblings when dispute about management and direction of the business arose after the death of their father/founder of the business.

  • Represented family offices in structuring and implementing employment and equity participation arrangements for investment advisors.

  • Advised food industry start up business in formation of the company and expansion to multiple locations in Chicago.

  • Assisted agricultural company in developing and implementating a domestic international sale corporation (DISC) structure to reduce taxes on exported products.

  • Counseled estate on treatment of investment in Madoff ponzi scheme for federal income and estate tax purposes.