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Calli Turner focuses her practice on complex civil litigation. She has significant experience with the Employee Retirement Income Security Act of 1974 (ERISA), the Texas Trust Code and the Texas Beer Industry Fair Dealing Law. She has also worked on matters involving shareholder disputes, trademark infringement actions and claims for breach of fiduciary duty. Read Calli Turner's full bio.

The ESOP industry is paying close attention to a Tenth Circuit appeal that will address the deferral of corporate deductions for certain accrued expenses payable to ESOP-participating employees. This appeal, which pertains to an underlying tax court opinion, Petersen v. Commissioner of Internal Revenue (decided June 13, 2017), is critically important to certain ESOP-owned S corporations for tax planning and other purposes.

Internal Revenue Code (IRC) Section 267(a)(2) defers deductions for expenses paid by a taxpayer to a “related person” until the payments are includible in the related person’s gross income. IRC Section 267(c) sets out constructive ownership rules for purposes of determining if certain persons are “related persons.” Section 267(c) provides that stock owned, directly or indirectly, by a trust shall be considered as being owned proportionately by its shareholders. In Peterson v. Commissioner, the US Tax Court addressed whether an ESOP trust is a “trust” for purposes of IRC Section 267(c).

Continue Reading A Matter of Trusts: Tenth Circuit to Decide Important ESOP Case